Ben Fritz at Variety reports that the Xbox 360 video download service announced in November may be a surprise hit:
In a topsy-turvy year for the digital download biz, a videogame service in just a few million homes is ending 2006 with more momentum than the world’s biggest e-tailer.
The relative success of video downloads on Microsoft’s Xbox Live and disappointment of Amazon.com’s Unbox point to two factors that differentiate Xbox from Amazon and its many other competitors — consumers who download a movie want a simple way to watch it on their TV, and those with high-def TVs want high-def content.
Thanks to the Xbox 360′s direct connection to a TV and the console’s focus on HD content, Microsoft can deliver both. Though exact sales figures aren’t available from any Web site or studio, insiders agree that it’s the most, and maybe only, positive story in digital movie downloads this year.
Many in Hollywood had high expectations that Amazon’s strength in DVD sales would spur the nascent Web download biz. But the Netco faces the same problems as competitors such as Movielink, CinemaNow, Guba and AOL that launched before it: It’s difficult for consumers to burn downloads onto DVD (save for a few titles on CinemaNow), and it’s tricky for all but the most tech-savvy to watch downloads on a TV.
Part of it is the tech savvy Xbox 360 demographic and part is the ease of watching a movie on a box already connected to a TV (which says something about where Windows XP Media Center systems are installed). There aren’t really any hard numbers, but the buzz is that despite the limited audience, Xbox 360 download numbers are equal to any of the PC download sites. While that’s certainly good news for Microsoft, it also illustrates the current sad state of Internet video downloads.
When I last mentioned CinemaNow back in April, it got a Thumbs Down as a typical Internet movie download service hobbled by digital rights management:
… as usual when Hollywood gets involved with the Internet there’s some wackiness involved: the movies are expensive and can only be played on Windows PCs. Moreover, that’s only one specific PC for CinemaNow …
It looks like they’ve noticed the problem (probably because very few customers were showing up) and now CinemaNow is offering some DVD downloads on the same day the movie is released to retail stores:
Universal Studios became the first movie studio to provide movie fans with a way to burn their downloaded movies to DVD on the day they are released in stores through an agreement with CinemaNow. Up until now, users could only burn select older movies from the service’s catalog.
The first movie to participate in this offering is “The Fast and the Furious: Tokyo Drift.” On the same day the movie is released in stores, CinemaNow users will be able to download the movie, including the menus and bonus features, for $9.99 USD.
CinemaNow has been offering the “Burn to DVD” option since July, with movies from Buena Vista Home Entertainment, Lionsgate, MGM Worldwide Digital Media, Sony Pictures Home Entertainment, Universal Studios Home Entertainment, EagleVision and Sundance Channel.
Currently CinemaNow has only about a hundred movies available in the Burn to DVD format, but it’s a start. Also, before you get too enthusiastic, read this article by John Quain in the NY Times dealing with his downloading experiences at CinemaNow and other sites. I think CinemaNow has progressed beyond the Thumbs Down stage, but it still has a long ways to go.
Saul Hansell at the NY Times:
Six major studios plan to begin selling movies over the Internet today that buyers can download and keep for watching at any time.
Starting today, nearly 300 films will go on sale through Movielink, which until now has been largely an online rental site. Movielink (owned by Warner Brothers, a unit of Time Warner; Sony Pictures; Universal; MGM; and Paramount, a unit of Viacom) will offer films from all of its owners and from 20th Century Fox, owned by the News Corporation.
Another movie site, CinemaNow, will start selling downloadable versions of about 75 movies from Sony, MGM and Lions Gate, which owns a large stake in CinemaNow. Curt Marvis, the chief executive of CinemaNow, said he was talking to other studios about selling downloads.
Apple, Amazon.com and other online retailers are also busily trying to cut deals with Hollywood to sell downloads, according to several studio executives. In general, the studios want to make downloads available on largely the same terms, in as many places as possible.
There’s more by following the link, but as usual when Hollywood gets involved with the Internet there’s some wackiness involved: the movies are expensive and can only be played on Windows PCs. Moreover, that’s only one specific PC for CinemaNow or up to three PC’s for Movielink due to the copy protection. All this plus the hour or more download time on a high speed Internet connection makes me wonder exactly what these folks were thinking. Cliff Edwards at BusinessWeek Online sums it up nicely:
One wonders whether many consumers will be attracted to paying as much as twice the price for a movie that they can get in the local Best Buy or Wal-Mart on the very same day without having to wait for at least an hour to download (using a very fast broadband connection). And at least the physical media will play in just about any DVD player.
Seems to me that with all the dough studios will save from not having to deal with physical media and returns–$6 to $8 by some studio execs count–the greed factor shouldn’t be quite so high. I’m all for convenience, but not when I feel like someone is picking my pocket while pretending to give it to me.
As a result, I’m awarding these services my coveted “Thumbs Down” rating. Too bad – they could have been contenders.