Blockbuster unveils download kiosk - Two-store test to begin in weeks
Visions of an MOD world Kiosk and technology companies eye spring retail tests
Sony pacts with Hewlett-Packard for manufacturing-on-demand
Primera to Show Retail-Ready DVD on Demand™ Solutions at PMA
Walgreens Sees Movie-Burning DVD Kiosks In Their Stores
Sonic Solutions Unveils DVD-On-Demand System
Movie DVDs Sold At Kiosks Get A Boost
DVD CCA Effective Date
Polar Frog Digital Inks Deal for College Sports Programming
Polar Frog Digital Inks Deal with First Look Studios
First Look puts movies into DVD burning kiosks
Scottsdale's Polar Frog brings custom DVD kiosks to airport shops
Polar Frog Digital Moves DVD Burning Kiosks into Airports
Specifications for DVD-R for CSS burning approved
Download DVD Specification Gets Approval
Sell DVDs, don't shelve them
DVD burning desires - Download derby turns to disc pressing
Hollywood Studios Approve DVD Burning Kiosk Technology
Film studios okay new DVD format
Sonic Launches Technology and IP Licensing Program for Secure DVD-on-Demand
Sonic Solutions to introduce technology in Q1
Hollywood Studios Sign Off On Download-to-DVD System
Studios Approve DVD Burning Technology
Movie studios approve new copy protection system to allow burning
Studios okay users burning CSS-encrypted movies, but special media is required
Studios embrace copying technology
Sonic unveils anti-copying technology for movies burned to DVDs
Sonic Solutions, Macrovision devise retail DVD burn system
Partnership could mean quick DVDs
What's Holding up Movie Downloads
Hollywood to relax DVD security standard
Security spec near for burning downloaded movies to DVDs
Burning movies onto DVDs may be getting easier
Burning issue: Transfer to DVDs - Movie licenser changes its tune
Hollywood Might Ease DVD Burning Bans
Legal DVD Burning for Digital Films Closer to Reality
Hollywood ready for DVD burning - The beginning of a beautiful friendship?
Film-to-DVD Burning to be Simplified
DVD Burning, Retailers and Comsumers
DVD burning of download movies could become legal
DVD Copy Control Association loosens restrictions... slightly
If It's Tangible, They Will Buy...
Service to use Sonic Solutions' DVD-on-Demand technology
Kiosk maker to bow machines at grocer Sprouts
Movie downloads may be coming to a store near you

Blockbuster unveils download kiosk - Two-store test to begin in weeks

By Paul Sweeting of Video Business
Blockbuster chairman and CEO Jim Keyes unveiled a working model of the retailer’s planned in-store download kiosk Wednesday during the company’s annual shareholder meeting here. The working model is one of two that will be used in a two-store pilot test starting within the next few weeks, Keyes said.
“We call it a test but it’s really a beta,” Keyes told reporters following the formal presentation. “The goal is to bring all the pieces together—the content, the aggregation, the device—to try to demonstrate consumer acceptance. Once we do that, we’ll be able to think about a broader test.” The kiosk, built for Blockbuster by NCR, a leading maker of ATMs and other self-service machines, stands about eight feet high and features a touch screen for navigation as well as a display screen for showing trailers, key art, reviews and other graphic material. Consumers insert a portable media player into a slot on the front of the kiosk, which then downloads the selected movies directly to the player’s hard drive or solid-state memory device. Transfers currently take about two minutes, but Keyes said that new portable media players will cut the download time to about 30 seconds.
“We want it to be an ATM-type experience,” he said. “You wouldn’t stand at an ATM for two minutes waiting for it to process your transaction, and we don’t want our customers to have to wait that long.” For now, the kiosks work only with the Archos Generation 5 portable media player, which Blockbuster will begin selling in-store. Eventually, however, the plan is for nearly any type of portable media player or storage device to be able to plug-in and accept movies from the kiosks. Archos also is the manufacturer of the portable storage device used by Paris-based Moovyplay, a recently launched service in France that allows consumers to download movies to the device from in-store kiosks and play them back on a TV screen using a docking station attached to their TV set. Keyes demonstrated a similar set-up on Wednesday. Blockbuster also will sell the docking stations.
“We’re concentrating on the portable market right now, because we think there’s a growing demand out there for portability in content,” he said. “But we’re also following what’s going on in various European markets closely.” As always with any new distribution platform, one of the biggest hurdles Blockbuster faces in rolling out its kiosk plan is securing the rights from the studios. Keyes acknowledged that content on the kiosks will be “limited” at first, but he expects it to fill in as consumer acceptance grows.
Moovyplay managed to launch earlier this year with product from nearly all the major U.S. studios as well as several leading French distributors after multiple delays caused by holdups in the negotiations over rights. Another reason for sticking with the Archos player for now is that its digital rights management has been fully vetted by the studios thanks to Moovyplay. “The studios obviously have to approve each device and that takes time,” Keyes said.
The in-store kiosk is just one component of a broad digital strategy spelled out by Keyes at the meeting. Also teed up is a relaunch of Movielink in June through Blockbuster.com. The company also is working on a set-top box that will allow streaming movies downloaded from Blockbuster.com to the TV set, similar to the device announced last week by Netflix and Roku. “We still think it’s early for set-top boxes,” Keyes said. “We could have rolled one out months ago, but we don’t want to invest too heavily in advance of the customer.” Blockbuster also is working on an IPTV platform that could permit streaming directly to a TV without the need of a set-top box.
Keyes had little new to share on Blockbuster’s due diligence around Circuit City, which Blockbuster has proposed acquiring for about $1 billion.
“All I can tell you at this point is that we’re still looking to complete the due diligence as quickly as possible so we can make a decision about proceeding [with the proposed deal] or getting back to what we’re already doing,” Keyes said. He said the acquisition of Circuit City would give Blockbuster “large footprint” stores that would allow a full presentation of entertainment devices and software. Those would complement Blockbuster’s current “standard footprint” locations as well as a possible rollout of “small footprint” locations that would rely more heavily on kiosks and vending machines. All of Blockbuster’s nine sitting directors, including Keyes and former dissident shareholder Carl Icahn, were easily reelected to the board by shareholders.

Visions of an MOD world Kiosk and technology companies eye spring retail tests

By Jennifer Netherby of Video Business
After a year of hype, the DVD manufactured-on-demand business is on the verge of a broad pilot launch at retail, which promises to make more movies available on DVD in more places than ever before. When kiosks begin rolling out in April, kiosk manufacturers say, consumers will be able to buy everything from catalog hits to smaller new releases that will be pressed in-store while they wait. Kiosks are expected to first appear in drug stores and other specialty retailers that have so far had a limited presence in DVD.
Trials have already begun with some retailers. Online grocer Peapod is testing manufacturing-on-demand with TitleMatch in the Chicago area. Best Buy is testing MOD Systems’ POD kiosks in some of its stores. Polar Frog has kiosks in several airports, some hardware stores and drug stores. Walgreens has said it plans be a leader in MOD kiosks when they launch but hasn’t disclosed more details. Meanwhile, CreateSpace, which sells movies on demand through parent company Amazon.com, and Hewlett-Packard, which makes DVDs on demand to be sold through retailer partners, continue to broaden their content.
The right content Now that DVD copy-protection technology CSS has been approved for use in MOD, the major studios are in talks with companies to offer catalog films and smaller new releases in the coming months. Sony Pictures Home Entertainment became the first major studio to sign an MOD deal in January, when it announced it would offer movies through H-P’s MOD service. The two haven’t yet disclosed which films will be made available through the service, but H-P Digital Content Services VP of business development Doug Warner says it will include former Oscar contenders, classic children’s movies, early star vehicles with reasonable box-office distribution and other films that have been sold through major retailers in the past.
Warner Home Video hasn’t yet signed a deal, but senior VP of digital distribution Jim Wuthrich says the studio expects to have front-line catalog titles available once kiosk rollouts begin in the next couple months. The studio is choosing the mix of product it will make available at the start and is working with manufacturers to evaluate their infrastructure and prepare product. “They’re all wanting to see what is that final product going to look like,” says TitleMatch Entertainment Group VP of business development Mary Litchult. “Quality is extremely important to them as it is to us.”
Testing usage, title mix Sonic Solutions has licensed its Qflix technology to securely deliver films on demand through kiosks and is working with content providers and MOD companies to get that digital content ready. “Right now, we’ve got a lot of companies that we’re working with that are basically in rollout mode, where they’ve got plans for trials; in some cases, people are talking about 10 to 20 store trials. We have a couple companies doing 100 store trials,” says Jim Taylor, senior VP and general manager of Sonic’s advanced technology group.
The movies and TV shows in kiosks will vary by company and retailer. TitleMatch expects to have 1,000 to 2,000 films in its kiosks at launch, including catalog and smaller new releases. Users will be able to search by actor, film or genre. TitleMatch will monitor sales and can update offerings overnight. It also can regionalize offerings or make different films available at different retailers, depending on the audience. Polar Frog already has 11,000 specialty titles in its catalogs, including films from smaller suppliers such as Magnolia Entertainment and First Look Studios. Polar Frog is positioning itself as a digital rackjobber, managing product and sales for the retailer, says CEO Todd Rosenbaum. MOD Systems’ PODs now carry music and movie previews, but the company plans to add TV shows and movies this year. Initially, kiosk companies say they are focused on retailers that aren’t carrying large quantities of DVD. Execs say one place they’ll likely be found is near the pharmacy counter, where customers often have to wait for prescription refills. In most cases, customers will place their order and then pick it up 10 minutes later behind a sales counter. “As these kiosks are fairly new to the marketplace, we have found that most retailers prefer to have an associate involved in the manufacturing process [burning to CDs or DVDs] in an effort to deliver the most convenient, positive customer experience,” says Anthony Bay, MOD Systems executive chair and co-founder.
Building a catalog At the same time that retailers add in-store DVD burning, Amazon.com and H-P are adding content to their libraries for their centralized MOD offerings. Amazon’s CreateSpace has been a pioneer in the segment since launching in 2002 as CustomFlix. Since its acquisition by Amazon in 2005, the company has signed deals with ABC News, CBS News, A&E Home Video and other suppliers and filmmakers such as Jon Favreau. On-demand manufacturing has allowed the retailer to offer more niche programming that wouldn’t justify a full DVD release. The company also is able to turn out releases quickly, as it did recently with CNN’s Planet in Peril. “We don’t need to wait for replication runs,” says Darren Giles, CreateSpace chief technology officer and co-founder. “We can collapse the time between receiving video for a given title and starting to give it to customers. Timeliness is important, especially for topical or current events material.” H-P is developing a business-to-business portal through which retailers could order content from H-P’s catalog of MOD product from suppliers such as Sony, First Look and others. H-P has offered movies on demand through TransWorld since last year and has a deal with an unnamed 38-store chain in the Midwest. So far, sales have been “very limited,” Trans World director of merchandising operations and new media Ish Cuebas says.
But H-P plans to bring bigger content into its system and develop new ways, such as widgets that can be added to sites across the Web to target customers for niche product. H-P also is reaching out to wholesalers in its efforts to use MOD to make more titles already out on DVD available in the supply chain and “selling more of what they already have by doing it better,” Warner says. For studios and other suppliers, MOD offers the chance to sell deeper catalog titles than ever before. WHV has 6,600 movies in its library but only 1,500 have been released on DVD. “There are 5,000 titles not on DVD today that we can exploit in this model,” Wuthrich says. “We’re really interested in it.” Wuthrich believes in-store kiosks will end up featuring higher profile films, while more obscure long-tail films will be offered through services such as Amazon CreateSpace and H-P or in-store through bookstores and retailers that already carry a breadth of DVDs. He says that by the end of the year, MOD kiosks could offer TV shows available the day after they air or episodes of TV shows that consumers could mix and match for one DVD.
Titles that have made a mark in MOD In the Crease: This independent hockey film has generated $500,000 in gross sales since its release last year through Amazon’s CreateSpace.
CNN’s Planet in Peril: This strong-selling two-disc CNN special environmental report hosted by Anderson Cooper was sold through Amazon immediately after it aired.
Charlie Rose With Ang Lee & Heath Ledger (Dec. 7, 2005): This archive title picked up in sales on Amazon following Ledger’s death.
Prenatal Vinyasa Yoga—Jennifer Wolfe (fitness and yoga): Strong seller in health/fitness, which tends to be a good category for MOD.
How Do I: Series of home improvement videos have seen steady sales in Polar Frog kiosks in hardware stores.
Where to get MOD In-store kiosks:
MOD PODs in Best Buy and Starbucks offer music content right now from four labels: WMG, UMG, EMI and Sony BMG.
Polar Frog kiosk in Burbank, Calif., Detroit Metro and Raleigh-Durham, N.C., airports serve up specialized content and smaller films from Magnolia Entertainment, First Look Studios and other indies.
Online:
Amazon.com’s CreateSpace has content from major networks ABC, CNN, CBS and independent labels. Shows include Charlie Rose, Dinner for Five and CNN’s Planet in Peril.
Online grocer Peapod offers on-demand movies in the Chicago area from TitleMatch, whose library includes Bollywood films and other specialized content.
TransWorld offers Hewlett-Packard content through the retailer’s Web site. H-P’s catalog includes music documentaries on Pink Floyd and other artists from MVD, children’s shows such as Madeline from Cookie Jar Entertainment and classic TV from Synergy Entertainment (The Lone Ranger).

Sony pacts with Hewlett-Packard for manufacturing-on-demand

By Jennifer Netherby of Video Business
Sony Pictures Home Entertainment has inked a deal with Hewlett-Packard to make smaller films from its library available through DVD manufacturing-on-demand, making it the first studio to enter the MOD business. Terms of the deal, announced today by both companies, were not disclosed. Sony said it is still reviewing which titles will be offered through MOD, but said it’s possible some deeper catalog titles that have never made it to DVD because of low demand will get a release. “HP’s MOD service provides us with a viable means of delivering a broader range of niche and library product to consumers,” SPHE president David Bishop said. “We know there is strong consumer demand for these titles, and by working with HP, we may now monetize our deep product library and enable retailers the opportunity to bring a wider offering of Sony Pictures product to consumers without a significant investment in inventory.” HP is in negotiations with other studios to offer on-demand content, as well as video distributors and retailers. It currently has a deal with Trans World Entertainment, which sells MOD titles on Web sites FYE.com, SamGoody.com and Suncoast.com. Under HP’s deal with Sony, Sony chooses where its product will be sold. Sony senior VP of strategic development Jason Spivak said the company plans to offer its MOD releases to all retailers. “Our hope is that retailers will embrace the service as both an economical form of distribution and a complement to what they keep in their physical inventory,” he said. Through its DVD manufactured-on-demand business, H-P presses a disc when a title is ordered, allowing suppliers to offer deeper catalog films that don’t usually sell enough to score shelf space at retail or warehouse space at distributors. Amazon similarly runs a DVD-on-demand publishing business, CreateSpace (formerly CustomFlix), which has deals with TV networks, including NBC, CBS and A&E Networks, to create DVDs of certain programs on demand.

