Amazon.com Inc. (Nasdaq:AMZN) and Tivo Inc. (Nasdaq:TIVO) are joining forces to allow people to download tv shows and movies from the Internet to their digital video recorders.
The service will be available to the 1.5 million people with TIVO DVRs with broadband capabilities later this year. The Associated Press said the companies refused to give a target date for its launch, which immediately makes me wonder if they are having technology problems. Still, this may video downloads attractive to people who don't want to spend hours watching videos over their computer screen.
Amazon launched its Amazon Unbox download service last year Wal-Mart Stores Inc. (NYSE:WMT) just got in the game. Of course, there's still a whole host of other services such as NetFlix Inc. (Nasdaq:NFLX), Movielink and CinemaNow. Apple Inc. (Nasdaq:AAPL) also full-length movies at iTunes. Plus, there are loads of sites that offer the content illegally.
So far, companies are more eager to offer video downloads than the public is to buy them. That may change as people get used to the technology but the law of supply and demand still holds. I expect that these services will become cheaper and that small sites will get squeezed out of business.
This is great news for consumers but the impact on investors won't be known until the market develops, which won't be for a while.
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Reader Comments (Page 1 of 1)
2-07-2007 @ 11:41AM
Rick Hanley said...
Netflix is getting closer to death. Below are two items that are important but were left out of most reports on Amazon and Wal-Mart:
Amazon.com had a catalog of distribution rights, which Netflix couldn't deliver.
Wal-Mart will make about 60,000 DVD titles available through mail-order.
TiVo, Amazon offer video downloads that can be viewed on TV sets
From Associated Press
5:45 PM PST, February 6, 2007
…TiVo had previously announced a downloading partnership with Netflix, the mail-order movie rental service, but that deal eventually fell apart.
TiVo Chief Executive Tom Rogers said TiVo decided to go with Amazon.com in its new venture because the online retailer had a large customer network and a large catalog of distribution rights, which Netflix couldn't deliver.
http://www.latimes.com/business/la-020607amazontivo,0,6108661.story?coll=la-home-headlines
Red Herring
The Business of Technology
Wal-Mart Intros Movie Downloads
…Wal-Mart will use the foray into digital movies as a way to build a full-service online store aimed at home entertainment.
“We view this as the first step to move toward a multi-format and multi-channel strategy,” said Cameron Janes, director of digital media for Wal-Mart...
Willem de Zoete, head of HP’s digital entertainment services business, said the company is building a business based on custom DVD distribution.
About 60,000 DVD titles will also become available through a mail-order service in which consumers have an option to go online and order the discs. The service will launch mid-year.
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