Disney-On-Demand Gets Dry Run
The Walt Disney Co. on Monday launched a service to transmit movies over the airwaves to customers' homes in three communities, betting that such delivery will prove more popular than trips to the video store or ordering movies through a cable system.
MovieBeam sends whole movies in digital form over the same broadcast spectrum already used by television stations. The movies are then stored in the hard drive of a set-top box and can be viewed at any time, unlike movies ordered on cable television, which run at preset times.
The set-top units come with around 100 movies already stored and available for viewing. Ten new releases a week are transmitted to the unit, edging out 10 of the older titles, and so on. Users pay a $6.99 monthly rental fee for the set-top unit and between $3.99 and $2.49 for each movie they watch, depending on whether it's a new release.
Disney rolled out the service in Salt Lake City, Jacksonville, Fla., and Spokane, Wash. A nationwide release was projected for sometime next year, said Salil Mehta, Disney's executive vice president of corporate business development.
It takes about two days for new MovieBeam subscribers to receive a fully loaded set-top receiver unit.
The Burbank, Calif.-based company is banking on movie fans seeing advantages in MovieBeam over both video stores and pay-to-view cable movies. MovieBeam users can view a movie whenever they like, without having to drive to the video store or worry about late fees, and they can pause the movies like they would a video or DVD.
MovieBeam users, however, would be limited to viewing only the movies that are fed into their boxes.
Mehta said the service will focus on new movie video and DVD releases, which he said account for 80 percent of video store revenues.
"That's what we're trying to replicate with our service," Mehta said. "It's going to be all of the new releases from virtually all of the movie studios."
It will take 30 to 40 days for the newest titles released at the video stores to be made available to MovieBeam customers, Mehta said.
By Alex Veiga