Sony is the first major studio to make its film library available through MOD. In addition to Sony, HP has DVD MOD deals with more than 40 suppliers including Arts Alliance America, First Look Studios and Gaiam Americas to publish more than 5,000 different movies. HP Digital Content Services VP of business development Doug Warner said the company views DVD MOD as the most immediate growth area for home entertainment. “In our view, only centralized manufacturing does not require a change in consumer behavior—all the others do—so that is where we’ve decided to focus our energy,” Warner said. The company had operated a movie download service for Wal-Mart, but exited that business in December because of little consumer interest. The company estimates that of the 70,000 movie and other types of content released on DVD, only a small percentage is actually in circulation, something that it hopes to remedy with its MOD business. The company estimates the industry loses $500 million each year in sales due to product being unavailable when a consumer tries to purchase it online. HP believes that smaller titles that studios and other suppliers haven’t ever released on DVD could add another $1 billion to $1.5 billion in annual sales. The company wouldn’t say how many copies it sells of a typical on-demand title. But most on demand content sells a small number of units since it’s used for niche content.

Primera to Show Retail-Ready DVD on Demand™ Solutions at PMA

Primera Technology, Inc., the world’s leading developer and manufacturer of CD, DVD, and Blu-ray™ Disc duplication and printing equipment, today announced it is showing complete, retail-ready DVD on Demand systems at the PMA Show in Las Vegas. PMA is the largest photo industry trade show in the USA and takes place January 31, 2008 through February 2, 2008 At the Las Vegas Convention Center. Primera’s booth number is #R231.

DVD on Demand systems let retail customers purchase DVD movies and other content such as television shows and video games directly through a touch screen. Discs are then burned, printed direct-to-disc and dispensed to the customer from Primera’s Bravo XRP Disc Publisher.

“Primera is excited to be supplying the automated disc publishers for these retail-ready DVD on Demand solutions,” said Mark D. Strobel, Vice President of Sales and Marketing at Primera. “We are proud to be a part of this revolutionary technology that will undoubtedly reshape the way consumers shop for movies and other digital content.”

Participating in Primera’s booth is a wide range of prominent companies involved in the emerging DVD on Demand industry, including Sonic Solutions, Pioneer Electronics (USA), TitleMatch Entertainment Group and Polar Frog Digital.

Primera’s automated disc publishing systems are able to record and print discs that offer virtually the same levels of compatibility, reliability and security as mass-produced titles. The company’s Bravo XRP Disc Publisher features two of Pioneer’s BDC-202MR Optical Drives for fast recording at point-of-sale as well as Qflix for applying CSS encryption.

DVD on Demand systems are expected to be deployed at major retailers beginning in early 2008.

Walgreens Sees Movie-Burning DVD Kiosks In Their Stores

By Sue Zeidler
Walgreen Co plans to put kiosks that can make DVDs of popular movies in drugstore photo departments next year, using a new system that would increase selection while avoiding piracy. Recent change in copy-protection rules governing DVDs have freed Walgreen and other retailers to tap this new movie market by letting consumers burn digital copies onto blank discs at stores, industry watchers said. Walgreen and CVS have tried to attract more customers in recent years by offering improved digital photo kiosks, in- store health clinics and exclusive merchandise.

For studios, the kiosks add to revenue, particularly from older and more niche content selections, without having to manufacture, ship and store them.

"We hope to launch DVD-burning kiosks in the next few months. We think its a type of solution that will work very well in our stores, giving us the ability to provide a virtual inventory to a diverse customer base," said Tiffani Bruce, a spokeswoman for Walgreen, the nation's largest drugstore chain, with more than 6,000 stores. Last month, the DVD Copy Control Association, a group of movie studios and hardware makers that oversees the copy protection system for DVDs known as Content Scramble System (CSS), moved to allow its technology to be licensed more broadly, opening the door for DVD-burning kiosks. Now Walgreen is working with Hollywood studios and consumers will be able to make DVDs in about 15 minutes.

"We believe it could right for most stores," Bruce said.

Walgreen and other retailers are working with Sonic Solutions , which released software based on the recently approved industry specifications last month.

Sonic said consumers or retailers need special DVD burners and recordable discs to use its Qflix software, which also paves the way for download services from companies such as Amazon.com Inc , Wal-Mart Stores Inc and Blockbuster Inc's Movielink. These services and Apple Inc's iTunes now mostly let users watch films on computers or devices such as iPods.

"The burning capability is a perfect complement to our Movielink download business, because it will eventually enable consumers to store movies on their hard drives or DVDs for future usage," said Blockbuster spokesman Randy Hargrove. He said Blockbuster would examine kiosks.

"We'll continue to monitor it. If it makes sense to get into kiosks, it's clearly something we could do," he said.

Sonic has licensed its Qflix software to kiosk companies such as Polar Frog Digital LLC, which licenses films and television shows from studios.

"We're in negotiations for content from all the studios to provide DVD-on-demand at retail. The last hurdle is deciding which content to license without upsetting existing retail partners," Polar Frog Chief Executive Todd Rosenbaum said. Studios initially will probably use the kiosks more to give older films a "longer tail" of availability, rather than offering new movies, for fear of upsetting existing retail partners and cannibalizing sales, said Kurt Scherf, principal analyst with Parks Associates. Rosenbaum added that the studios are not likely to discount the DVDs.

Scherf has projected on-demand DVDs will generate $1.3 billion in revenue by 2011. Studios generate about $24 billion a year from DVD sales and rentals.

Sonic Solutions Unveils DVD-On-Demand System

10.04.07

Novato's Sonic Solutions Inc. is hoping to revolutionize the way DVDs are sold with new technology that will let consumers burn their own copies of movies from a variety of sources. The technology lets consumers transfer movies and other content onto discs with the same patent protection carried by factory DVDs.

Recently, the DVD Copy Control Association announced a change in rules that opens the way for software developed by Sonic over the past three years to roll out its Qflix products. It provides retailers who are strapped with limited shelf space and consumers who have limited choices a new burn-to-order option. The downloads use software by Roxio - Sonic's consumer division - that allows consumers to copy content with their personal computing devices. The situation has prompted analysts such as JP Morgan and Canaccord Adams to upgrade Sonic Solutions' stock prospects. Sonic stock closed at $11.13 Thursday, about $3 more than when the news was announced. The stock price has ranged from $7.38 per share to $19.35 per share over the past year.

"We are extremely pleased that the universal standard has been defined by the industry and the stage finally set for the launch of new download-to-burn solutions that will provide consumers on-demand access to a wider selection of high-quality video entertainment," said Dave Habiger, president and chief executive of Sonic Solutions. "By creating a system that combines the convenience of electronic delivery with the simplicity and compatibility of DVD, we are helping the industry deliver to consumers a far greater range of content than ever before." Mark Ely, executive vice president for strategy, said the greatest challenge for DVD distribution today is manufacturing and distribution. Retailers tend to stock new releases, which are in demand for a short period and then replaced by the next round of hits. "It's not very efficient, so we came up with the idea of DVD on demand," Ely said. "We put DVD manufacturing as close to the consumer as possible."

The digital transfer technology vastly expands the availability of movies, television series and other content with its jukebox-like format.

"You can find any DVD easily," Ely said. "It enables consumers to find the content they want and download it economically. We're combining economics with portability and playability."

Packaged DVDs account for $26 billion and for 56 percent of filmed entertainment market, according to industry experts. On-demand video takes up just 2 percent of the market, but Sonic projects on-demand DVDs will claim a quarter of the 2 billion-DVD market by 2011. Ely said it took time to convince Hollywood to consider a new format but studios such as Universal, Paramount, Disney and Warner Bros. have approved the use of Qflix.

Sonic is working to license DVD kiosk makers, including the Scottsdale, Ariz.-based Polar Frog Digital LLC, the maker of the MediaIgloo. Its chief executive, Todd Rosenbaum, said Sonic has taken the DVD product to a new level with Qflix. Previously, consumers could illegally download content - but it often could not be played if the machines that were used did not recognize the protective coding. "Sonic wanted to capitalize on the market and created a version of that copy protection with Qflix," Rosenbaum said. "They have a dominant marketplace with Roxio."

Movie DVDs Sold At Kiosks Get A Boost

11.27.07

Wall Street Journal Story by Sarah McBride
A change in copy-protection rules governing DVDs is likely to quickly unlock a new market for selling movie discs via kiosks, where digital copies can be burned onto blank DVDs on the spot.

Retailers have been hoping to roll out such operations, giving instant access to thousands of movie titles that otherwise might be impractical to stock. But such plans have been tripped up by restrictive copy-protection guidelines. Some "on demand" burning is currently available, but it mostly involves independent titles.
A MediaIgloo kiosk
Now, an organization called the DVD Copy Control Association -- a consortium including movie studios and hardware makers that oversees the copy protection system known as Content Scramble System, or CSS -- says it will allow its technology to be licensed more broadly. That opens the doors for DVD-burning kiosks. One of the earliest licensing programs will come from Sonic Solutions Inc., of Novato, Calif., which is offering a copy-protection program called Qflix designed for burn-to-order DVDs. They are working to license it to DVD kiosk makers such as Polar Frog Digital LLC, which makes MediaIgloo kiosks. MediaIgloo in turn hopes to make deals with the major studios to acquire rights to their films. Retailers including Walgreens already have plans to install in-store movie kiosks. Having the big-studio content should help drive traffic to the kiosks, says Jim Taylor, senior vice president and general manager of Sonic's advanced technology group. "You need more compelling, topical studio content to get eyeballs there in the first place," he says. For studios, embracing the kiosks allows them to tap into their back catalog without having to produce and physically store DVDs.

"We've been pushing for years for people to be able to burn legitimate DVDs," says Michael Arrieta, executive vice president for digital distribution and mobile entertainment at Sony Corp.'s Sony Pictures. He adds that the company has about 500 movies already formatted for digital distribution, with new releases added as they come out on DVD and about 10 movies a month added from the catalog. Similarly, at Time Warner Inc.'s Warner Bros., a spokesman says the company supports the instant-DVD technology.

Stores, meanwhile, are eager to considerably broaden the movie titles they offer without taking up valuable shelf space.

The copy-protection technology will also work with at-home downloads, albeit only on designated blank discs and disc drives. While some studios had been experimenting with allowing consumers to burn DVD copies of movies they bought online, most played only on the computer; they didn't work in most DVD players because the movies come with a different type of copyright protection. The studios' insistence on CSS protections might seem fruitless since the software was cracked by hackers years ago; programs to circumvent it are widely available on the Internet. But Sonic says it's an important first line of defense "from casual disc copying."

DVD CCA Effective Date

09.20.07

Retailers and Consumers to be Able to Create Protected DVDs that Work with Existing DVD Players (MORGAN HILL, CA) – For the first time, commercial vendors and individual consumers will be able to legally create CSS copy-protected DVDs for playback on existing DVD players. The Board of Directors of the DVD Copy Control Association (DVD CCA) gave final approval for this innovative use of the technology late Wednesday.

With this new application of the Content Scramble System (CSS), the copy protection used on most commercially produced DVDs, vendors could, for example, create protected DVDs in custom runs at new on-demand factories or on store-based kiosks. Individual consumers will also be able to legally record a variety of content at home, including select movies, as offered by the content owners. In addition, consumers could obtain unusual, historical, or special content that is now unavailable on DVD because existing demand does not economically allow the mass reproduction today’s market requires. The process will use special blank DVD discs with CSS encryption. The copies will be compatible with millions of DVD players in homes and businesses today. “This important change is in direct response to industry and consumer demand for new legal alternatives for the creation and digital distribution of secure DVD content,” said Chris Cookson, Chairman of the DVD CCA Board. “Now that the process needed to enable this exciting capability is complete, we anticipate that new products and services will quickly appear in the marketplace.”

Polar Frog Digital Inks Deal for College Sports Programming

07.19.07

Polar Frog Digital, an entertainment leader in digital content management and distribution, expands its DVD Manufacturing On Demand library to include Collegiate Images’ college sports programming. Collegiate Images is the centralized licensing and rights clearance agency managing the distribution of copyrighted intellectual property content, focusing exclusively on college sports. In the deal, Polar Frog Digital will distribute programming from Collegiate Images including a variety of college sports for both men and women.

The launch of Polar Frog Digital’s Burn-On-Demand DVD kiosks will coincide with the start of college football season, where multiple programs will be made available. Currently, college football is one of the most popular spectator sports in the United States. As of 2007, records show that its audience is in the millions with its popularity exponentially on the rise. “We are looking forward to having Polar Frog as a distribution platform for our archived collegiate games,” said Dave Robertson, VP Sales, Collegiate Images. “Their burn-on-demand DVD kiosks will allow sports fans everywhere the opportunity to stay connected and watch their favorite college sports anywhere and anytime they want.” Polar Frog will deliver archived games through its MediaIgloo DVD kiosk solutions distributed throughout the U.S.

“We are very excited to work with Collegiate Images,” said Todd Rosenbaum, CEO for Polar Frog Digital. “With their vast library of college sports content, consumers will be able to watch the games they love over and over again. College sports fanatics everywhere will soon have a new way to keep up to speed with their favorite teams.” Polar Frog Digital is rapidly becoming the nation’s largest digital inventory enabler, offering vast DVD media libraries to retailers and e-tailers alike. The company’s patented MediaIgloo DVD kiosks are expanding throughout the U.S., making Polar Frog one of the leading names in DVD Manufacturing On Demand.
About Polar Frog Digital
Polar Frog Digital is a privately held limited liability corporation based in Scottsdale, Arizona. Our mission is to bring retailers the ability to expand core inventories while keeping costs at a minimum and raising profitability. Polar Frog Digital developed 'Self Service DVD burning Solutions' which allow custom DVDs to be manufactured on demand while the consumer waits. Polar Frog Digital is focused on creating the shortest, simplest consumer experience, while maintaining the standard DVD quality expected.

