Wednesday, June 10, 2009

Movie studios create cable, online channel

Three Hollywood studios are starting a TV and Internet channel that will show films ahead of their DVD release date.

"Epix" will air high definition movies over cable and stream 720p videos online for free, with no advertisements, Ars Technica reports. The movies from Lionsgate, Paramount and MGM will run in the same window as pay-per-view and premium movie channels, before DVD release. That's not a huge development for TV, but such early releases for big movies has never been done online.

There is, of course, a catch: To watch online, viewers must subscribe to both cable and Internet for the service provider that carries the channel. In setting it up this way, the studios hope that cable companies will pick up Epix and tout it as a selling point to potential subscribers. They're also banking on setting up caching servers in ISPs' data centers, avoiding slowdowns when streaming across public internet.

It's too bad, then, that there won't be any way for people without cable to get the online version, but that's the point. You'd think Epix could make even more money by offering a paid online-only service, but that might anger cable companies because it would be another way for people to work around subscribing to television.

The question is whether cable providers will show interest in the first place, as Epix hasn't announced any partners. And even if Epix found willing cable participants, its not clear which tier will get the channel (I'm guessing it'll be bundled with premium packages that include other movie channels besides HBO).

I could also see a service like this getting rolled into other online packages as developed by cable companies, such as Comcast's OnDemand Online. Though I don't think any of these features will bring back customers who have already left, they're fine incentives to keep existing subscribers on board.

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