Home Media Magazine » 18748 » Analyst Looking Consumer Adoption Cinemanow 18748
Font Size: A A A

Analyst: Looking for Consumer Adoption of CinemaNow

By : Erik Gruenwedel | Posted: 15 Mar 2010

Merriman Curhan Ford analyst Eric Wold, initiating first-time coverage of Sonic Solutions, March 15 said the Novato, Calif.-based company will primarily rely on PC-based technologies for revenue until greater consumer adoption of its Roxio CinemaNow movie-downloading software emerges.

Wold, who maintained a “neutral” stance on the stock, said Sonic’s base digital media management products will provide a solid cash flow base as CinemaNow adoption through partnerships formed with retailers and consumer electronics manufacturers matures.

“At this point, we prefer to wait for either a more attractive entry point and/or some additional signs that consumer adoption of its embedded product is accelerating with the additional consumer electronic devices reaching the market,” Wold wrote in a note.

Sonic said it sold more than 1 million units of Roxio CinemaNow software through 2009.

The analyst, who also covers Netflix and Redbox, said Sonic’s market share in PC-based shipments increased from 46% to 57% in 2009.

Wold said wider consumer adoption of CinemaNow will be predicated on association with premium third-party brands, including CE manufacturers’ Internet-enabled TVs, Blu-ray players, mobile devices, and retail/brand partners such as Blockbuster and Best Buy.

“Consumers are more likely to use a product from a trusted brand, which would drive adoption,” he wrote.

Indeed, Best Buy is expected to launch a digital media store in May utilizing CinemaNow.

In addition the analyst said ongoing tweaking of release windows by studios, including releasing movies on cable VOD ahead of DVD/Blu-ray, could significantly impact CinemaNow.

“We believe these shifts [should they become more widely utilized by studios] could cause consumers to more widely utilize VOD,” Wold wrote.


User comments


Sign up for Home Media's Daily newsletter to receive breaking entertainment news and other features.


Are Kiosk Rentals Hurting Sellthrough?

Submit Vote
- OR -
Click here to view results


Send us video clips of home entertainment industry events and parties