Polar Frog Digital Inks Deal with First Look Studios

07.17.07

Polar Frog Digital, an entertainment leader in digital content management and distribution, today announced a distribution deal with First Look Studios. Polar Frog Digital will have access to over 20 of First Look's premier titles adding to their already vast and expanding catalog. First Look Studios' content will be distributed through Polar Frog Digital's Burn-On-Demand Kiosks and come with copyright protection. Polar Frog's agreement with First Look is yet another victory for the Arizona-based company and adds to their continued success in creating marketing dominance in the Manufacturing of DVD on Demand sector. "Polar Frog Digital's goal is to expand its presence in the retail market by aligning ourselves with well-known studios in the entertainment industry," said Todd Rosenbaum, CEO of Polar Frog Digital. "Having access to more content through studios such as First Look will increase movies on demand for consumers and give them more options to purchase movies and television shows when they want it." "We are delighted to be doing business with Polar Frog," said Vince Muscarella, Manager of New Media for First Look Studios. "They are a solid company, with creative foresight and a good future in the marketplace." This joint venture will help to provide greater selection and maximize consumer satisfaction, creating a win-win situation for Polar Frog, First Look and consumers alike. Polar Frog Digital continues to distribute their MediaIgloo solution kiosks nationwide, currently located in various establishments including airports and other high-traffic locations.
About Polar Frog Digital
Polar Frog Digital is a privately held limited liability corporation based in Scottsdale, Arizona. Our mission is to bring retailers the ability to expand core inventories while keeping costs at a minimum and raising profitability. Polar Frog Digital developed 'Self Service DVD burning Solutions' which allow custom DVDs to be manufactured on demand while the consumer waits. Polar Frog Digital is focused on creating the shortest, simplest consumer experience, while maintaining the standard DVD quality expected. For more information on Polar Frog Digital, please contact us at 888-506-FROG or http://www.polarfrogdigital.com
About First Look Studios
First Look Studios is a leading independent studio which includes its wholly owned subsidiary, First Look Home Entertainment, Inc. and key operating divisions: First Look Pictures and First Look Television. The studios' CEO is Trevor Short, Dean Wilson is COO. The company is owned and operated by First Look Holdings, LLC. First Look Holdings, LLC was created in March of 2007 to acquire a controlling interest in First Look Studios. Its principals are Avi Lerner, Henry Winterstern, Danny Dimbort and Trevor Short.

First Look puts movies into DVD burning kiosks

07.17.07

By Susanne Ault
Download-to-burn specialist Polar Frog Digital has signed a distribution deal with First Look Studios. More than 20 First Look films will be available to customers in Polar Frog's manufacturing-on-demand kiosks. Exact titles were not specified.

These kiosks, branded MediaIgloos, allow people to download content for immediate burning onto copyright protected DVDs. The machines are available at various airports, among other locations. “Polar Frog Digital’s goal is to expand its presence in the retail market by aligning ourselves with well-known studios in the entertainment industry,” Polar Frog CEO Todd Rosenbaum said. “Having access to more content through studios such as First Look will increase movies-on-demand for consumers and give them more options to purchase movies and TV shows when they want it.” First Look manager of new media Vince Muscarella added, Polar Frog “is a solid company with creative foresight and a good future in the marketplace.”

The newly revamped First Look Studio also plans to mainstream its feature film releases in order to capture bigger revenue returns with the guidance from its new parent, Nu Image, which has built its production reputation on turning Steven Seagal and Jean-Claude Van Damme into popular action film stars. “In the past, First Look had been very arty,” said Trevor Short, CEO of First Look and a principal in Nu Image. “We will keep including these films, but we are moving further in that mainstream direction.” Upcoming mainstream examples include King of California, a comedy starring Michael Douglas, and Day of the Dead, a remake of the original 1985 horror flick. Launch dates have not yet been set. Most of Nu Image productions, which average about 15 a year, should be distributed by First Look under the new infrastructure.

The revamp, meanwhile, has not been without its bumps. A number of people have exited First Look's executive ranks, including a number of sales staffers. Short and chief operating officer Dean Wilson confirmed that more than five staffers have left the company in recent weeks, from the sales, marketing and finance departments. “We have change at this company across the board,” said Wilson. “This business has always had changes going on. This does not say anything [negative] about First Look. Nu Image/Millennium Films [taking a controlling interest in First Look in February] is the most noteworthy aspect to the company.”

Scottsdale's Polar Frog brings custom DVD kiosks to airport shops

07.10.07

A Scottsdale company is launching a third pilot program for its kiosks that allow people to burn custom DVDs from a library of thousands of movies and shows. Polar Frog Digital's latest deal for its Medialgloo kiosks is with The Paradies Shops stores at airports in Raleigh-Durham, N.C., and Burbank, Calif. The stores are part of The Paradies chain that operates more than 500 stores in 60 airports and hotels in the U.S. and Canada, according to a release issued by Polar Frog. A company spokeswoman said this is the third pilot for the kiosks since November with one of the earlier trials at Longs Drugs Stores. Paradies outlets at Phoenix Sky Harbor International Airport don't have space at this time for one of the kiosks, but other retailers are being courted, she said. "Early traffic and sales patterns indicate with the addition of major studio content the kiosks will be hugely successful," said Polar Frog Chief Executive Todd Rosenbaum in a statement about The Paradies launch. "Our MediaIgloo solution is just the beginning of Polar Frogs Manufacturing DVD On Demand business," he said. The Scottsdale company has seven employees.

Polar Frog Digital Moves DVD Burning Kiosks into Airports

07.10.07

By BusinessWire
Polar Frog Digital, an entertainment leader in digital content management and distribution pushes its DVD Manufacturing On-Demand solutions called MediaIgloo into airports. Kiosks have been placed in Raleigh Durham and Burbank airports at The Paradies Shops CNBC's branded stores. Polar Frog Digital will also launch its On-Demand kiosks at Detroit Metro by the end of July. The Paradies Shops operates over 500 stores in over 60 airports and hotels across the United States and Canada, serving more than a half-billion customers each year. These stores include original, one of a kind brands unique to individual airports, as well as national brands. The Paradies Shops are the third pilot program to launch since November 2006 for Polar Frog. Polar Frog Digital's innovative Manufacturing On-Demand solution is made possible through MediaIgloo, a state of the art solution that allows customers to browse from 1000s of movies and shows from a local source library and customize their own DVD within minutes. MediaIgloo is the first and only end-to-end process using a completely self-contained, self-service customizable burn-to-DVD software solution. Polar Frog Digital has licensed content from more than 50 studios and currently offers more than 5000 unique DVD titles to choose from. MediaIgloo's solution satisfies impulse shopping while expanding product availability and eliminating the need for physical inventories. "We are very pleased with the consumer responses and acceptance at The Paradies Shops; early traffic and sales patterns indicate with the addition of Major studio content the kiosks will be hugely successful. Our MediaIgloo solution is just the beginning of Polar Frogs Manufacturing DVD On Demand business," said Todd Rosenbaum, CEO, Polar Frog Digital. "Our MediaIgloo and related services provide an end-to-end solution for content owners and retailers alike. We offer the convenience of virtual inventories without traditional distribution costs, need for shelve space and satisfy a wider range of consumers." "We feel very positive with the recent progress on CSS copy protection becoming available and with the success of our growing library and pilot programs, the technology will only serve to enhance our solution," said Dameion Bryan, CTO, Polar Frog Digital.
About Polar Frog Digital
Polar Frog Digital is a privately held limited liability corporation based in Scottsdale, Arizona. Our mission is to bring retailers the ability to expand core inventories while keeping costs at a minimum and raising profitability. Polar Frog Digital developed 'Self Service DVD burning Solutions' which allow custom DVDs to be manufactured on demand while the consumer waits. Polar Frog Digital is focused on creating the shortest, simplest consumer experience, while maintaining the standard DVD quality expected.

Specifications for DVD-R for CSS burning approved

03.06.07

At the 37th Steering Committee meeting of the DVD Forum in Tokyo, DVD specifications for DVD Download Disc for CSS Managed Recording, revision 1.0, were approved. CSS is the Content Scrambling System used on commercially manufactured DVDs, and CSS licences are granted by the DVD CCA organisation. Managed CSS burning will initially only allow professional uses of custom burning solutions, including kiosks in retail stores where consumers can purchase and burn movies unavailable on DVD. Subsequently consumer in-home download-to-burn solutions for online movie services may follow. Special DVD discs (either pre-keyed or secure key writable) will need to be used to burn content.
Our take...
Whilst some online movie services (Cinemanow and Canalplay) offer consumers the chance to burn Hollywood movies to normal DVD-Video discs using the FluxDVD solution, some major content owners (notably Warner Bros and Twentieth Century Fox) are still awaiting the CSS-based solution before licensing their content for burning and playback on standalone DVD players. The fact that consumers will need to purchase special DVD discs may hinder take up of the in-home burn solution once it arrives.

Download DVD Specification Gets Approval

03.02.07

A technology that allows movies to be downloaded and burned to blank DVDs using the same content-protection system as commercial discs received official approval on Thursday. CSS Managed Recording was approved at a meeting of the DVD Forum in Tokyo, according to a source close to the forum. The technology will require discs that are slightly different from the conventional DVD-Rs found in shops today. The burned discs will be compatible with the vast majority of consumer DVD players, according to the DVD Copy Control Association (DVD CCA), which proposed the technology. The DVD CCA is responsible for licensing the CSS (Content Scrambling System) copy-protection system used on most commercial DVDs.

Despite Thursday's approval, services that allow consumers to legally download and burn movies in their own homes are unlikely to appear quickly. The DVD CCA said it will be initially restricted to professional uses. These might include kiosks in retail stores where consumers can purchase and burn discs in a controlled environment.

Such a system might offer commercial movies but could just as easily offer content that is unavailable on DVD today because the market for it is too small. With custom burning it could be profitable to offer such content. If such professional applications are successful then further services that allow consumers to download and burn in their home "are likely to follow," the DVD CCA said.

Sell DVDs, don't shelve them

02.19.07

Polar Frog Digital packs an entire DVD store into four cubic feet with its DVD-burning kiosk. St. Clair Interactive designed Polar Frog's software interface, allowing customers to edit their own DVDs and pull whole episodes or selected scenes from the database.

DVD burning desires - Download derby turns to disc pressing

02.12.07

By Ben Fritz
The battle to conquer America's living rooms with digital content heated up last week as Wal-Mart jumped into the movie download biz and players from Apple to Amazon.com to Microsoft moved to expand their offerings. But the next big show-down is likely to come over a piece of familiar hard-ware: the DVD player. After years of painful negotiations, tech companies will finally be able to offer the ability to burn DVDs of downloaded pics this year. Those discs could then be screened on any home DVD player. "This is very important to us because there's already a huge installed base of DVD players that connect to TV sets," says Jim Ramo, CEO of film download e-tailer Movielink. Web sites aren't the only ones itching for the technology.

Drugstore chain Wal-greens plans to expand its DVD offerings beyond a handful of discs to thousands by installing kiosks and DVD burners in all its stores. Consumers could order a disc and 10 or 15 minutes later, after getting their prescription, pick up a disc and box just like they would get at Best Buy. Consumers could also order movies online and pick them up instore. Wal-Mart is also work-ing on a DVD burning concept with HP, though it doesn't have deployment plans yet.

"There are about 65,000 DVDs that have been released," says Anthony Bay, chairman of MOD Systems, one of the companies bringing the technology to retailers. "Costco carries fewer than 200. Best Buy has about 4,000. Some stores don't have any. Now they can stock the kind of movies it never historically made sense to have on shelves." The technology isn't perfect. While burning isn't expected to take more than 10 or 15 minutes, most folks still have to wait more than an hour just to download a pic at home.

And initially, the home-burning technology only works with "DVD 5," a format that holds less data than the newer "DVD 9." That means some movies, along with all their extras, may not fit on a single disc, though insiders expect burning on a DVD 9 to be possible by next year. Another delay came as a result of Hollywood's ongoing piracy fears. Studios hoped to use something more advanced than the standard CSS encryption already in use, as the technology is easily defeated. But after years of political machinations, the studios finally endorsed technology that burns discs in CSS. Otherwise, it would have been impossible to burn discs that work on most people's DVD players. "If we used anything besides CSS, we would have compatibility issues and then we just wouldn't have a succesful format," says Tim Hogan, VP of digital distribution for Sonic Solutions, whose QFlix system is currently the only way to use the DVD Forum-approved technology in the market. Sonic is licensing QFlix to numerous companies, including MOD and Movielink, that want to enable DVD burning as soon as possible.

They're now working with studios to make titles available. In the case of Web stores, that means negotiating new rights -- and potentially new prices -- to let their consumers burn discs. For retailers, that means getting studios to give them digitized versions they can keep on an instore server to burn. "Right now it's impossible for a studio like ours with a big library to keep everything in stock," says MGM chief operating officer Rick Sands. "When you can get more people access to your production, you can more purely test demand without any other constraints."
Many studio execs remain cautious.
Some wonder whether many more titles will move when they're simply on a kiosk or computer screen and not being actively marketed. It also remains to be seen whether the overall impact will be additive, or simply shift some consumer spending toward library titles.
But studios aren't the only ones that stand to benefit.
Once shelf space constraints disappear, producers of indie pics and alternative content may get wider access to the tightly controlled DVD market. "If they can adapt a marketing strategy that gets their product noticed, this might make the most difference to small companies with less notable titles," says Stephen Prough, founder of investment bank Salem Partners, which has done several major deals involving film libraries. "They could generate significant dollars relative to their size."

Hollywood Studios Approve DVD Burning Kiosk Technology

02.05.07

By Mark Hefflinger
The major film studios have approved new technology that will allow retailers to burn DVDs on-demand from kiosks stocked with thousands more titles than would fit on their store shelves, the Financial Times reported. Approved by the DVD Forum, which represents major studios as well as hardware and software firms, the "DVD Download" format includes the copy-protection found on pre-recorded DVDs.

The kiosks, from providers including Lucidiom, MOD Systems, Polar Frog Digital, TitleMatch and YesVideo, will also print disc and case cover labels for consumers. Sonic Solutions, whose Qflix technology can enable kiosks to sell movies via DVD Download, told FT it is working with retailer Walgreens. "In the next three to four years, we expect 15-20 per cent of DVDs will become on-demand rather than being displayed on retailers' shelves," Mark Ely, head of Sonic's corporate strategy, told FT.

Film studios okay new DVD format

02.05.07

By Chris Nuttall
Major film studios have given their backing to a DVD format that will allow shops to compete better with online retailers by selling a far wider selection of films. The DVD Download format features copyright-protection software that will allow stores to burn any one of thousands of movies on to a DVD while customers wait. The format is expected to open the floodgates for stores to exploit the "long tail" of video content beyond bestsellers.

Online retailers had this market to themselves until now, selling less popular titles from their warehouses or through digital downloads. Shops only have room for a few hundred top-selling titles on their shelves but DVD Download kiosks being introduced this year will be able to access thousands of digitised movies, burn them to disks and print labels and covers. Film studios' concerns over possible illegal copying of the disks had been a sticking point for the launch of the kiosks.

These fears have been overcome by the same content protection system already used on pre-recorded DVDs. This is being incorporated into the new standard, known as DVD-R for CSS Managed Recording, or "DVD Download", according to its new logo. DVD-R is the format of the blank recordable media and CSS is the Content Scramble System of encryption that will be used. The format received final approval last week from the DVD Forum, a standards body with more than 200 hardware, software and media companies as members including Columbia, Sony, Universal, Walt Disney and Warner Brothers. Sonic Solutions, whose software is used to author about 80 per cent of the film industry's DVDs, introduced a licensing and certification programme last month for its Qflix technology, which provides the tools for media companies and retailers to take advantage of the new standard. It is working with the Walgreens store chain and kiosk providers Lucidiom, MOD Systems, Polar Frog Digital, TitleMatch and YesVideo. "There are 65,000 DVD titles available, but if you go to Wal-Mart you'll see maybe 1,400," said Anthony Bay, MOD Systems chairman.

