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Movie Gallery Goes On-Demand With MovieBeam Purchase

7 Mar, 2007 By: Jessica Wolf

Movie Gallery has purchased digital rental service MovieBeam for under $10 million.

The No. 2 rental chain, which recently refinanced its debt to create some working capital, said it expects that the total incremental expense related to MovieBeam, including the initial acquisition cost and any ongoing development expenses, will be less than $10 million in 2007.

MovieBeam uses over-the air datacasting to transfer content to set-top boxes, which then allows users to purchase movies on demand for in-home viewing. There's no downloading time or hard disc storage necessary.

MovieBeam is available in 31 major cities across the country and has 100 movies for on-demand viewing at any given time.

“We believe the MovieBeam service provides the best video-on-demand service available in the marketplace today and is a strong, compelling complement to the consumer retail video store experience,” said Joe Malugen, chairman and CEO of Movie Gallery, Inc. “Our acquisition of MovieBeam is the first phase of our long-term strategic plan to provide digital content to consumers. We will begin merchandising the MovieBeam service in our Hollywood Video and Movie Gallery stores and on our Web sites in the near future and we have exciting plans to build upon the existing content digitization and broadcast platforms.”

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