Reruns and rentals apparently aren't enough for TV lovers these days. Consumers shelled out more than $2 billion last year to purchase DVDs of shows ranging from Seinfeld to The Simpsons to Sex and the City. And the TV industry is loving it. Historically beholden to fickle ratings and ad spending, studios are reveling in a new revenue stream for which costs are low (old show, new box) and profit margins high--as much as 50%, according to Merrill Lynch analyst Jessica Reif Cohen. By 2008, Cohen projects, the business will grow to $3.9 billion annually. The biggest beneficiaries: Time Warner, which...
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