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DivX Gets Closer To the Mainstream

5 Mar, 2002 By: Holly J. Wagner

DivXNetworks is making a push for mainstream video-on-demand with its new version 5.0, which offers smaller file sizes and faster usability for video engineers and consumers.

Just back from a trip to Asia to pow-wow with hardware manufacturers, cofounder and CEO Jordan Greenhall said consumers could expect to see at least four new DivX-enabled devices on the market within the next 18 months at about the same price as MP3 players. Although he would not reveal which manufacturers will offer them, he said DivX compatible Sega Dreamcast units are already available.

The 5.0 edition bridges some gaps that other media players have not. This version will work on Windows, MacIntosh and Linux platforms as well as with wireless devices and game consoles.

"This takes it out of the PC world to bring it into multiple environments," Greenhall said.

But DivX will still have to overcome some mass market hurdles to cement a position.

The new version, available as a player only or a professional version for encoding content, is significantly faster than previous versions, but only for consumers with higher-powered computers (500 to 600 mHz) and high-speed cable or DSL connections.

"I wouldn't recommend downloading on a modem connection," said director of engineering Eric Grab. But, he said, the new version lets the consumer watch the movie during download on fatter pipes.

"If you have a good broadband connection you can click ‘download' and be watching it in 10 seconds," he said.

That could postpone widespread consumer adoption because only about 10 percent of U.S. households have broadband connections, according to emarketer's Ben Macklin, who said there were 6.2 million broadband households at the end of 2000 (5.8 percent of all households)

11.4 million at the end of 2001 (10.6 percent) and forecasts this to rise to 17.6 million in 2002, 25.6 million in 2003 and 34.7 million in 2004 (31.3 percent).

Also, many consumers have stopped upgrading their computer hardware frequently, said analyst Greg Durkin of Alexander & Associates.

"Instead of buying them every year they are buying one every two years," Durkin said. "The people who don't care about being on the cutting edge, they might upgrade every four years."

Many of the improvements are for the content providers. DivX put a lot of effort into improving the encoding speed so a content provider could encode three to four times faster than for Windows Media Player and create a file that is 41 percent smaller than what earlier versions of DivX produced, Greenhall said. The top speed requires a gigahertz-capacity computer, Grab noted.

DivX designers worked with major studios on their digital rights management design, Greenhall said, but so far only smaller suppliers are biting. In recent months DivX forged relationships with the Strand, Vanguard and Media (formerly Winstar) labels.

Wellsprng VP and general manager Dan Gurlitz is excited about his company's test of the supplier's new offering because staying on the cutting edge helps independents remain competitive, he said.

"We're watching technology move very quickly. I was here in 1997 when we decided to pull the trigger and put things on DVD," Gurlitz said. "Now we sit in the luxurious position of having a very deep list of DVDs. We broke the 60 percent mark with DVD a long time ago."

Wellspring is offering eight titles in its test. Users may download the free Divx player at divxnetworks.com and order Wellspring content at videocollection.com. The test content is available for $4.95 per program in a file that expires after five days. Just one feature film, Incubus, is on the list along with shorter Blues music and classic animation titles.

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