The new technology allowing consumers who buy entertainment in physical formats to consume it online for no additional cost has gone live and is going global, with launches in the UK this Christmas, Canada in 2012 and elsewhere in 2013.
Sony (NYSE: SNE), Universal and Warner began shipping UV-enabled Blu-ray and DVD titles to U.S. shelves in October. In the last few days, the first three online exponents – SonyPictures.com, UniversalHiDef.com and Flixster.com – went live, allowing owners of the new discs to also stream the same movie on those sites for free.
UV-enabled discs will start shipping in the UK on December 26 with Warner Bros.’ Final Destination 5, followed by all its theatrical releases including Happy Feet Two, Sherlock Holmes: A Game of Shadows and The Dark Knight Rises.
In the UK, the Blinkbox movie VOD service and its new owner Tesco are launching their own individual version of the same idea – but only customers who buy discs at Tesco supermarkets gain corresponding free access through Blinkbox. But Blinkbox will also be plugging in to UltraViolet in 2012.
“Tesco and Blinkbox have been signed to UV since 2008 and are excited about the opportunity it offers,” Blinkbox tells paidContent. “We are very supportive of UV and think it offers a great opportunity for the industry to provide customers with amazing flexibility in how they watch the videos they purchase.”
Against a backdrop of piracy and the rise of subscription access services like Netflix (NSDQ: NFLX) and Spotify, UltraViolet is a defensive ploy to build online value around the same model entertainment has known for decades – ownership.
“The idea of electronic sell-through is not growing as much as hoped,” Digital Entertainment Content Ecosystem general manager Mark Teitell told me.
“Consumers don’t have all the freedom of flexibility and usage. People don’t feel that, if they buy something they’re going to own it for the long term. So they might just decide to rent it.”
Subscription services, which grant unlimited access, are gaining traction but, unlike the individual ownership model, operate a self-reinforcing lock-in – that is, the more you build out your music library in Spotify, the less inclined you might be to discard it for a rival service in future.
“The idea of a proprietary silo for subscriptions makes sense,” Teitell conceded. “But it’s been loud and clear from consumer research that, for consumers who like to buy things, that idea is of a walled garden.
“They’re worried about getting locked in to one service provider for life. If consumers invest in owning things in a collection, they need assurance that they won’t ever have to walk away from that collection.”
Each UV-enabled disc comes with a code that, when entered in to UltraViolet’s website, joins a list of titles to which an owner has access across compliant services.
Twenty-one early UK licensees to participate in the UK include CastLabs, Comcast/NBCUniversal (NSDQ: CMCSA), Cyberlink, Hastings Entertainment, Intel (NSDQ: INTC), MediaNavi, PacketVideo, Rovi, Samsung, Sony, Twentieth Century Fox and Warner Bros. (NYSE: TWX) (Update: DECE corrected its partner list).
DECE’s 75-strong consortium includes Lovefilm, Red Bee, FilmFlex and Sky, but it’s not known if their part extends beyond merely interested-party status at this stage.