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Mouse, Fox on VOD

Disney and News Corp. team up to launch Movies.com 9/09/2001 08:00:00 PM Eastern

On the video-on-demand front, all the big studios are present and accounted for now that word has surfaced that Disney and News Corp. will partner in a VOD service scheduled to debut early next year.

Word of that venture came last week, just three weeks after the five other major studios—MGM, Paramount, Warner Bros., Universal and Sony Pictures—said they are forming their own VOD venture, also expected to be launched by early next year.

Pricing hasn't been set for either service, but it's expected that it will cost about $4 to download a film from either one.

Disney and News Corp. are ahead of the game in one respect: At least they have a name for their service, to be called Movies.com, which will provide films and other entertainment content to U.S. consumers on a pay-per-use basis.

Disney and News Corp. say their service will be different from the rival and as yet unnamed service in some ways. One difference they say is that they plan to carve out a short new window when Disney, Miramax and 20th Century Fox films will be available on the VOD service before they go to the traditional pay-per-view window on cable.

But sources say that, by the time the two services launch, that difference may be gone. "Paramount, Sony et al obviously have to consider offering a similar window," one source notes.

Movies.com will be available to consumers via digital set-top cable boxes and all forms of broadband Internet access, the companies say. The service will feature films and other content from The Walt Disney Studios, including its Miramax Film division, Twentieth Century Fox and other content licensed from third-party suppliers, as well as movie-related information and promotional video content.

In addition, according to executives, Movies.com will have a commerce site where consumers will be able to buy movie tickets and possibly merchandise as well.

News Corp. and Disney expect that, when the service launches next year, more than 10 million homes in the U.S. will be able to access video-on-demand via either broadband Internet or through digital cable set-top boxes. The service will absorb Disney's existing Movies.com Web site, a movie-information service, and will be based in Los Angeles.

News Corp. President and Chief Operating Officer Peter Chernin says the venture will "provide consumers with an exciting new way to enjoy films with full-function capability and will be an important step toward protecting the integrity of our intellectual property in the broadband era."

Disney Chairman Michael Eisner adds: "With Movies.com, we are creating a new service that takes advantage of advances in technology that will enable consumers to enjoy an exclusive array of their favorite films and other forms of entertainment on demand in their homes." The venture will be owned equally by the two companies.

In addition to current products, Movies.com will offer films from the libraries of Fox and Disney. Users will be able to access a film on the service through their digital cable set-top or via any broadband Internet connection to download the film to a computer hard drive for playback on a television or computer display. In either case, users will be able to watch the film using pause, stop, rewind and fast-forward functionality, according to the companies.

March