"We're providing a technology platform that allows retailers to compete with online in catering for the long tail or building just-in-time inventory." Time Warner is planning to launch a download-and-burn service this year and is digitising and preparing its library of more than 6,000 films. "There are so many economic benefits for going to a digital inventory management and distribution system," said Mark Ely, Sonic's head of corporate strategy. "In the next three to four years, we expect 15-20 per cent of DVDs will become on-demand rather than being displayed on retailers' shelves."

Sonic Launches Technology and IP Licensing Program for Secure DVD-on-Demand

01.05.07

Major Firms Participate in Qflix™ Program to Enable CSS-Protected DVD Burning of Digitally Distributed Premium Entertainment

Sonic Solutions® (NASDAQ:SNIC), the leader in digital media software, today launched Qflix, a licensing and certification program to enable the legal, secure, and reliable burning of video content to DVDs playable on standard and high-definition players. The Qflix technology and intellectual property program empowers for the first time factory, in-store, and in-home systems for on-demand, electronic sell-through of movies and video programs that can be recorded to DVD with Content Scramble System (CSS) encryption. As the industry-approved content protection mechanism used on mass-produced discs and incorporated into all DVD players, CSS has been deemed essential by major content providers for the on-demand digital distribution of premium entertainment. The Qflix brand will appear on compatible drives, media, and video download services as a symbol for consumers looking for legitimate and reliable “purchase, download, and burn” home solutions. Sonic will be demonstrating Qflix solutions by appointment in its private meeting room at the Renaissance Hotel (Copa Conference Suite A and B) during the Consumer Electronics Show (CES), January 8th to the 12th, Las Vegas, NV. The Qflix licensing and certification program enables content owners, service providers, and manufacturers of media, PC DVD writers, network-connected DVD recorders, set-top boxes, and software to create reliable, compatible, and interoperable DVD-on-Demand solutions. The program involves a broad set of services that includes detailed technical information, certification testing, and an intellectual property license pool formed by Sonic and its technology partners to enable media and drive manufacturers to create optical discs and drives for recording CSS-encrypted video. “Warner Bros. is committed to giving consumers the widest range of choices to access our content in ways that recognize and protect its value,” said Chris Cookson, president, Warner Bros. Technical Operations and Chief Technology Officer, Warner Bros. Entertainment. “We are pleased and encouraged to see efforts like Sonic’s creation of Qflix that address the need for industry-standard protection.” Two different programs are being put into place: Qflix, for direct consumer use, and Qflix Pro, for enterprise use. Rolling out in early 2007, Qflix Pro will enable replication facilities to manufacture DVDs at the time of online order; reducing the cost of carrying physical inventory while simultaneously opening extensive catalogs of content. Qflix Pro will also enable new, self-service and retailer-managed movie kiosks that will be placed in stores to broaden the selection of available movies by augmenting physical product with a virtual inventory. “With placements in independent retail centers around the globe, Lucidiom’s innovative kiosk solutions have revolutionized photo finishing and creativity for millions of consumers and helped increase revenues for our partners,” said Stephen Giordano Jr., president, Lucidiom. “Through Qflix, Lucidiom will take a lead in redefining entertainment with customizable self-service movie kiosks that help reinforce our client’s brand and drive profitability.” “We are very excited to contribute to the creation of a new entertainment distribution method that will provide consumers a dynamic retail shopping experience,” said Todd Rosenbaum, CEO, Polar Frog Digital. “Through the Qflix Pro program, our self-service Media Igloo kiosks will be able to offer a vast assortment of titles, which will help further our mission to enable retailers to expand core inventories of high-volume items while keeping costs at a minimum and increasing profitability.” The consumer Qflix program will follow Qflix Pro and will support, promote, and extend the DVD Forum’s new disc format, which is mandated to be completed in January 2007. The consumer-branded Qflix program will empower manufacturers of DVD recorders and media, in addition to online movie delivery services, to establish secure, reliable, and compatible in-home solutions for recording downloaded entertainment on computers and consumer electronic devices such as set-top boxes, networked DVD recorders, and DVRs. “We are extremely pleased to participate in the Qflix program, which will provide our loyal customers a value added service, while ensuring copyright holders are adequately protected,” said Jim Ramo, CEO, Movielink. “Qflix provides another way for movies and our other premium programming to be downloaded via the Movielink broadband service to be played back on a TV - making access to the living room for the largest catalog of theatrically released VOD movies a reality. With the installed base of DVD players in over 80 million U.S. homes, internet delivery can now become a mass-market channel for movie distribution.” “The floodgates of digital distribution are about to burst, so now is the perfect time to provide an innovative technical solution that combines the advantages of electronic delivery with the simplicity and universal playback capabilities of CSS-protected DVDs,” said Jim Taylor, general manager of Sonic’s Advanced Technology Group. “Downloading to computers, portable devices, and internet-connected TV set-top boxes are all emerging pieces of the digital media ecosystem, but the entertainment value chain is incomplete without a cost-effective way to digitally deliver content that can be owned and viewed in the consumer’s entertainment venues of choice, including the living room. Qflix delivers this and opens many new channels for vast amounts of video programming such as TV shows, back-catalog movies, special interest programs, independent films, educational titles, and much, much more.” Initial Qflix program participants include drive manufacturer Plextor; media manufacturer Mitsubishi Kagaku Media (MKM)/Verbatim; kiosk manufacturers Lucidiom and Polar Frog Digital; in-store digital media solutions provider MOD Systems; digital content fulfillment provider TitleMatch Entertainment Group; end-to-end retail solutions provider YesVideo; retail on-demand disc publishing solution provider Rimage; retail and professional DVD and Blu-ray Disc publishing developers Primera Technology; duplication and printing system technology developer Microtech Systems; printing service provider Allied Vaughn; entertainment distributors Movielink and Akimbo; and the nation’s largest drugstore chain, Walgreens. Qflix implementation is made possible through Sonic’s comprehensive DVD On Demand™ technology platform. Sonic DVD On Demand provides an end-to-end solution for digital distribution, including a DRM gateway for secure export of content from approved download systems, precision video codecs that simultaneously convert Internet-delivered video into MPEG-2 video for DVD during the download process, automated DVD formatting tools for converting video into interactive DVDs, and an Extensible Media Protection Architecture (XMPA) that allows a wide variety of studio-approved copy protection mechanisms to be applied to DVDs as they are being burned. In addition to supporting CSS encryption through Qflix, Sonic DVD On Demand also integrates Macrovision’s RipGuard and ACP technologies, which provide a proven and comprehensive content protection solution that prevents the digital ripping and analog copying of DVDs. Sonic and Macrovision announced the integrated, “triple protection” solution in October of 2006.
About Sonic Solutions
Sonic Solutions (NASDAQ:SNIC)(http://www.sonic.com) is the leader in digital media software, providing a broad range of interoperable, platform-independent software tools and applications for creative professionals, business and home users, and technology partners. Sonic’s products range from advanced DVD authoring systems and interactive content delivery technologies used to produce the majority of Hollywood DVD film releases, to the award-winning Roxio®-branded CD and DVD creation, playback and backup solutions that have become the premier choice for consumers, prosumers and business users worldwide. Sonic products are globally available from major retailers, online at Sonic.com and Roxio.com, and are bundled with PCs, after-market drives and consumer electronic devices. Sonic’s digital media creation engine is the de facto standard and has been licensed by major software and hardware manufacturers, including Adobe, Microsoft, Scientific-Atlanta, Sony, and many others. Sonic Solutions is headquartered in Marin County, California. Sonic, the Sonic logo, Sonic Solutions, Qflix, DVD On Demand, and Roxio are trademarks or registered trademarks of Sonic Solutions or its subsidiaries in the United States and/or other countries. All other company or product names are trademarks of their respective owners.
Forward Looking Statements
The above paragraphs of this press release may contain forward looking statements that are based upon current expectations, including views regarding future DVD On Demand market opportunities and the potential benefits of the Qflix licensing and certification program. Actual results could differ materially from those projected in the forward looking statements as a result of various risks and uncertainties, including those discussed in the Company’s annual and quarterly reports on file with the Securities and Exchange Commission. This press release should be read in conjunction with the Company’s most recent annual report on Form 10-K, Form 10-Q and other reports on file with the Securities and Exchange Commission, which contain a more detailed discussion of the Company’s business including risks and uncertainties that may affect future results. The Company does not undertake to update any forward looking statements.

Sonic Solutions to introduce technology in Q1

01.05.07

By Jennifer Netherby
Sonic Solutions will commercially launch a download-to-burn program to allow in-home and in-store burning of movie downloads to DVDs in the first quarter. Dubbed Qflix, the program will be the first to allow burn-to-DVD using the same CSS copy-protection technology that is used on commercial DVDs. In late November, the DVD Forum approved a new type of recordable disc that will accept movies encrypted with CSS and playable on set-top DVD players. The move cleared the way for companies to begin offering download-to-burn with CSS protection. Movie download services Movielink and Akimbo; kiosk providers Polar Frog Digital, Lucidiom and MOD Systems; and drugstore chain Walgreens have all inked deals with Sonic to use the Qflix technology. The company also has deals with DVD drive manufacturer Plextor and disc publishers Rimage and Primera Technology to provide an end-to-end download-to-burn solution. “We’re making this announcement in part to show that there are a lot of companies and a lot of partners lined up and ready to go once we get all the final technical and licensing issues resolved,” said Jim Taylor, general manager of Sonic’s Advanced Technology Group. Among the details still pending is formal approval of the technical specs for the new discs that will be used for custom burning. That’s expected to happen at the DVD Forum’s Steering Committee meeting in Japan this month. Final details also are yet to be hammered out on changes to the CSS Master License needed to cover burning.

The original Master License, which is controled by Toshiba and Matsushita, the inventors of CSS, gave the DVD Copy Control Assn. the authority to license hardware and software manufacturers to use CSS for prerecorded discs and disc drives. If DVD-CCA is to be the agency to oversee the use of CSS in on-demand burning, the scope of its master license from Toshiba and Matsushita must be expanded. Toshiba and Matsushita have made formal commitments to complete the work on the master license by the end of January.

Movie download companies have been waiting for burn-to-DVD, believing that it will help jump-start the download business by offering consumers an easy way to watch movie downloads on their living room TV. But without the ability to use CSS encryption, content owners would have to rely on other forms of copy-protection, which can cause playability problems on some set-top DVD players. “With the installed base of DVD players in over 80 million U.S. homes, Internet delivery can now become a mass-market channel for movie distribution,” Movielink CEO Jim Ramo said. No studio has formally announced plans to license the Sonic system. However, Warner Bros. Entertainment chief technology office Chris Cookson offered words of praise for Sonic’s efforts. “Warner Bros. is committed to giving consumers the widest range of choices to access our content in ways that recognize and protect its value,” he said in a statement included in the Sonic news release. “We are pleased and encouraged to see efforts like Sonic’s creation of Qflix that address the need for industry-standard protection.” In addition to the software to manage the encrypted transmission and burning of downloaded content, Qflix includes as part of its licensing package most of the underlying IP rights needed to manufacture commercial DVDs on demand. “Qflix includes some of the joint IP pools, and with our partners, we hope to be able to announced those in a month or two,” Taylor said.

Hollywood Studios Sign Off On Download-to-DVD System

01.04.07

Hollywood studios have approved a new technology and licensing arrangement that should remove a major obstacle consumers now face with burning movies they buy digitally over the Internet onto a DVD that will play everywhere. On Thursday, Sonic Solutions Inc. introduced the Qflix system for adding a standard digital lock to DVDs burned in a computer or a retail kiosk.

The lock, known as the content scrambling system, or CSS, is backed by the studios, TV networks and other content creators and comes standard on prerecorded DVDs today. All DVD players come equipped with a CSS descrambler that allows for playback. But movie download services such as Movielink, CinemaNow and Amazon.com's (AMZN) Unbox haven't been able to use CSS because studios fear widespread DVD burning could lead to piracy. Studios have experimented with an alternative to CSS used by movie downloading service CinemaNow, but only a small number of titles are available for such burning and some users have complained of problems with playback. With Qflix — and its studio-backed copy-protection system — consumers should have more options. But they'll need new blank DVDs and compatible DVD burners to use it.

The system can also be used in retail kiosks, which could hold hundreds of thousands of older films and TV shows for which studios don't see a huge market. Customers could pick a film, TV episode or an entire season's worth of shows and have them transferred to DVD on the spot. Burning a DVD will take anywhere from 10 to 15 minutes using Sonic's technology, the company said. Consumers still would be subject to restrictions placed by the movie service and studios.

For instance, using the copy-protection technology in Microsoft Corp.'s (MSFT) Windows Media system, a service could specify that a given title can be burned no more than two times. Sonic has been working for three years to develop the technology and get studios to agree to amend the CSS license to allow a "download to burn" option.

"We are pleased and encouraged to see efforts like Sonic's creation of Qflix that addresses the need for industry standard protection," Chris Cookson, chief technology officer at Warner Bros., said in a statement. The initial companies participating in Qflix include Verbatim Corp., which makes blank discs, the movie download service Movielink, video-on-demand provider Akimbo Systems Inc. and the Walgreen Co. (WAG) chain of drug stores. Studios must still figure out pricing schemes that appeal to consumers and protect its lucrative retail business. Some retailers, such as Wal-Mart (WMT), have talked about starting their own online downloading services or installing kiosks to burn DVDs in the store. Also, most consumers will need a new DVD burner that includes the latest software. Some burners can be updated, Sonic said, and companies such as Plextor, a Qflix partner, are expected to market Qflix-enabled DVD burners that connect with a USB cable.

Studios Approve DVD Burning Technology

01.04.07

By Ed Oswald
The ability to burn legally downloaded movies to DVD came one step closer to reality Thursday, as a studio-approved system to prevent piracy was introduced. However, there are still obstacles preventing widespread usage. Called Qflix, the technology was produced by digital media software company Sonic Solutions. Compatible drives, media, and video services will display the Qflix logo to allow consumers to identify who supports the new technology.

