October 2, 2003 11:11 AM PDT
Movielink, Road Runner unite on Net movies
The deal will let Road Runner's roughly 3 million households with high-speed Net access rent films from MGM, Paramount, Sony Pictures, Warner Bros. Pictures and Universal Studios--Movielink's backers--as well as from Disney, Movielink said. The service will offer about 450 new release and classic films for downloading to PCs.
Financial terms of the agreement were not disclosed.
The deal underscores the momentum that's building behind online video services as broadband catches on with consumers and the technology to deliver audio and visuals improves. Nearly 20 million households access the Net through high-speed connections, and consumers are increasingly looking to their PC for entertainment. Internet operators want to fulfill demand, and entertainment companies want to offer legitimate services and avoid the online piracy that clobbered the music industry via peer-to-peer networks like Napster.
Earlier this week, Disney introduced a new video-on-demand service called MovieBeam that lets users download and store films via a set-top device. Movielink and rival CinemaNow also partnered with Microsoft's Windows Media Center to allow customers of the software platform to rent movies on the PC and view them on the TV.
The deal also highlights an unfolding business strategy for video-on-demand services such as Movielink, which are increasingly forming partnerships to grow their audiences. Earlier this year, Santa Monica, Calif.-based Movielink partnered with sites Hollywood.com and The Feed Room to offer co-branded film rental services similar to Road Runner's.
At the same time, video-on-demand services are gaining traction with movie studios, which have long been reluctant to license their film libraries for fear of digital theft. Earlier this month, Disney unit Buena Vista Pay Television signed a deal with CinemaNow, shortly after it had also licensed films to Movielink.
The new co-branded Road Runner service is similar to Movielink's own offer, with rental costs ranging from $2.95 to $4.99. Customers can download movies and watch them as often as they like within a 24-hour period. The downloaded movie expires after 30 days if not watched.
The companies are promoting the new service with a "Movie of the Month" program, which lets people vote for their favorite movie from a select group of titles each month. Road Runner will provide the winning movie free to all its customers the following month.
"Road Runner is at the forefront of broadband providers who understand that customers are not just interested in faster and always-on connections, but in the valuable content, applications and services that the Internet platform can best deliver," Movielink vice president Tyler Goldman said.