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As Computers Evolve, Makers and Retailers Wade Into DVD

23 May, 2002 By: Holly J. Wagner

The DVD bonanza has created an all-out feeding frenzy for computer makers and retailers who once focused their attention on the pocket protector crowd and hard-core gamers.

Computer superstores, once the last stronghold of geek purists, have seen the (laser) light and have begun catering even more to entertainment uses like movies and home networking.

CompUSA has long carried computer games, and recently began stocking DVD players and software to extend offerings that previously had focused on computer drives.

The company also recently raised the curtain on The Movie Store at compusa.com. The online storefront sells DVD discs and players, and even offers preorder on new players in the pipeline.

The chain, which runs 220 stores in 84 metro markets in the United States, cut an exclusive three-year deal with Navarre Corp. in April that brings in more DVD and CD software.

“CompUSA continues to transcend from being the destination of choice for computers to also being the source for America's home entertainment and technology needs,” division merchandise manager John Mynyk said at the time.

Well into this year, CompUSA's DVD offerings resembled a Top 40 list, with just a few titles available. The Navarre deal will make it more convenient for CompUSA customers to pick up a coveted title at the same time they expand their computers' media capacity.

Retailers are clearly counting on the cross-pollination of industries and technologies to entice techies to the simple pleasures of prerecorded video, but it also may expose the traditional video audience to a variety of new products they might not find at the discount stores that walk the DVD point.

CompUSA has carried personal video recorders (PVRs) for computers for some time, offering them as PC upgrades for the techno-chic. Typically they are external plug-in devices or simple PCI cards no more difficult to install than an internal modem.

While media hardware manufacturers and studios work together to create a hardware-based copy protection standard, computer makers have yet to establish even that uneasy truce.

Walt Disney Co. president and CEO Michael Eisner accused the computer makers of selling piracy as “the killer app,” using the suggestion of illegal downloading as a lure to increase sales.

Computer makers have countered with advertising disclaimers advising users they will fall afoul of the law if they reproduce copyrighted materials and to “copy responsibly.” Even the sales pitch on compusa.com for the WinTV onboard computer PVR carefully avoids any mention of copying for anything other than time-shifting.

But there is hope that tech companies and entertainment giants can make peace.

Computer maker Gateway is offering three Warner titles (from a list of 23) to buyers of its new DVD-enabled, Pentium 4-equipped computers through June 3. Buyers also may select from Warner/Curb Records music CDs.

“Gateway is helping people turn their PCs into a home entertainment center,” said Gateway's SVP of products and solutions Bart Brown. “By working directly with entertainment content providers, we can ensure our customers get more out of their PCs by owning great movies and albums by some great recording artists.”

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