The technology that powers the Qflix system is called Content Scramble System (CSS) encryption. While CSS has already been used in pre-recorded DVDs today, content owners have been reluctant to allow it to be used publicly for fear of it being cracked. Qflix will offer a secure way for this to be done at home, as well as allowing publishers to place restrictions on content, such as how many times they will allow a download to be burned to DVD. Missing from Thursday's announcement are any actual hardware or software announcements. Although disc drive manufacturer Plextor, along with several media manufacturers have announced their support for the initiative, none have announced consumer availability of products. Instead, it appears that the first usage of the technology will be on the enterprise side of the market. A version of the technology called Qflix Pro will allow for the manufacture of DVDs at the time of order, opening up new possibilities for retailers, such as in-store kiosks. At least one supporter of the technology, drug store chain Walgreens, is likely to use the technology for exactly that reason. By using kiosks rather than stocking large inventories of pre-recorded DVDs, retailers could save a lot of money, say backers of the format. Jim Taylor, general manager of Sonic's Advanced Technology Group, says that now is a perfect time to offer a solution like Qflix. "The floodgates of digital distribution are about to burst," he argued. "Qflix delivers this and opens many new channels for vast amounts of video programming such as TV shows, back-catalog movies, special interest programs, independent films, educational titles, and much, much more," Taylor added. The movie studios have so-far praised Sonic's efforts. ""We are pleased and encouraged to see efforts like Sonic's creation of Qflix that address the need for industry-standard protection," Warner Bros. Entertainment Chief Technology Officer Chris Cookson said.

01.04.07

by Dela
The main problem with many of today's online video download services is the majority lack a burning features, which locks a movie to a PC and whatever display and audio equipment it feeds to. CinemaNow has had a burning option for very few of its titles but there have been reported complaints regarding playback issues. Now the movie studios have approved a new system that uses an old content protection. Sonic Solutions Inc. will introduce its Qflix system on Thursday which can be used to burn movies bought over the Internet or used with Kiosks. Specifically, the system burns DVDs that are protected with Content Scrambling System (CSS), the same weak scheme used with the majority of retail DVDs to date. Surely there is some other form of content protection included to prevent easy copying. However, this is still not exactly what consumers are looking for as it is reported that consumers will need "new blank DVDs and compatible DVD burners to use it". I guess it remains to be seen what exactly that means in practice. The company also said that burning a disc using the system will take about 10 or 15 minutes. Enabling its usage with Kiosks is interesting though; allowing consumers to possibly choose from thousands of movies and TV shows to make custom discs.

UPDATE: Some more details to give. Customers will still be subject to restrictions on their downloads, such as a burn limit, but the resulting burn does in fact contain the same CSS protection as seen on regular DVDs. "We are pleased and encouraged to see efforts like Sonic's creation of Qflix that addresses the need for industry standard protection," Chris Cookson, chief technology officer at Warner Bros. said in a statement. Several companies are participating with Qflix including Verbatim (makes blank media), MovieLink, Akimbo Systems Inc. and the Walgreen Co. chain of drug stores. Sonic also explained that some DVD burners can be updated to support the service and companies such as Plextor, a Qflix partner, will market compatible DVD burners.

Studios okay users burning CSS-encrypted movies, but special media is required

01.04.07

by Nate Anderson
Movie download services have been hamstrung, kneecapped, and hobbled (choose your favorite leg-related metaphor) by their general inability to burn movies to DVD. It's hard to believe that this is such a big deal in 2007, with next-generation optical formats already on the market and the standard DVD encryption cracked long ago, but such is the way of things. Current burn-to-disc solutions do exist, but minor problems like widespread incompatibility with DVD players have limited their appeal. But finally, more than a decade after DVD was released, Sonic Solutions is ready to bring real DVD-burning movie madness to consumers—and to Walgreens. The company (which also owns the consumer brand Roxio) has created the Qflix licensing program that will allows consumers and in-store kiosks to burn fully-compliant, CSS-encrypted DVDs, and today they announced their first set of technology partners. Warner Bros. is on board, as is movie download service Movielink. Kiosk manufacturers have also signed on, and hardware companies like Plextor have agreed to tweak their burners to support the technology. Even Verbatim, a blank DVD manufacturer, has joined the Qflix program. Why so many different kinds of firms? Because Qflix requires a complete end-to-end system in order to function. Content providers must agree to having their content made available for DVD burning and download services must support the new standard. Burning software must be modified to handle Qflix, DVD recorders must be upgraded (some can do this with a firmware update), secure key servers must be deployed, and—we're not kidding—special Qflix-enabled recordable media must be purchased and used. And you thought this was going to be easy! Now, to be fair, much of this work will should take place away from consumers' eyes. Movelink users shouldn't need to do anything more than pick up a special set of blank discs and update the firmware on their burners—though this still seems like an awful lot of work just to load discs down with a trivial-to-hack encryption scheme. Actually, Qflix won't just support CSS but Macrovisions's Ripguard and APC as well, two technologies designed to prevent the ripping of DVDs and analog copying. Producing fully-compliant CSS DVDs should prevent most of the compatibility problems that have plagued past burn-to-disk solutions and will open the market to burn-on-demand services in stores like Walgreens (a US pharmacy/cosmetics/jug-of-milk chain of stores). Kiosks can burn single copies of obscure films that are too expensive to mass-produce, store, and ship. Jim Taylor, a Sonic general manager, believes the service will be useful for "TV shows, back-catalog movies, special interest programs, independent films, educational titles, and much, much more." The move was made possible because the DVD Copy Control Association loosened its rules last August.

Though it won't put a stop to illicit BitTorrent downloads, the new system at least expands consumer options and, for the first time, brings fully-compliant DVD burning to the unwashed masses. Is this a bold step forward, or too little, too late?

Studios embrace copying technology

01.04.07

By Gary Gentile of Associated Press
Hollywood studios have approved a technology and licensing arrangement that should remove a major obstacle consumers now face with burning movies they buy digitally over the Internet onto a DVD that will play everywhere. Sonic Solutions is introducing today the Qflix system for adding a standard digital lock to DVDs burned in a computer or a retail kiosk.

The lock, known as ''content scrambling system,'' or CSS, is backed by the studios, TV networks and other content creators and comes standard on prerecorded DVDs today. All DVD players come equipped with a key that fits the lock and allows for playback. But movie download services such as Movielink, CinemaNow and Amazon.com's Unbox have not been able to use CSS because studios fear widespread DVD burning could lead to piracy.
OTHER OPTIONS
Studios have experimented with an alternative to CSS used by movie downloading service CinemaNow, but only a small number of titles are available for such burning and some users have complained of problems with playback. With Qflix -- and its studio-backed copy-protection system -- consumers should have more options. But they will need new blank DVDs and compatible DVD burners to use it. The system can also be used in retail kiosks, which could hold hundreds of thousands of older films and TV shows for which studios do not see a huge market. Customers could pick a film, TV episode or an entire season's worth of shows and have them transferred to DVD on the spot. Burning a DVD will take anywhere from 10 to 15 minutes using Sonic's technology, the company said. Consumers still would be subject to restrictions placed by the movie service and studios. For instance, using the copy-protection technology in Microsoft's Windows Media system, a service could specify that a given title can be burned no more than two times. Sonic has been working for three years to develop the technology and get studios to agree to amend the CSS license to allow a ''download to burn'' option.
INDUSTRY APPROVAL
''We are pleased and encouraged to see efforts like Sonic's creation of Qflix that addresses the need for industry standard protection,'' Chris Cookson, chief technology officer at Warner Bros. said in a statement. The initial companies participating in Qflix include Verbatim, which makes blank discs; the movie download service Movielink; video-on-demand provider Akimbo Systems; and the Walgreen chain of drug stores. Studios must still figure out pricing schemes that appeal to consumers and protect its lucrative retail business.

Sonic unveils anti-copying technology for movies burned to DVDs

01.04.07

By Antone Gonsalves of InformationWeek
Sonic Solutions unveiled copy-protection technology designed to prevent illegal copying of movies downloaded from the Internet and burned to DVD. Sonic, based in Novato, Calif., said Thursday the Qflix technology will be available in the first half of the year to manufacturers of home computers and digital video recorders. The company plans to launch a licensing and certification program that would place the Qflix brand on devices, discs and download services supporting the technology. Full-length movies available on the Web for burning to DVDs remain scarce, in part, because of Hollywood's fear of piracy. However, such Web services could help boost DVD sales, because it would make it possible for people to watch the movies on their TVs, a vehicle most consumers prefer to the smaller screens of their computers. Sonic's technology would provide the same protection found on store-bought discs to those used to copy movies, Jim Taylor, senior vice president and general manager of Sonic's advanced technology group, said. This is accomplished by recording the DVD with the same Content Scramble System, the encryption method used in commercial production. "A legitimate download and burn solution that gives studios the same protection as prepackaged titles could make a big difference in what they make available online to consumers," Taylor said. CSS prevents copying of store-bought DVDs, but it isn't foolproof. Hackers have managed to break the system at times by developing decryption software.

For the Sonic technology to work, it would need to be in the video recorder, and the consumer would have to buy supporting DVDs. Along with encrypting the content, Sonic's software would also copy over the original digital rights management technology contained in the downloaded file, so that terms of use could be carried over. For example, a movie service provider could allow the movie to be copied a set number of times. While falling short of a full endorsement, Warner Bros. Entertainment said in a statement that it was "pleased and encouraged to see efforts like Sonic's creation of Qflix that address the need for industry-standard protection." Besides online burn-to-DVD services, Sonic believes its technology, which has taken three years to develop, would be useful to companies planning to offer in-store movie kiosks where a consumer could go to get a copy of a movie not available on the shelves. Companies that have agreed to license Sonic's technology include DVD drive manufacturer Plextor, Mitsubishi Kagaku Media (MKM)/Verbatim, which makes optical discs for recording high-definition content; kiosk makers Lucidiom and Polar Frog Digital; online move service Movielink; Walgreens drugstore chain; and others. Sonic plans to demonstrate its technology next week at the Consumer Electronics Show in Las Vegas, Nev.

2006 - Year of the Tad

Sonic Solutions, Macrovision devise retail DVD burn system

10.10.06

by Dan Bell
Looks like Macrovision is is joining up with Sonic Solutions to provide a quick way for consumers to pick and burn a DVD at the local market. How fast is quick? 10 minutes! The resulting disc, dubbed DVD On Demand, is of reportedly the same quality as a normal pressed DVD and comes packed with CSS DRM that studios demand. From the press release over at Sonic: "The solution will integrate Macrovision's RipGuard and ACP technologies into Sonic's DVD On Demand™ technology solution, which will allow content encrypted with the industry-standard Content Scramble System (CSS) found on mass-replicated DVDs to be recorded directly to optical DVD media. Sonic will license the new combined solution to video publishers and distributors."  Sonic developed the DVD-burning side of the deal while Macrovision has supplied the copy-protection. Now together, they have transmogrified their technologies to create DVD on demand! Offering DVDs from kiosks could become another avenue to distribute movies, analysts said, especially because most people are still more comfortable with DVDs than online downloads.

"I wouldn't be surprised to see kiosks by the next holiday season," said Kurt Scherf, principal analyst at Parks Associates. "This is an era of experimentation for (movie studios). They're trying to figure out what works and who their partners are. They're testing the waters." Corey Ferengul, Macrovision's vice president of solutions and strategies, said he expects online retailers to be the first to offer the service, which will allow them to sell independent, older and lesser-known movies without needing to warehouse them. In time, retail stores could also begin installing DVD-burning kiosks.

"We don't think it's going to replace physical DVDs in the store, but this could change the layout of the DVD section," Ferengul said. This would be a great idea, if the kiosk could hold several terabytes of movies. This way, people might be able to find hard to get films, that many retailers would be hesitant to display on their valuable shelf space. As long ads the DVDs work as well as present pressed forms, this should indeed compliment the inventories that are available.

Partnership could mean quick DVDs

10.09.06

By Ellen Lee
A partnership between two Bay Area technology companies may help pave the way for people to be able to walk into a store, order a movie and have it burned onto a DVD in 10 minutes. Santa Clara's Sonic Solutions and Novato's Macrovision Corp. are expected to announce today that they have jointly developed technology that burns DVDs with the same quality as regular DVDs and the same copyright protection that Hollywood studios demand. It marks a critical step toward setting up DVD-burning kiosks in retail stores, something that has been talked about for years. And it could eventually make available thousands of movies that have never been on DVD and allow retailers -- both online and in your neighborhood -- to sell a wider variety of movies and television shows. "The traditional way of manufacturing discs, shipping discs and storing them on a shelf inevitably creates the problem of limited inventory," said Chris Cookson, chairman of the DVD Copy Control Association, a group of movie studios and technology companies that manages the making of DVDs. He's also the chief technology officer for Warner Bros. Entertainment. "No store can really afford to have copies in stock of every movie that has ever been distributed. (But with new technology), customers could potentially buy titles they always wanted but never could find." Sonic develops DVD-burning technology while Macrovision has supplied copy-protection software for years to major Hollywood studios such as Disney and Universal.

Now the companies have jointly developed a technology that allows DVDs to be created on demand. The two companies are negotiating to sell the system to retailers. Retailers, meanwhile, are negotiating to secure the movie rights from the studios. Sonic and Macrovision declined to name the retailers or studios involved, but said they expect to make an announcement later this year. Movie studios are looking for ways to make money now that DVD sales have begun to level off and are trying out a number of technologies to reach people who are turning to the Internet for entertainment and who want to be able to watch movies not only on television sets, but also on computers and portable devices. Just last month, both Apple's iTunes and Amazon's Unbox began selling online movie downloads. Offering DVDs from kiosks could become another avenue to distribute movies, analysts said, especially because most people are still more comfortable with DVDs than online downloads.

"I wouldn't be surprised to see kiosks by the next holiday season," said Kurt Scherf, principal analyst at Parks Associates. "This is an era of experimentation for (movie studios). They're trying to figure out what works and who their partners are. They're testing the waters." Corey Ferengul, Macrovision's vice president of solutions and strategies, said he expects online retailers to be the first to offer the service, which will allow them to sell independent, older and lesser-known movies without needing to warehouse them. In time, retail stores could also begin installing DVD-burning kiosks.

"We don't think it's going to replace physical DVDs in the store, but this could change the layout of the DVD section," Ferengul said. DVDs have typically been produced in mass quantities in manufacturing plants. But the DVD Copy Control Association passed new rules this summer that for the first time allow copyrighted DVDs to be burned in kiosks and individually, so that even the most obscure titles have a chance of becoming a DVD. "This is a first step in terms of the technology," said Michael Gartenberg, an analyst at Jupiter Research. Until now, "no one had the right level of copyright-management software combined with security managers to get the studios on board. (Now) there is a reason for them get on board."

