Hollywood rushes to embrace download-to-own

By Steve Malone

Posted on 4 Apr 2006 at 10:29

Hollywood studios are rushing to catch on with the latest trend in home entertainment - downloads of new movie releases that you can keep. A group of some of the major Hollywood names have announced they plan to offer a download-to-own service that allows customers to buy a movie over the Internet and not only keep it permanently but also make copies.

The first new release that will be offered through the service is the Oscar winning Brokeback Mountain. The announcement follows a similar move made by Universal Studios, which last month signposted the first legal download-to-own service in the UK.

The new service is being promoted through Movielink - a US-only service jointly owned by MGM Studios, Paramount Pictures, Sony Pictures Entertainment, Universal Studios and Warner Brothers. Formed in 2002 for the purpose of offering pay-per-view movie downloads, originally viewers could a download a film onto their computer's hard drive, where it could stay for up to 30 days. However, once a customer chose to watch the film it could be watched as often as possible but only for a 24-hour period before it became unusable. The service also suffered from the fact that the studios preferred to release first on DVD format.

Under the new system, new films, including Universal's King Kong and Warner Brothers Harry Potter and The Goblet of Fire, can be transferred to two additional personal computers. They can also be copied on to a back-up DVD via Windows Media Player.

However, there is a catch in that the discs will not be usable on a conventional DVD player, enforced by the Microsoft DRM. It also means that customers will not be able to play the films on iPods or PSPs. New releases will be offered for between $20 and $30 per download while older movies will start at nine dollars.

Quite whether consumers will pay packaged DVD prices for a format they can only play on their computers remains to be seen. Presumably, the studios are trying to protect their standard DVD sales while opening a potentially lucrative new revenue stream while trying to stem the flood of illegal file sharing.

Given that the scheme was piloted in the UK by Universal, we can expect the other studios to offer their product to British customers in the near future. However, in the current UK pilot, customers get the download and the packaged product.

The movie studios will have learnt from the experience of the music business. After first resisting the trend towards downloadable music as a threat to their CD businesses, the music companies have now whole heartedly embraced 'legal' downloads as a triumph for the industry. On Sunday, for the first time, the UK singles chart was topped by a track that had been sold purely through Internet downloads.