UPDATE: Movielink's New CEO Talks Business1 Feb, 2002 By: Holly J. Wagner
Viewers should get their first peek at studio-backed, Internet-delivered video-on-demand (VOD) by the end of the year, but a variety of technical issues remain to be worked out, said the new chief executive of the newly renamed five-studio venture Movielink.
"We want to do it this year, and to be honest I think it's going to be the second half of this year," said Movielink's new CEO, former cable and satellite executive Jim Ramo, after just three days on the job.
After months of speculation,the joint venture among MGM Studios, Paramount Pictures, Sony Pictures Entertainment, Universal Studios and Warner Bros. to provide VOD changed its name from the working title Moviefly to Movielink and named Ramo CEO last week.
"First and foremost it is the declaration that there is a management team that is charged with executing on the business model," he said. "Up to now there has been a board of directors and representatives from the studios. There wasn't a commitment to create the management team and launch. There are about 20 people here now who have been involved in the initial development and testing that have moved over [primarily from Sony] and from the management team."
Consumers won't need any special software to download films from Movielink, he said.
"They will simply go to a Web site, search and choose titles and be given suggestions. They'll click on the movie, click on ‘buy' and then download it," Ramo said. "The intent is to have a per-viewing capability and a price per view."
Studios will control the price charged for each title and where Movielink VOD movies fall in the release schedule, Ramo said. Movielink will get a cut of each per-view fee, for which viewers will pay online by credit card, he said. He anticipates Movielink VOD titles will fall into the present pay-per-view window.
Still to be worked out are the software encryptions and protections against copying.
"We definitely are going to have a fee-per-use basis," he said. "What will happen to the content on your hard drive, whether it self-destructs or sits there on your hard drive, will be in the software business rules."
With copyright issues at the forefront of digital movie delivery plans, Movielink will have protections, though Ramo could not yet say exactly how they would work.
"We are going to have a digital rights management software package that will allow us to put in business rules that will allow us to prevent [theft]."
So, will the VOD movies be
"I can't be completely absolute about that," he said, "but our intent is to have business rules that encryption software will facilitate. We don't initially intend to allow burning."
Although options for enforcing copyrights have not been finalized, Ramo agreed that software including a cookie that would alert Movielink or the studio to the number of times a viewer watched a film is "technologically feasible."
Movielink will be available only in the United States. There has been "no change" in the investigation the federal Department of Justice's Antitrust Division is conducting into studio-backed VOD services, and the investigation is not expected to influence Movielink's march forward, Ramo said.