What's Holding up Movie Downloads

10.01.06

Jon Healey, JON HEALEY of the Times
IT'S A FAMILIAR story line in Hollywood: An innovative high-tech company unveils a revolutionary new way to sell entertainment, only to be waylaid by giant retailers that don't want to disturb the old ways. This kind of conflict delayed videotapes and DVDs, doomed CD-burning kiosks, slowed the development of downloadable music stores — and now it's affecting the nascent downloadable movie business. Apple Computer unveiled its long-awaited online movie store Sept. 12, offering for $10 to $15 feature films that could be played on a Mac, a PC or a video iPod (or all of the above). It also showed off a prototype of a TV converter box that would let viewers beam the films they buy from Apple from their computer to their TV set. But despite the hype, the shelves at the iTunes store were relatively bare, offering only 75 movies, all from Disney and its subsidiaries. By contrast, when Apple launched its iTunes Music Store in April 2003, it had more than 200,000 songs from all five of the major record companies and top independent labels. Where were the rest of the studios? Some reports blamed their absence on Wal-Mart and other big retailers, the partners that Hollywood can scarcely afford to alienate. It's a symbiotic relationship: New DVD releases drive shoppers into the stores, and the resulting sales — with profit margins about 80% — drive up the studios' revenues. Thanks to aggressive pricing by Wal-Mart and other large retailers, DVD sales have become the lifeblood of the film business, accounting for more than 40% of the studios' revenue, according to analyst Jan Saxton at Adams Media Research. By contrast, downloadable movie sales are expected to account for less than $12 million this year, Saxton said. Studios make five times that amount from DVD sales and rentals every day. The studios' reasons for withholding movies from iTunes are more complicated than that, however. Yes, they're leery of anything that could dim Wal-Mart, Best Buy and Target's enthusiasm for selling DVDs. But there are two other factors that pose an even larger hurdle to the sale of downloadable movies: technology and profit margins. The concept of an online movie store with unlimited shelf space should be appealing to any movie buff who's ever left a video store empty-handed. But today, there's no easy way to watch a downloaded movie on your TV. With rare exceptions, sets can't simply be plugged into a modem or home network, nor can the set-top boxes provided by cable and satellite TV services. That situation is starting to change — for example, Echostar plans a Dish Network receiver that can get downloadable movies from CinemaNow, and Apple plans to sell its $300 converter box next year — but it may take years before these devices proliferate and connect the average living-room TV to the Internet. Apple's video iPods can already bridge that gap. People who buy TV shows or Disney movies from Apple can transfer those files to a video iPod, then use a $19 adapter to connect the iPod to a TV. But several studios recoil from this approach because it leaves their downloads, which are scrambled to deter piracy, open to bootlegging. Someone could connect the iPod to a digital recorder instead of a TV and crank out unlimited copies of the movies they buy. The studios want Apple to require a specialized, secure connection between the computer and the TV, a concession Apple has not been willing to make on its iPods or, apparently, its converter boxes. Apple probably wants to know why, given that conventional DVDs are just as vulnerable to that kind of copying, it should be required to take such costly and user-unfriendly security precautions. The simplest approach to moving a downloaded movie to the TV would be to burn it onto a DVD that could play on a conventional DVD player. But Hollywood has insisted that the discs have electronic locks to limit copying, just as packaged DVDs do. This is no mean feat; conventional players can handle only one kind of lock, and today's DVD burners aren't equipped with them. There are some emerging technologies that can solve this problem, but either the studios have been reluctant to try them on new releases or the tech and entertainment industries have been slow to deploy them. Summing up the technical landscape for downloadable movies, analyst Josh Bernoff of Forrester Research said that "there's not going to be enough people with the right devices to have an enjoyable experience for three to five years." Apple Chief Executive Steve Jobs also pressed the studios to cut their wholesale prices sharply so he could sell downloadable movies for $10. That's $6 to $8 less than the studios demand for a new-release DVD. Many studio executives fear that movie buyers will simply replace DVDs with downloads. They want to keep profit margins the same for both types of product. Given the relatively small difference in cost between a mass-produced DVD and a downloadable movie (as little as $2 to $3, analysts and studio executives say), studios are looking for wholesale prices of about $14 or $15. Throw on another dollar or two for the retailer, and a downloadable film doesn't seem like much of a bargain — especially when there's no easy way to watch it on TV or make a permanent copy. In spite of all these impediments, Apple still managed to sell more than 125,000 Disney movies in its first week, generating about $1 million for the studio. The store's sales dwarfed those at all other downloadable movie outlets, suggesting that Apple was once again succeeding where its predecessors had failed. Still, the chances of Apple revolutionizing the way people buy movies as quickly as it did with music are slim, given the critical differences between those markets. Simply put, the music industry was ready for change when Apple launched its iTunes Music Store in 2003 — millions of people were already downloading tunes and using their computers as jukeboxes, and the sharp drop in CD sales made the labels receptive to Apple's terms. Apple also was already selling a device that perfectly captured all the benefits of the change from CDs to downloadable tunes. That's not the case with movies. Downloadable movies may ultimately prove to be more compelling than DVDs, but they're not today — either for Hollywood or the average movie buff.

Hollywood to relax DVD security standard

09.05.06

By James Bickers and Scott Slucher
Pop the movie Memento in your DVD player and you’re treated to a bewilderingly complex maze of clues, voices, red herrings and possibilities. Multiple viewings are most certainly required. Attempt to make sense of the Aug. 3 announcement from the non-profit DVD Copy Control Association about a policy change that seems to relax the security scheme at the heart of the DVD format, and you’re up for a similar challenge. Both stories are teeming with facts and hints, some of them contradictory. And both promise great reward, if only you can make sense of it all.
Cracking the CSS code
Much like the storyline in Memento, burn-on-demand has been a puzzle that many companies have tried to crack. Content selection, technological issues related to burning and most of all licensing hurdles have raised question marks over the brows of countless kiosk designers. Confounding the problem is the fact that digital entertainment can be delivered in so many ways, to so many devices; for instance, music-burning kiosks won’t just compete with one another, they’ll also compete with the Internet, satellite radio and other more traditional distribution channels. For movies, the road has been even rougher, at least when it comes to mainstream content. Greg Larsen, spokesperson for DVD CCA, said Hollywood was not willing to issue its content in digital format until it was assured that it couldn’t be duplicated â€” after all, unlike analog recordings which lose quality with each successive copy, a digital version of a movie could give birth to an infinite number of perfect duplicates. That gave rise to the formation of the DVD CCA in 1999. The non-profit organization, which also maintains the standard for the "region code" system that prevents discs from being played in certain geographic areas, oversees licensing for the Content Scramble System, or CSS. CSS is a digital rights management scheme that aims to prevent the copying of material via encryption; the movie data, including extra features and menus, is encrypted at the manufacturing plant when the disc is created, then decrypted when viewed in a DVD player. Although CSS protection is notoriously weak â€” it was cracked in 1999 by famed hacker Jon Johansen â€” it is still the prevailing security scheme used for commercial DVD manufacture. Larsen said most commercially available DVDs are manufactured with CSS encryption. That will change with the coming of HD-DVD and Blu-ray, both of which have already adopted a new, stronger encryption method, but for the time being, any business that wants to sell content on DVD, and have the assurance that it will play in any player bearing the DVD logo, needs to encode that content with CSS. Up to this point, encoding a DVD with CSS meant sending it to a commercial DVD manufacturing plant â€” which is cost-prohibitive for small runs and specialty films. And that’s why the August 3rd announcement, which states "under rule changes now in the works, commercial vendors could create protected DVDs on kiosks and in small custom runs," might be very big news for retailers and kiosk manufacturers alike.
A ‘gold rush’ for kiosk owners?
Or, frankly, it might not. Opinion is still divided about whether burn-on-demand DVD kiosks will make much of an impression on consumers, who are already inundated with buying options for every form of entertainment imaginable. Francie Mendelsohn, kiosk industry analyst and president of Summit Research Associates, said overall trends in the sale and use of entertainment do not bode well for a business model that dispenses a physical item. "People are already starting to write the epitaph for CDs â€” most people aren’t getting their music that way any more," she said. "Are you really going to need DVDs way into the future? In the short term it might be okay, but in the long term, so what? It’s not going to be the way most people are holding their data anymore." To Chris Peter, marketing and operations manager for St. Clair Interactive Systems, the bottom line is a technological one. His company has whittled the burn-time for a single disc down to 5 to 6 minutes; if it takes much longer than that, people are not likely to stand around and wait. He is concerned that encoding the content for CSS will add time to that process. "If it doesn’t affect the burn times, then yes, it’s a gold rush," Peter said. "If it requires another step in the authoring process, then I don’t think it’s much of a big deal to anybody." Burning CSS-compliant movies also involves a change in the blank media used. Larsen pointed out that CSS discs have a key component of the encryption scheme manufactured into them, so the kiosks would have to be loaded with special CSS "blanks." Off-the-shelf DVD blanks won’t be sufficient. Larsen envisions the CSS-enabled kiosk as a tool to fill specific niches that have been underserved. For instance, he said old movies could be accumulated into genre-specific machines â€” one kiosk for classic Westerns, one for classic sci-fi, all of which (presumably) have an audience but not a big enough one to merit a commercial pressing. As for when all of this might come to pass, Larsen said he couldn’t be specific, but the newly revised CSS specification should be available "in the near future." Among the companies dabbling in movie-burning kiosks is HP, which displayed its "Media on Demand" kiosk at Retail Systems 2006. Representatives from HP could not be reached for comment about how the CSS announcement might affect the company’s strategy.
Going outside the mainstream
The non-availability of CSS has forced companies to be resourceful, exploring burn-on-demand as a business model without Hollywood content. According to Peter, St. Clair currently has 20 to 30 DVD-burning kiosks in pilot, with a second stage expected to launch in September. He said it has been a success so far, even without big-budget films. Those kiosks are owned and operated by Polar Frog Digital, which is licensing adult content and placing the machines in adult bookstores and strip clubs. The MediaToad, launched in January, gives bookstore patrons a menu of hundreds of scenes that can be selected, sequenced and burned as desired. In strip clubs, the kiosks are loaded with content featuring the in-house dancers, so visitors can take home a memento of their own. The bar for licensing adult content â€” as well as the cost â€” is considerably lower than mainstream Hollywood fare. Even so, Polar Frog CEO Todd Rosenbaum said the company is moving toward kiosks that offer non-adult media. In July, the company unveiled the MediaIgloo, which sells content from independent producers eager to reach a wider audience. The machine holds nearly 800 movies or 3,000 TV episodes.

Security spec near for burning downloaded movies to DVDs

08.14.06

By Antone Gonsalves of TechWeb
The DVD Copy Control Association appears ready to lighten certain restrictions..

The association responsible for copy-protection technology found in most commercial DVDs has finished an adaptation of the specification that could be used in burning to disks from the Web. The DVD Copy Control Association is in the final stages of approving the changes in the Content Scramble System that were given the OK this week by the group's Content Protection Advisory Council. Approval by the CCA board is expected "relatively soon," spokesman Greg Larsen said Friday. Members of the CCA board include an equal number of representatives from the motion picture, consumer electronics and PC industries. All the major players in each group are CSS licensees, Larsen said. In general, the technology encrypts DVD content to prevent it from being copied to another disk. The recent adaptation would make it possible to provide copy protection to movies downloaded from the Web and burned to a CSS-enabled DVD. The same security spec would also have to be embedded in the DVD player, in order to play the movie. CSS has been in use since 1996, and is found in nearly all DVDs, players and PCs. Its ubiquity positions the adaptation for widespread adoption, Larsen said.

"This is about enabling commercial vendors to distribute DVDs in ways they couldn't do before," Larsen said. "We want to make sure the DVDs are of the high quality and full-feature capability that consumers have grown accustomed to with legitimate DVDs." Hollywood is moving cautiously toward the Web, delivering mostly older TV shows and movies. Most, however, still can't be burned to DVDs and played on a TV, the device most consumers prefer to watch movies, analysts say. But recent announcements from online movie distributors CinemaNow and MovieLink indicate that movie studios are ready to move forward with DVD-burning services. CinemanNow is offering such a service for a small number of older movies, using copy-protection technology other than CSS. MovieLink has announced plans to offer a similar service, and is expected to adopt CSS. The DVD CCA expects to see its latest spec show up first in commercial kiosks in malls or other retail areas. Consumers would be able to choose from a list of content, such as historical footage or old movies, that no longer are in mass reproduction. Eventually, however, movie studies are expected to use CSS to distribute over the Web.

"How quickly it gets out is beyond the scope of the DVD CCA," Larsen said. "The marketplace will determine how quickly it gets out there."

Burning movies onto DVDs may be getting easier

08.13.06

A film industry group is set to remove some of the procedural hurdles that prevented the legal recording of movies onto blank DVDs in a further sign that Hollywood studios are preparing to expand what consumers can do with downloadable movies. Under rule changes expected to be finalized soon by the DVD Copy Control Association, retailers could create movie jukebox kiosks with which customers can select, say, an obscure title and burn it to a DVD on the spot. Online merchants, like Apple Computer Inc.'s iTunes Music Store, could start to allow video downloads to be transferred onto DVDs.

The impending technical and policy changes involve the copy group's proprietary technology known as the Content Scramble System, or CSS. The association, an arm of Hollywood studios, licenses the encryption technology to makers of DVD players and other electronics companies and applies it widely to movies on DVDs to restrict illegal copying. The association said it will soon expand licensing to movies that are digitally distributed on demand or a la carte - and not just for movies that are mass produced on DVDs. The group also is working with disc makers to produce CSS-compatible blank DVDs.

Hollywood studios have been experimenting more with digital distribution. But until recently, they have been reluctant to allow consumers to transfer online purchases onto DVDs, limiting playback largely to computers or entertainment systems that are linked to a computer network. Google has high hopes for spyware buster: Google is issuing this warning to people who try to click on links to sites with spyware and other malicious code: "The site you are about to visit may harm your computer!" Users can search again, learn more about malicious code at the site StopBadware.org or proceed to the suspect site anyhow - at their own risk, of course. Google Inc. said its initiative is just starting and is by no means comprehensive.

Google is one of the main sponsors of StopBadware.org, a project that researchers from Harvard and Oxford universities are hoping to turn into a clearinghouse for information on spyware and other malicious software. So far, StopBadware has identified only one site as malicious, and efforts to reach that site from Google worked normally Wednesday. Report IDs adware originators: Marketers appeared to be directly responsible for more than half of the pop-up and other online advertisements run through so-called adware networks, reducing the companies' ability to plausibly deny knowledge of that connection, a report has found. Critics say adware has become one of the top scourges of Internet use because it can degrade computer performance, track a user's browsing habits and mysteriously appear on computers without a user's full knowledge. Major companies often blame an intermediary when they are found to advertise through such programs. But the Center for Democracy and Technology, a nonprofit group that has conducted research on such programs, said Wednesday that 55 percent of the ads, particularly those coming from smaller companies, used no intermediaries at all. "There are a lot of companies that are clearly working directly with adware companies," said Ari Schwartz, deputy director for the center.

The report did not name the advertisers. Researchers studied the patterns by loading two computers with adware and installing a packet logger to track the Web addresses accessed. AT&T tweaks West Bank, Gaza phone billing: AT&T Inc. is putting its official stamp on the West Bank and Gaza by changing its phone bills, a move driven more by economics than politics. Long-distance charges for dialing the Palestinian-run lands will carry their own designation rather than appearing as calls to Israel.

