Download-to-Own Movie Services Open the Door to the Future of Digital Distribution

In early April, the two leading online, all-digital online movie rental purveyors announced separate download-to-own initiatives that provide consumers with a way to purchase and download movies legally over the Internet.

Now, consumers with PCs running Internet Explorer can navigate to either Movielink.com or CinemaNow.com and download full-length, DVD-quality movies in Windows Media format. Additionally, many movies will be available online at the same time they’re available on DVD in a retail store.

Comments from Hollywood executives indicated the importance of the announcements. "Warner Bros. feels this is an important first step in the creation of a digital distribution business in the U.S.," says Kevin Tsujihara, President, Warner Bros. Home Entertainment Group: "Consumers are looking for this functionality, and we are working very closely with other partners we have and our retail partners to move this business further along.

"This is a very new and exciting way of delivering our film productions to the consumer," says Rich Finkelstein, President and COO, Universal Pictures, "It furthers our goal of delivering our products to consumers wherever and whenever they want it."

The announcement of download-to-own services undoubtedly represents a major step in the acceptance of the Internet as a viable means for distributing movies and creating an extra revenue stream for Hollywood. At the same time, there’s no denying that these announcements represent a first step rather than the endgame for this nascent market.

What follows is a look into why now is the right time to push forward with a download-to-own service, what these services are offering consumers as incentives to shift more of their media buying dollars online, and what the future holds for download-to-own services through the eyes of the CEOs of both Movielink and CinemaNow.

Why Now?
While technically consumers have been able to download movies over the Internet for the past few years, it’s mostly been in the form of independent films. One major piece of the overall content delivery puzzle needed to establish itself both technologically and perceptually before the major movie studios would buy into a download-to-own model. "I think a big part of it is the developing confidence on the part of us as a distributor and the studios as content providers in DRM, in particular not only just DRM as a security system . . . but also (in DRM providers) as our security providers," says Movielink CEO Jim Ramo. "I think Microsoft and Real have come to realize that it’s not just a matter of writing golden code and walking away. They really do have to provide an ongoing service and create a relationship with us as a distributor so they can solve problems before they happen. With that developing confidence comes the ability to open one’s business model beyond the limited rules of just rental."

And opening up one’s business model is exactly what CinemaNow has had in mind since the turn of the century. "We’ve always said, all the way back to ’99, that what was taking place in the music business back then was just a precursor to what could happen with movies and DTV content, and that’s what we’re seeing today," says Curt Mavis, CEO for CinemaNow. "We’ve been waiting a long time for some new exciting developments, and this is definitely one of the biggest things."