[gcbdad]

Here is an interesting article I just read in USAtoday.



Today's Top Tech Stories

Disney aims at video renters with new Moviebeam
By Bob Tourtellotte, Reuters
LOS ANGELES — In an effort to reach movie consumers directly, the Walt Disney Co plans to compete with video renters like Blockbuster Inc through a low-cost service called Moviebeam it is expanding this fall, company officials said.
In interviews this week, Disney executives said Moviebeam — a computer drive that connects to a television and stores and shows movies like a DVD player — is a first step in a broader technology push aimed at becoming more like a retailer in new, digital business arenas.

By shedding its current position as a wholesaler that packages films on videos or DVDs, Disney would reap all the rental revenue instead of sharing it with retail outlets.

Initially, Wall Street analysts see little financial impact on the media giant that earns revenue of $27 billion a year from theme parks, movie studios and TV networks like ABC. But they say it could prove to be a savvy strategic move to take advantage of increasingly cheap content delivery and storage.

"This is an opportunity for us to have a direct relationship with movie consuming customers," said Peter Murphy, Disney's chief strategy officer. "We are starting at movies, but it doesn't have to stop at movies."

Moviebeam is expected to be a first step toward delivering movies, TV shows, sports and news to a range of products such as advanced cell phones or personal media players — portable gadgets the size of small books that store and play video.

But Disney executives said that before focusing on those future devices, they wanted to show they could reach consumers with a real product in a proven market.

Low cost, high potential

Moviebeam is a set-top box like a satellite, cable, or other TV receiver. Its hard drive can store 100 movies, and an antenna receives new films via broadcast airwaves.

Consumers rent the box for a monthly fee ranging from $6.99 to $8.99. They pay another $1.99 to $3.99, depending on the title, to rent each film for a period lasting 24 hours.

Disney launched Moviebeam last September in Salt Lake City, Utah, Jacksonville, Florida and Spokane, Washington. Last month, it said it would be in three more cities this fall.

If the additional markets prove successful, more cities will be added in 2005, said Salil Mehta, executive vice president for corporate business development.

He declined to be specific about the number of markets Disney would tap, how quickly it would do so, and the amount of subscribers who have already signed up. He did say initial customers have exceeded company and retailer expectations.

Customers can enroll at consumer electronics stores like Best Buy or Circuit City.

Mehta said a primary target market is the roughly 30 million consumer homes who rent four or more movies a month and who say they to pay $11 to $15 a month in late fees. Disney markets Moviebeam as a way to avoid paying past due penalties.

For consumers, two keys to Moviebeam's success are delivery directly to TVs, and immediate availability. Movielink and CinemaNow, two other direct-to-consumer services, are Web-based and need cabling to reach TVs. Online rental service Netflix Inc. takes a day or more to deliver films via the U.S. mail.

For Disney, an important factor is Moviebeam's low cost to startup — roughly $250,000 per city — because it uses standard broadcast airwaves to deliver DVD-quality movies. Mehta said Disney could "light up" the entire U.S. for an investment of $50 million.

Breaking even requires two million subscribers, Mehta said. But for now, the idea is to introduce it slowly in order to make it a success, he said.

[mickey]

We have had MovieBeam here locally for about a year. I guess we were one of the test markets. I have heard good things about it, though I have never used it. Has anyone tried this out?

[tinkerbell]

we will be the last to get anything like that ..but it makes me think of what we saw in the house of the future at Epcot where they showed you could get movies on request

[Metalfan]

I've never heard of anything like that...but it sounds like it could be cool. I'm definitely interested in seeing and hearing what it's like!