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Studios Flock to AOL Download Service

24 Aug, 2006 By: Erik Gruenwedel

AOL Video announced it has rapidly expanded its burgeoning download service, adding movie and episodic TV deals with Sony Pictures Home Entertainment, 20th Century Fox Entertainment Group and Universal Studios Home Entertainment to that with Warner Bros. Home Entertainment Group, among others.

Movie downloads will range in price from $9.99 to $19.99 and can be viewed on PCs and compatible portable devices. They include such titles as Hitch, Spider-Man 2, Hostel, Black Hawk Down, The Benchwarmers, Donnie Brasco, Fun With Dick and Jane and recent releases Silent Hill and RV. TV episodes are $1.99 per download. Content cannot be burned to a DVD nor played on standard DVD player.

AOL launched a beta version of its video portal earlier this month underscored by more than 17 video content partnerships, 45 on-demand channels, a programming guide and search engine.

Separately, Warner Bros. Home Entertainment Group announced it would offer current and catalog fare to EchoStar Communication Corp.'s Dish Network satellite TV service, including video-on-demand, on demand, pay-per-view and high-definition.

Sony and Fox will collectively offer ad-supported TV content via seven branded on-demand channels at AOL Video. The channels will not offer movies.

Fox's channels will offer episodes of “24,” “Prison Break,” “Bones,” FX Network's “It's Always Sunny in Philadelphia,” Speed's “Pinks" and "Unique Whips” and Fuel TV's freestyle sports program “Firsthand.” Additional programming includes classic TV episodes of “Buffy the Vampire Slayer” and “Hill Street Blues,” among others.

“We are eager to continue to develop the market for digital downloads by applying our premium content to one of the Web's strongest brands,” said Peter Levinsohn, president of Fox Digital Media.

Ben Feingold, president of Sony Pictures Home Entertainment, digital distribution and acquisitions, said the Sony channels would be driven by its catalog and initially feature episodes of the original “Charlie's Angels,” “Starsky & Hutch” and “SWAT,” among other programs.

“AOL is a big portal and we thought it would be good to try the portal and on-demand channel strategy,” Feingold said.

Feingold doesn't see digital distribution competing with DVD.

“The DVD business is in year nine, so it is a fairly mature business,” said Feingold. “We are laying the seeds for broad digital content. What happens here has to be analyzed over the next five years. It is not just today's business.”

Sony offers content on Guba.com, CinemaNow and Movielink.

Feingold said Sony has experimented with the download-to-own concept at CinemaNow and Movielink, and would fully embrace the concept with adoption of certain amendments to the DVD charter.

He said Sony had no control over reported movie download price wars at some download services and emphasized that the priority was to build out the Web and product offerings.

“So long as we get paid what our promotional wholesale price is, people have the right to resale at the price they like,” he said. “I don't think people dropping the price to demonstrate some [price] elasticity to us is a meaningful thing.”

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