If the Walt Disney Company were a person, would it be one of those insufferably cheerful types?
At a time when the dreaded dot-com suffix has become as welcome as, say, a world conference on racism, Disney has announced that it is teaming with News Corp. to bring us Movies.com, a video-on-demand business that the two hope will create a stampede for Net-based movie viewing at home. But if Disney is whistling while it works, reporters concluded, it's only because of the money it hopes to mine from cable TV.
Movies.com arrives three weeks after a consortium of five film studios announced plans to let consumers download films from the Web. Movies.com says it will offer the same Net service when it launches next year. Sure, sure, there's the argument that the studios are on a co-opt-Napster kick. But as the Los Angeles Times put it, "there's not likely to be much demand from consumers for downloadable movies." Movies on the Web? Please. Next thing you know, we'll be reading about how the Net will change everything.
The Disney/News Corp. deal is really about cable TV, according to reporters. What's different about it is that it would provide the only route to catch video-on-demand versions of Disney, Fox and Miramax films. That means that if you want to catch one of the studios' flicks after it leaves theaters but before it hits pay-per-view and the local video rental store, you better hope your cable operator has made nice with Movies.com. Forget about hitting the pause button while you're watching "Fantasia" for the 29th time, however: This gig doesn't cover animated films, and Disney isn't exactly best known for its live-action fare.
As the Los Angeles Times sees it, Disney and 20th Century Fox are hoarding distribution of their own films with an eye toward reaping the juicy licensing fees for video-on-demand services. The Times noted that the studios typically get a 50-50 split in their contracts with pay-per-view providers. But Sony and Universal recently reached VOD deals that give them a 60 percent cut. You can bet Sony and Universal execs were whistling over that deal.
Disney, Fox Join in Web Film Venture
Los Angeles Times
A 2nd Venture Set in On-Demand Film Rental
New York Times
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Disney, News Corp. Announce Deal To Offer Videos on Demand Online
The Wall Street Journal
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Disney, News Corp. Usher in Movies.com (Reuters)
CNET
Disney, News Corp. in Video Deal (AP)
MSNBC
Disney and News Corp. in Internet Film Plan
Financial Times
