The titan of discount retailing, Wal-Mart, yesterday finally made its move to sell movies-over-the-Internet. On the heels of Wal-Mart’s big announcement, former P2P renegade BitTorrent said it has made progress in its bid to go legit and announced a spate of online TV and film distribution deals with top studios and TV networks.
The original powerhouse in home video, Blockbuster, hopes to have an online movie deal next year, CEO John Antioco was quick to add at the Reuters Media Summit yesterday. The current star of the video rental market, Netflix, plans to unveil its own online distribution strategy early next year and is budgeting $40 million to build the service.
Wal-Mart, BitTorrent, Blockbuster and Netflix are joining a relatively robust market for online movie downloads. Right now users can turn to at least ten major online outlets to purchase and download feature-length films including iTunes, Movielink, CinemaNow, AOL, Guba, Vongo, Amazon Unbox, iFilm and MovieFlix, not to mention Google’s nascent film download business (which mostly consists of grade Z films.)
Despite the rush to deliver films online, no one is making serious money selling movies over the Internet, (although, it must be said, Disney is definitely generating decent pocket change with its sale of movies via iTunes.) Watching movies on PCs is just not as much fun as watching them in the family room — people just don’t want to do it except in limited situations such as on airplanes, in the back seats of cars and so forth.
One of the most experienced executives in this business, Jim Ramo, CEO of studio-backed Movielink, said during an audio event we held in early October that Internet-delivered movies won’t become a mass market business until someone bridges the divide between PCs and TVs.
It’s sort of ironic. The Internet, which today primarily talks to PCs, is still not yet a mass market product because the PC is the primary display and that’s still constraining long-form video on the web…Clearly it’s not a mass market product until you get it to the TV.
Why then is everybody rushing to sell movies on the Internet? One answer could be that someone, soon, is going to bridge the divide between the PC and the TV and everybody senses this breakthrough development coming. Apple plans to unveil its mysterious iTV unit early next year, a piece of equipment that promises to enable easy TV-based viewing of PC-based content. Intel has its still-fuzzy Viiv platform that can do the same thing. Tivo is doing its part to help the PC-to-TV transition along.
Another explanation for the most recent movies-over-the-web hub-bub is that while few people want to sit and watch a full-length film on their PCs, they like having the option of doing just that. Bundling DVD sales with add-on downloads is therefore a nice marketing device for retailers. Wal-Mart is charging $1.97 to $3.97 (typically weird Wal-Mart prices) for downloads that accompany DVD purchases, but some studios think Wal-Mart should be giving the downloads away free as promotions to buy the DVDs.
No matter why all of these top companies are gearing up to sell films on the Internet, it’s clear that Hollywood has gotten over its fear of the web. In just two or three short years, the studios have gone from wary to enthusiastic about this new revenue stream. At some point soon, expect every movie every made to be available for some kind of viewing — PC, TV, mobile device, whatever — at the click of a mouse.
Cynthia Brumfield at 8:12 AM|Comments(0)
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