The company also is raising the rates sharply for calling the West Bank and Gaza, citing the rising fees AT&T needs to pay other carriers in that region to connect calls. The rates for AT&T's assorted long-distance plans will increase by roughly 20 cents per minute to about 32 cents starting in September. That's more than double the current rate of about 12 cents a minute for calls that will now be designated as "Palestinian Authority" on AT&T bills. Users of AT&T CallVantage, an Internet-based service, will pay 31 cents a minute, up from 6 cents a minute for calls to landline numbers and 14 cents for dialing mobile phones in the West Bank or Gaza. Look if you want to, but just don't undermine: Looking at Internet filtering practices in Vietnam, one could conclude that the government is more worried about politics than porn. University researchers said in a report Wednesday that the practices run counter to the government's own statements.

"Vietnam purports to prevent access to Internet sites primarily to safeguard against obscene or sexually explicit content," the report said. "However, the state's actual motives are far more pragmatic." Vietnam's Internet service providers did not block any of the pornography sites tested but filtered most of the sites "with politically or religiously sensitive material that could undermine Vietnam's one-party system." China and other regimes worried about political sites also turn their attention to blocking porn, said Derek Bambauer, a research fellow with OpenNet Initiative, a collaboration of Harvard University, the University of Toronto and the University of Cambridge.

Burning issue: Transfer to DVDs - Movie licenser changes its tune

08.12.06

Associated Press
A film industry group is ready to remove several of the procedural hurdles that prevented the legal recording of movies to blank DVDs in a further sign that Hollywood studios are preparing to expand what consumers can do with downloadable movies. Under rule changes expected to be finalized soon by DVD Copy Control Association, retailers could create movie jukebox kiosks with which customers can select, say, an obscure title and burn it to a DVD on the spot. Online merchants, like Apple Computer Inc.'s iTunes Music Store, could start to allow video downloads to be transferred to DVDs.

The changes involve the copy group's proprietary technology known as the Content Scramble System, or CSS. The association, an arm of Hollywood studios, licenses the encryption technology to makers of DVD players and other electronics companies and applies it widely to movies on DVDs to restrict illegal copying. The association said it soon will expand licensing to movies that are digitally distributed on demand or a la carte - and not just for movies that are mass-produced on DVDs. The group also is working with makers of discs to produce CSS-compatible blank DVDs. Hollywood studios have been experimenting more with digital distribution. Until recently, they have been reluctant to allow consumers to transfer online purchases onto DVDs, limiting playback largely to computers or entertainment systems that are linked to a network. Last month, online movie service CinemaNow became the first to allow customers to transfer mainstream films onto DVDs using an alternative encryption method, but users complain the movies sometimes can't be played on standard DVD players. That problem should disappear when CSS is available for digital downloads, said Jim Taylor, a general manager at digital video software company Sonic Solutions.

"It'll open the floodgates for a lot more premium content to be burned onto DVD," Taylor said of the changes. Sonic already has teamed with online movie provider Movielink to provide burn-to-DVD offerings that will be CSS-compatible.

Hollywood Might Ease DVD Burning Bans

08.11.06

By Frederick Lane
Greg Larsen, the spokesperson for the DVD CCA pointed out that "consumers can get the shows they want in small quantities. A customer could use a kiosk, for instance, to get a copy of a rare movie, one that was not widely distributed. The upshot is increased availability of content for consumers." The DVD Copy Control Association (DVD CCA), an industry association for Hollywood film studios and other content providers, is poised to adopt rule changes that will expand consumer choices for purchasing and downloading movies. Once the changes are finalized, customers will be able to download video content from online sources like the iTunes Music Store and save the content on blank DVDs. Brick-and-mortar retailers could create electronic kiosks of movies and allow customers to purchase copies by burning the movie to a blank DVD in the kiosk. The content made available to consumers will be protected by the DVD CCA's proprietary protection technology, the "Content Scramble System (CSS)." In order to make a copy of protected content, consumers would have to use a blank CSS-compatible disc. Greg Larsen, the spokesperson for the DVD CCA, said that there was no specific timeframe for the roll-out of the new duplication capabilities.

"Given that it's being driven by market demand," Larsen said, "I expect that it will happen fairly quickly."

According to a DVD CCA press release, all that remains is for the association's members and the board of directors to approve the proposed changes.
Epic Battles Against Movie Pirating
According to Larsen, one-third of the members of the DVD CCA board come from the information technology industry, one-third from the consumer electronics industry, and one-third from the content producers and the Hollywood motion picture studios. All three industries spend millions each year to fight movie pirating around the world, and have been at the forefront of efforts to develop effective digital rights management (DRM) technologies. The chief consequence of a strict DRM policy is that it limits what consumers can do with the content they purchase. Consumers who download a movie today, for instance, are largely limited to viewing the movie on their computer. "The goal," Larsen said, "is to make it convenient to download onto a CSS disk so that it can be viewed in any DVD player."
Expanded Consumer Choice
One of the chief benefits of the DVD CCA's policy change is that it will not only expand consumer choice for playback, but also the amount of material available. "Rather than waiting for a studio to do a mass pressing of a particular title," Larson pointed out, "consumers can get the shows they want in small quantities. A customer could use a kiosk, for instance, to get a copy of a rare movie, one that was not widely distributed. The upshot is increased availability of content for consumers." Even a cursory review of entertainment blogs and Amazon reviews makes it clear that there are large numbers of people eagerly awaiting the release of their favorite canceled TV show or obscure movie. Over the months and years to come, the DVD CCA and its members will be hoping to tap into that market.

Legal DVD Burning for Digital Films Closer to Reality

08.11.06

By Jay Lyman of TechNewsWorld
The DVD Copy Control Association said this week that it will change its Content Scramble System, otherwise known as CSS, to allow burning of digital movie versions to special blank discs. The technology is expected to first become available at in-store kiosks. In yet another sign that the Hollywood studios are getting more comfortable with the idea of digital distribution for films, the DVD Copy Control Association (CCA) announced changes to the industry's encryption system which will allow some legitimate movie DVD burning. DVD burning capabilities are already offered legally from some services, but the titles available are extremely limited. The DVD CCA's new version of its Content Scramble System (CSS) would allow burning of movies to special blank discs, at first via in-store kiosks through a variety of retailers. The system will allow users to search, locate, download and rip DVD video from a substantial selection of newer movies and more obscure content, including historical and other video unavailable on retail DVDs.
Logical, Legal Step
The changes to CSS, which was cracked soon after it was introduced in the infamous "DVD Jon" case, are the latest step toward widespread digital distribution of films and other video content. Other steps came earlier this summer, when online movie services Movielink and CinemaNow announced DVD burning capabilities for a limited number of films thanks to content controls and support from movie studios. The DVD CCA said its new technology, which requires special blank DVD discs and hardware, would at first be available in commercial kiosks that allow users to burn customized discs. The group said consumer applications of the new recording function are also expected. These will include technologies to offer DVD burning on PCs, or recording among networked DVD recorders. "The creation of new ways to legally create secure DVD content is the logical next step to answer industry and consumer demand for additional legal digital distribution alternatives," Cookson said.
In Stores Now
The changes to CSS are an important development, but are not that significant considering the technology's limitations, in particular the present lack of special DVD discs and hardware it requires, Gartner (NYSE: IT) Research Vice President Van Baker told TechNewsWorld. "That's another thing that's going to be a huge limiting factor," Baker said, also referring to the reluctance of some customers to download and burn DVDs that may be readily available at retail stores. However, Baker said the CSS changes reflect the movie industry's recognition that media and distribution are changing and fragmenting as technology advances. "They're finally at the point where they are accepting of that and willing to experiment," he said.
Burning Stations
While it will take some time for movie downloading and burning to make its way into the mainstream and into the average household, the kiosk concept may have significant appeal for consumers. The services will allow them to more easily find what they are looking for via electronic search, and store owners may see an upsurge in customer visits as more people come in to use the service, according to Baker. "There could be activity in that space immediately," he said. The CSS changes may help online movie companies, including NetFlix, meet high demand for hot new releases. "It could help their business model," Baker said.

Hollywood ready for DVD burning - The beginning of a beautiful friendship?

08.11.06

By Greg Sandoval of CNET News
Often accused of being anti-consumer when it comes to digital media, the movie industry now has plans to relax controls over how films are copied to DVDs. In the past, watching a movie downloaded off the web meant viewing it on a PC. Soon, people will be able to copy a digital movie onto a specially made DVD under rule changes expected to be adopted by the DVD Copy Control Association (DVD CCA), the group that produces the technology designed to prevent DVDs from being copied. Digital movies, which are offered by such companies as CinemaNow and Movielink, have so far failed to catch on with the public. One of the big complaints from consumers has been that downloaded movies are prevented from being copied to disc and, thus, can't be watched on TV sets. The reason for this is that Hollywood studios feared downloads would be easily pirated. Despite the precautions, unauthorised films continue to be distributed on the web. The latest move by the DVD CCA fits with Hollywood's overall strategy to combat piracy by offering consumers a legal, inexpensive and convenient way to obtain digital movies so they won't bother to steal them. A spokesman for the association said: "We want to give people the entertainment they want and offer it to them in the ways they want to use it."

Retailers in the video-on-demand business say this is only the first of many upgrades to the video-on-demand business. Tom McInerney, founder and CEO of Guba, a video-sharing site that recently negotiated deals with Sony Pictures and Warner Bros Entertainment to sell downloadable movies, implores critics of the video-on-demand market to be patient. McInerney said: "This is only the first minute of the first quarter in this industry. Now you can burn movies to DVDs, and soon broadband improvements are going to allow a speedier delivery of films over the net. It's all coming together." To allow copies to be made, the DVD CCA will have to make "adaptations" to the group's encryption technology, which is called the Content Scramble System, or CSS, said the spokesman. The association, made up of Hollywood studios, consumer electronics and software companies, licenses CSS to those in the DVD industry to protect content. In a statement, the association said an updated version of CSS could allow retailers to place kiosks on showroom floors and allow consumers to watch as a digital movie recording is placed on a blank DVD while they wait. The DVD CCA didn't say whether any merchants were considering such a plan but McInerney said he predicted retailers might find such kiosks appealing because they would no longer need to stock shelves with pre-packaged copies of movies. McInerney said: "A retailer could increase the size of their movie libraries without taking up additional floor space."

Film-to-DVD Burning to be Simplified

08.11.06

The DVD Copy Control Association, a movie industry party, plans to soon cut back some of the copy restrictions that have hindered the legitimate "burning" of digital films to blank DVDs—a move that represents big Hollywood studios’ increasing willingness to sell downloadable films that can be legally transferred to discs, the Associated Press reports via the Seattle Post-Intelligencer. The modifications to the current rules are expected to be made official in the near future, and they would enable movie sellers to employ "jukebox kiosks" that could be used to select films and burn them directly to DVDs at stores, according to the AP. The DVD Copy Control Association’s Content Scramble System (CSS) is currently used by producers of DVD players, DVDs and other electronic devices to encrypt content and help prevent piracy, the AP reports. Technical and policy modifications in relation to the CSS are expected, and the association said it will soon begin to license the technology to firms that sell films for download instead of just traditional DVD retailers, the AP reports. The association also hopes to work in conjunction with blank DVD makers to offer discs that are compatible with the CSS, according to the AP.

In the past, major Hollywood studios have been hesitant to offer films for download due to concerns over piracy and the cannibalization of traditional DVD sales. The DVD Copy Control Association’s decision to cut back some copy restrictions and work with film download sellers represents the industry’s latest move toward acceptance of the online sales medium.  In July, CinemaNow became the first retailer to offer legal film downloads that can be burned to DVD, and such heavies as Walt Disney’s Buena Vista Home Entertainment and Sony Pictures Home Entertainment have already inked deals with the firm to provide content. Another video-download firm called Movielink also recently announced plans to offer burnable films for download, though it did not set a time frame for when the service would be operational. Check out our CIO News Alerts and Tech Informer pages for more updated news coverage.

DVD Burning, Retailers and Comsumers

08.11.06

by Technology News
Commercial vendors and individual consumers can now look forward to being able to legally create certain types of protected DVDs, the DVD Copy Control Association (DVD CCA) announced. Under rule changes now in the works, commercial vendors could create protected DVDs on kiosks and in small custom runs. Individual consumers could legally record a variety of selected content. Both would require special blank DVD discs that will use the Content Scramble System (CSS) for encryption and will be compatible with the millions of existing DVD players in the marketplace today. An early application of this type of recording would likely be commercial kiosks, where consumers could buy entertainment, custom-burned on the special discs. This would allow consumers to obtain, for example, unusual, historical or special content that is now unavailable on DVD because existing demand does not warrant the mass reproduction today’s market requires. The consumer application of the new recording function is expected to follow, offering in-home recording of a broad range of specifically offered content which could include movies, television programs and more. The programs would be recorded on personal computers via the Internet or on special, network-enabled, DVD recorders. This important development required an amendment to the Procedural Specifications for CSS. Already approved by DVD CCA’s Content Protection Advisory Council (CPAC), the new functions would be available for implementation – assuming compliance with all applicable specifications (e.g. DVD Forum) – after membership review, and action and approval by the Board of Directors.

DVD burning of download movies could become legal

08.11.06

By Nigel Wright
The DVD Copy Control Association is now relaxing some of the restrictions it had enforced, which basically prevented any recording of downloadable movies onto DVDs. The association said special blank DVDs would now allow this process. These discs would include the technology called the content scramble system (CSS), which is designed to prevent illegal copying. The proposed change in rules would make this technology more widely available to allow for movie download providers such as Movielink to enable burning capabilities. The association's chairman Chris Cookson said the creation of new ways to legally create secure DVD content is the logical next step to answer industry and consumer demand for additional legal digital distribution alternatives.” Allowing the creation of high performance, protected DVDs in the business or at home that, until now, could only be mass-produced in factories is another major step forward." The step will help service providers like Movielink and iTunes to take up burning of video content on DVDs. The association said the programs would be recorded on the hard discs of personal computers when they are downloaded via the internet or on special, network-enabled, DVD recorders. The association has already approved the change in rules and it will be available on a mass scale once the process become compliant with other specifications. Meanwhile, Hollywood studios appear to be approving the association's proposal.

According to one proposal, movie retailers and rental shops would be allowed to install kiosks where customers could order a movie and burn it to disc in the store. Two online movie stores, Movielink and CinemaNow, have download-to-DVD services now, but they use encryption technologies that are not always compatible with standard DVD players.

