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Disney to introduce feature for digital movie sales

By Brooks Barnes New York Times News Service
March 5, 2014 at 11 p.m.

LOS ANGELES - As consumers display increased interest in owning movies digitally - a habit considered crucial to Hollywood's future - Walt Disney Studios unveiled a service that is intended to make collecting its films easier.

Once fully deployed, the free service, called Disney Movies Anywhere, will allow consumers to buy a Disney, Marvel or Pixar movie once and watch it anywhere: on a TV, mobile device or computer. Users will be able to immediately link their Apple iTunes accounts with the Disney Movies Anywhere website and app.

Apple's involvement is an important component. A competing digital movie storage and management system called UltraViolet has partnerships with major digital movie retailers like Best Buy and Wal-Mart. But UltraViolet lacks a direct tie to iTunes, which controls roughly 60 percent of digital movie purchases.

Robert A. Iger, Disney's chief executive, notably sits on Apple's board.

In a statement, Alan Bergman, president of Walt Disney Studios, promoted Disney Movies Anywhere as an "exceptional consumer experience." Jamie Voris, the studio's chief technology officer, added that "the intuitive layout of the website and app creates an easy and enjoyable browsing environment."

The arrival of Disney Movies Anywhere has been long delayed. UltraViolet, which counts every major film studio except Disney as a member, was introduced two years ago. Disney opted not to participate in UltraViolet for a variety of reasons, including concern that the name was confusing and worries that families - Disney's core consumer - were not yet ready to embrace cloud storage technology.

There are signs they are ready now. Spending on digital purchases of movies and TV shows (as opposed to digital rentals) surged 47 percent last year, to $1.19 billion, according to the Digital Entertainment Group, an industry consortium. Digital copies of movies typically sell for $15.

Hollywood urgently wants consumers to form digital movie libraries, the modern-day equivalent of rec room shelves lined with DVDs. The reason: Selling a digital movie is three times more profitable for studios than renting one. Studios see ownership as a way to return their home entertainment divisions, battered by the decline of DVD sales, to growth.

To stoke sales, studios have started to routinely make new movies available for digital purchase two weeks before selling them on DVD and Blu-ray discs. The arrival of Disney Movies Anywhere may help strengthen the market even more.

"Once you start to get the family business going, you have mom involved," Mike Dunn, president of 20th Century Fox Home Entertainment, told Variety last month as part of report on UltraViolet. "That's historically been the critical gatekeeper and driver of major purchases for libraries."

The arrival of Disney Movies Anywhere coincides with the digital release of "Frozen," which has taken in more than $980 million at the global box office. For a limited time, Disney will give a digital copy of "The Incredibles" to people who activate Disney Movies Anywhere and link to their iTunes account.

To begin using the service, consumers download an app or visit the Disney Movies Anywhere website. Users can then import Disney, Pixar and Marvel films from their iTunes accounts; people who have purchased select Disney, Pixar and Marvel DVDs can type in a code provided on the packaging to claim digital rights to those films.

Disney did not say when the service would be compatible with Android-based mobile devices, although a spokesman said the company was in "active negotiations" with other technology partners. Lucasfilm, a Disney unit, is likely to join the Disney Movies Anywhere fold next year, with the release of a new "Star Wars" movie.



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