Feasibility Study of a Digital Platform for the delivery of UK ... - BFI

UK FILM COUNCIL
US-based CinemaNow was founded in 1999 with the backing of Lions Gate Entertainment, Microsoft and Blockbuster. In the US, the
CinemaNow library contains approximately 7,500 feature-length films, shorts, music concerts and television programs from more than
250 licensors, including 20th Century Fox, ABC News, Disney, Endemol, MGM, Miramax, NBC Universal, Sony, Sundance Channel, Warner
Bros. and Lions Gate. Approximately one third of CinemaNow titles are from the majors; the rest are from independents, including
specialised film content.
CinemaNow entered the European market in early 2001, initially offering streaming and later adding with PPV and SVoD downloading.
Since its launch, CinemaNow has been attempting to broaden its offering in terms of its business model, access and content. The most
significant development to date is Cinemanow’s introduction of digital sell-through on a download-to-own model (though no burning
rights) in January 2004. This model has yet to receive studio approval. Also, outside of the US, CinemaNow is precluded in its licensing
agreements to provide any premium content from the studios or any of their subsidiaries. Even in the US, it is believed that over 80 per
cent of CinemaNow transactions are derived from adult-orientated content.
Otherwise, the market has been slow to develop. CinemaNow offers three payment models: rental; monthly unlimited subscription; and
digital retail. The company lays claim to less than 50,000 subscribers. So far, according to the company, the subscription-based model
appears to be the most popular as users are reluctant to risk single payments for an unfamiliar title; the subscription model allows users
greater freedom to pick and choose from a diverse range.
There are significant restrictions on how the studios allow their content to be used. Although CinemaNow’s downloaded content can be
stored on any number of machines, restrictions are imposed by content providers rather than CinemaNow. In the case of the studios,
there are no burn rights and no portability permitted beyond the device the film was downloaded on. All billing is handled by CinemaNow,
and PayPal will be added to its range of accepted payment methods in 2006.
CinemaNow is currently available via the open Internet to PCs and Windows Home Media Centre-enabled TVs. Many titles have also been
encoded for Portable Media Centres, on which CinemaNow is working with Archos and other handhelds for download compatibility. The
platform expects delivery to Microsoft OS Smart Phones to be available soon. The platform has yet to offer support for other browsers
beyond Microsoft’s Internet Explorer as well as Sony’s PSP handheld and Apple’s video iPod. This is largely due to the company’s
extremely close affiliation with Microsoft.
In a wider context CinemaNow has been looking to broaden the accessibility of its service. The company already facilitates downloads to
compatible mobile devices – making around 550 feature length titles and 200 music videos available – and is now looking to accelerate
its progress to the living room, agreeing alliances with Microsoft’s MSN TV and Digital 5 in 1H 2005.
Feasibility Study for a Digital Platform for the delivery of Independent UK films and Specialised films to the Home
UK Film Council © 2006
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