DVD Copy Control Association loosens restrictions... slightly

08.10.06

by Jeremy Reimer
When DVDs were first released, they contained an encryption-based copy protection known as CSS. While CSS was relatively simple to crack, this raised all sorts of legal issues about consumer rights and the ability to make backups. It even landed Jon Johansen, the author of DeCSS, in legal trouble, although he was later cleared on appeal in a Norwegian court. Clearly, DVD copying was serious business, and the movie industry was going to fight tooth-and-nail over the issue. Now, it appears that the DVD Copy Control Association, the group in charge of CSS and other forms of copy protection, has decided to loosen the reins (PDF) ever so slightly. No, CSS is not going away, but new rules are being finalized that could make it legal for store "movie jukebox" kiosks to offer burned movies to consumers. The kiosk idea has been around for a while, but the proposed new rules would make the burned DVDs fully CSS compliant and capable of being played back on any DVD player. It also opens up the possibility for online movie stores, such as the iTunes Video Store, to allow customers to burn downloaded movies to DVDs. Currently, there are some services that offer this feature, such as the CinemaNow Store, but their system only works with a fraction of titles in their movie library, and the attempt at adding their own copy protection resulted in burned movies that had serious defects and could not be played in all DVD players. Having a fully licensed CSS burning system could, theoretically, fix these problems. The digital delivery company Sonic Solutions has already teamed up with MovieLink to provide CSS-compatible downloadable movies that can be burned to DVD. Will the changes be enough to reverse the trend of declining DVD sales? Probably not, as the DVD market saturated itself some time ago and most people simply don't purchase as many titles as they did when the format was still gaining in popularity. However, the movie industry may be taking a page from their musical cousins, who have seen digital sales grow spectacularly in recent years, while CD sales remain flat. Most of this growth comes from the iTunes Music Store, which offered consumers the ability to burn music tracks to an unlimited number of CDs. Ironically, this was all possible because of the lack of copy protection on CDs in the first place. Given the much more stringent copy protection schemes being delivered with the new Blu-ray and HD DVD players and movies, it appears the movie industry still has some learning to do.

If It's Tangible, They Will Buy...

07.19.06

by Lydia Loizides
IN OUR RUSH TO MONETIZE the digital world, content owners often overlook the basic needs of the consumer. And in many cases, legal eagles, marketing whizzes, and sales sharks think in absolutes--you may do X, but you cannot do Y. If you do Y, then you may do Z--but only if there is a full moon and you surrender your Social Security number and first-born. But I digress. In the digital content world, Apple was really one of the first content services providers, through iTunes, to add the word "and" to the options list of things that consumers could do, legally, with their content: they could download AND burn to CD AND stream from the PC AND etc. The reason I bring this up is because Movielink just announced a partnership with a company, Sonic Solutions, that will enable consumers to burn the movies to DVD. This is arguably an AND in the content world (and a refreshing one at that). You see, in today's day and age, we are mired in what we can't do versus what a consumer wants to do. Consumers want the feeling of ownership; of being able to hold something in their hands. Even with an iPod, you are still holding what you believe to be all your songs and all your videos in the palm of your hand. The hardware (the iPod) makes the software (the content) real. This got me thinking about an often-overlooked technology that really hasn't solidified its place as a viable content distribution channel--yet. I submit for your consideration: the IP-enabled kiosk. Now, I know that many of the music-related initiatives that were centered on the kiosk as a primary distribution hub have not succeeded (I have my theories as to why, which I will save for another time). But there are several companies, one of which is CustomFlix (which is owned by Amazon.com), that operate in the video market and are showing promise. And while there are problems, I will argue that they are not insurmountable. Besides, there has been quite a bit of buzz of late with CustomFlix recently announcing a partnership with CBS News that aims to phase most of its video library online so that consumers will be able to create custom DVDs from the network's archives of news video. Wal-Mart has also been rumored to be testing kiosks for video distribution--as have Target and even Best Buy. Now, first things first: The studios have said they like this idea of DVD-burning kiosks but have not endorsed them as a preferred distribution hub. And big-box retailers need to temper this strategy with the foot-traffic and in-basket revenue that DVDs help to generate. So, in an effort to begin a dialogue, let's start with a short list of the potential upsides and downsides of implementing this kind of strategy by our two constituents: the studios and big-box retailers.
Studios:
1. Create new windows. Upside--this would create a new window and new revenue channel. This could also be used to bolster the 45-day DVD window as well as help drive event-driven product (i.e. new TV season, sequel theatrical titles, etc.) 2. Create new distribution points. Upside--this would create a new point of distribution in a direct-to-consumer model that leverages IP or digital transition of library content. 3. Opens the library at lower costs. Upside--over time, scale would make IP-based distribution a more efficient platform for accessing and delivering content from the library versus tangible media. 4. Possibility of piracy. Downside--it is possible that consumers could break security measures on the DVD, replicate and illegally distribute the content. Then again, they have been doing that ever since I can remember. Just visit a street corner anywhere on Manhattan's Sixth Avenue or Canal Street to see what I mean.
Big-box Retailer
1. Increase available inventory of titles at lower costs. Upside--with shelf space getting tighter and title availability increasing (TV titles continue to hit the DVD market as well as other, untapped titles from the studios hit the proverbial shelves), it is cheaper to adopt a store-and-burn strategy long term than to cannibalize square footage revenue for a zero-to-low-end margin product that is primarily used to drive foot-traffic. 2. Increase in-store time spent. Upside--would increase in-store time spent, as consumers would be engaged with the content. Last year, Wal-Mart had Nielsen conduct a study of the efficacy of their in-house television network. It was reported that customers spent 7 minutes on average watching in-store content programming (this is primarily advertising content). With something as engaging as movie-related content on a strategically placed kiosk, it's feasible that total in-store viewing would continue to grow 3. Increase basket-revenue per customer. Upside--larger title availability would, arguably, drive higher unit sales and contribute to an overall increase in basket revenue after the initial capital expense of the system was amortized. Also, it is conceivable that the product would carry higher profit margins for retailers simply because the cost of distribution is drastically reduced, since you no longer have to deliver the product on trucks and in jewel cases. 4. New revenue opportunity. Upside--in much the same way that an in-house television network provides an opportunity for advertisers (think Wal-Mart and its 2,600+ stores), a kiosk is also a point of advertising. And in this case, it is highly desirable content and contextually relevant. Reports cite that advertisers were paying between $137, 000 and $292, 000 (in 2005) for one commercial to run for four weeks on the Wal-Mart in-house television network (depending on reach, frequency and length of the advertisement). With the ability to generate 130 million views every four weeks from the in-house television network, what studio wouldn't want to buy a piece of that traffic to run exclusive previews, behind-the-scenes and other targeted content that paired a video- centric kiosk with television screen? For that kind of exposure, the cost is a rounding error in today's marketing budget for an "average" theatrical release. 5. System reliability. Downside--as with any technology, a high failure rate of the system would negatively impact the consumer experience. There is also a risk that consumers would not use the system because of a perceived higher barrier to entry (maybe they would not feel comfortable operating the unit), or they wouldn't be able to assess the benefits of access to a deeper library of content. Big-box retailers would also have to consider on-site maintenance resources in order to ensure a low-failure rate and timely service. Now, I am not saying this is the be-all, end-all. And this analysis is, well, really a back-of-the-envelope hypothesis that needs to be fleshed out. But imagine the possibilities, people! There is nothing more real that something that you can hold in your hand, something that you can consider your own. If I am totally wrong, then why did VHS eclipse the pay-per-view market? Or a la carte VoD versus the DVD market? How valuable is the ability to hold and believe that you own your own media? I would argue that you can't even begin to quantify that kind of value to a consumer. Then again, I could be wrong. You tell me.

Service to use Sonic Solutions' DVD-on-Demand technology

07.16.06

By Paul Sweeting
The movement toward allowing consumers to burn their own DVD copies of downloaded movies is poised to take a major leap forward. On Monday, software maker Sonic Solutions and download service Movielink are set to unveil a cross licensing agreement for technology that will enable consumers to download movies and burn them onto discs that will play in most set-top DVD players. Although the announcement of the deal will not include firm commitments from program suppliers to make their titles available for home burning, Movielink is owned by five major studios, and it’s unlikely they would permit the deal with Sonic to go ahead unless plans for a download-and-burn option were well advanced. “We’re anticipating an industry resolution to establish rules for converting secure Internet-delivered Movielink downloads into a secure format compatible with DVD players in the market today,” Movielink CEO Jim Ramo said in a statement. “Our relationship with Sonic is a critical advancement and will enhance the value of our service, along with the capabilities already available, by allowing customers to burn and playback movies on standard DVD players.” Movielink already offers a download-to-own service, but it has not proved popular without the ability to burn the movies onto discs for playback on set-top DVD players.

Under the new agreement, Movielink has licensed Sonic’s DVD-on-Demand technology, which converts downloaded movies into a format that can be read by standard DVD players and burns the converted file to a disc, along with digital rights management software to protect against piracy. Most DVD players can only read discs encoded in MPEG-2, while download services such as Movielink typically use more efficient codecs, such as Microsoft’s Windows Media Video, to reduce download times. For its part, Sonic will bundle Movielink’s download manager software and interface with its Roxio-brand CinePlayer software package. CinePlayer is sold at retail but also is licensed to PC makers and bundled into millions of new PCs and laptops each year.

“This is really a tremendous opportunity for Movielink to put its client application into millions of consumers’ hands as part of a trusted brand they already know,” Sonic’s executive VP of strategy Mark Ely said. Although the Movielink/Sonic deal puts critical pieces of a download-to-burn model in place, several important details remain to be worked out before major studio product is likely to become available for burning. For home-burned discs to be compatible with all set-top DVD players, for instance, the industry would have to adopt the same CSS copy-protection system used on commercially manufactured discs. Inter-industry talks aimed at extending CSS to downloaded movies, however, have dragged on for months, as the studios have pressed hardware and PC makers into incorporating a variety of additional security measures into new DVD players as the price of a deal on burning using CSS. Recently, however, the studios have softened their stance, according to sources familiar with the discussions, raising hopes that a deal could be reached before the end of this year. The chairmanship of those inter-industry talks recently passed to Sonic senior VP and general manager of its advanced technology group, Jim Taylor.

Even if a deal cannot be reached soon on CSS, the studios are preparing other copy-protection schemes that would be compatible with most set-top players, according to Ely. “The studios have spent a fair amount of time evaluating a lot of alternatives to CSS,” Ely said. “I think it’s fair to say what we’ll see is a variety of different solutions being tested. You could have CSS in conjunction with some kind of anti-ripping software, or CSS alone, or an anti-ripping system alone.” The Sonic software is designed to work with whatever DRM system content owners choose to use for home-burned discs. “If the CSS amendment is passed, I’m sure that’s what the studios want to do, and we’re ready to do that,” Ely said. “But if it’s not, we can deal with other solutions. We just want to help the studios come up with a solution they’re comfortable with.” Another major issue to be resolved is the reaction from retailers likely to be upset at facing direct-to-consumer competition.

Although studios are known to have had conversations with major DVD retailers, including Wal-Mart, about an in-store burning of discs, no firm plans have been announced. That too could be changing soon, however, according to Sonic officials. “We’ve been working for several years with a lot of people to establish the infrastructure for a DVD-on-demand business,” Sonic’s communications director Chris Taylor said. “We’re putting the pieces in place for home users as well as for retail kiosks and enterprise solutions. This is an important milestone for us, but there will be others as well.”

Kiosk maker to bow machines at grocer Sprouts

07.11.06

By Jennifer Netherby
In one of the first deals for in-store DVD burning, kiosk maker Polar Frog Digital will bow a mainstream movie download kiosk at natural grocer Sprouts, Polar Frog CEO Todd Rosenbaum said. Polar Frog has deals with independent suppliers Hart Sharp, Razor Digital and Ariztical to offer a selection of content for in-store burning through the kiosks, which the company is showing off during the VSDA convention. The company is in talks with the major studios and other retailers to add additional content and store locations. Polar Frog’s kiosks hold between 700 to 800 films or 3,000 TV episodes (roughly 3 terabytes). Through a high-speed Internet connection, the kiosks can download 40 new movies each month. Consumers can only choose from those movies already downloaded to the kiosk. Once they make their choice, the kiosk takes six to eight minutes to burn a disc, which can then be played on any set-top DVD player. The kiosks also let consumers pre-order titles through the system. Polar Frog is an offshoot of rackjobber TopHits Music, which handles CD, DVD and book sales at Walgreens and other grocers and convenience stores.

The company’s kiosks have already been operating in adult stores since the start of the year, and now Polar Frog has its sights set on the mainstream movie business. So far they’ve struggled with a chicken and egg situation. “It takes content to get a retailer, it takes a retailer to get content,” Rosenbaum said. The company is selling its kiosks to retailers for roughly $10,000. The revenue for each movie or TV show sold will be divided with 33% going to content owners, 30% going to the retailer and the rest back to Polar Frog for operational costs (17%) and profit. Rosenbaum said in-store burning could open new opportunities for independent suppliers that can’t hold the shelf space of the majors and for retailers, such as drugstores, that haven’t been able to be profitable in selling new release movies because of the thin margins. “Our sex appeal is what we’ll do with independent content,” Rosenbaum said.

Movie downloads may be coming to a store near you

06.02.06

by Eric Bangeman
Hollywood's movie distribution system is in dire need of a fix—very few will dispute that. Movie attendance has been suffering, DVD sales are slumping, and all the industry has managed to do is come up with a half-baked, unpopular download service and a scant handful of simultaneous releases. In another attempt to sort of give consumers what they want, the motion picture industry is thinking about allowing retailers to set up in-store kiosks for distribution. Shoppers would be able to purchase movies via the kiosks and have them burned to DVD while they waited and/or downloaded directly to a mobile device. Retailers see them as a way to keep customers from fleeing to the Internet to buy movies while the movie studios hope that being able to burn a DVD or dump a title onto a mobile device will prove attractive to consumers. The kiosks would have a high-speed Internet connection so that a movie could be quickly downloaded once requested by a customer. The technology to make it happen is in place, but as is typical when it comes to distribution of movies or TV shows, making all the rights-holders happy is the big barrier. Currently, there are CD-burning kiosks in some stores that work much the same way. Consumers choose the music that they want, the disc is burned, and the customer goes on her merry way. It gives the consumer a modicum more choice than what she might otherwise have at the local record store (or big-box retailer for that matter), but lacks the convenience of browsing the iTunes Music Store or eMusic from the comfort of one's home. That's the biggest problem with the kiosks. While it has the potential to offer a way for consumers to quickly get the titles they want, it's not terribly convenient. Customers will still have to make it to the store, punch in their selection, and wait for the title to be downloaded (if it's not stored locally) and burned. There's no immediate gratification, which is all-too-important for the American consumer. Flexibility in content delivery is generally a good thing, but if it's not flexible enough to meet consumers' needs for immediate, on-demand delivery at a reasonable price, it's not going to prove very popular. As long as the studios have their DRM blinders on, we're going to keep getting pitched with uninspired schemes such as this.