January 15, 2008

Tradeshow News - NRF has digital media kiosks and Macworld does movie rentals on iPod

Nice writeup by Patrick Avery of Kioskmarketplace on digital media kiosk news out of NRF show. These types of units attract a lot of attention but with exception of movie rentals in supermarkets it has never been able to gain any traction. Now it's the idea of movies and DVDs but wait...isn't Apple now offering movie rentals on iPod for $3 a pop ($4 for new releases). Maybe the Apple TV lives after all?

Digital media kiosks grow in numbers
by Patrick Avery * • 15 Jan 2008

NEW YORK — The popularity of Apple’s iTunes and Redbox’s DVD-rental kiosk was evident Monday at the National Retail Federation’s annual Show & Expo, though not in the form of those devices.

The popular online digital music store and DVD kiosk were not on display at the NRF show, but their influence was felt on several of the retail digital media offerings on the show floor. Digital media kiosks were introduced by self-service giants IBM and NCR as smaller companies like Mediaport introduced their own products.

The rise in digital media kiosk popularity is due largely to consumer demand and the fact that only a small portion of music is bought on the Internet, said Dave Champlin, vice president of marketing for Mediaport.

“We offer them a place to get quality content onto their cool devices (such as a cell phone or MP3 player),” Champlin said.

Mediaport's MediaATM system is a self-service kiosk that allows consumers to download digital content such as movies and music on-demand. The company recently inked its first video-download deal with a major studio, NBC Universal.

Last week, Mediaport installed several of its kiosks at the Consumer Electronics show and let convention-goers download free NBC Universal-owned episodes, spanning such shows as 30 Rock and Project Runway. At NRF, Mediaport let attendees create a custom mixed-CD from the kiosk’s music catalog, which included Led Zeppelin and Pink Floyd.

The launch of NCR’s Xpress Entertainment follows the company’s acquisition of Touch Automation, a privately held firm that provides the digital media merchandising kiosk.

The machine enables rentals, sales of shrink-wrapped media or a combination. In addition to transactions at the kiosk, future versions of the device will allow consumers to interact and download content via the Internet or their mobile devices.

“Self-service is best when all three self-service channels (automated kiosk, Internet and mobile device) are utilized,” said Mike Webster, vice president of NCR's self-service solutions. “This is only the first phase for this kiosk.”

Webster said the kiosk can be deployed in virtually any venue, including retail stores, convenience stores, supermarkets, quick-serve restaurants, shopping malls and airports.

IBM’s Digital Movie Kiosk, touted as the ATM for movies, is the culmination of a partnership with Ireland-based Portomedia. The kiosk allows consumers to rent or purchase DVD-quality movies, which are downloaded in under a minute to a small USB device called the Movie Key. The kiosk itself can be loaded with anywhere from 500 to 1,000 movies and can be refreshed with new content from a remote location.

“It’s essentially a Blockbuster in a box,” said Cathal Deavy, Portomedia’s director of marketing.

One of the reasons movie studios have allowed companies like Portomedia to sell its content is the kiosk’s use of DRM, or digital-rights management. For example, if a consumer rents a movie, that person may only have 48 hours to watch that movie before the movie’s license expires. That person would then have a chance to either rent the movie again or purchase it before they could watch it yet again.

Portomedia and IBM bypassed the Redbox-like DVD-rental kiosk for digital content because they see it as being more flexible, Deavy said. With a digital download kiosk, the content is always in stock and there are no returns.

Watch this Web site in the coming days for more news and insight from NRF 2008.

Apple Reinvents Film Biz With iTunes Movie Rentals
By Eliot Van Buskirk Email 01.15.08 | 3:30 PM
Apple CEO Steve Jobs announces the new iTunes movie rental service.

Apple is about to turn the movie rentals business on its ear.

The new iTunes movie rentals service, announced Tuesday by Apple CEO Steve Jobs during his Macworld Expo keynote, is powered by deals with all the major film studios and stands to reinvent the way people rent and watch movies, analysts say.

"They really nailed it," Jupiter Research Vice President and Research Director Michael Gartenberg said of Apple's move into movie rentals. "This is going to be extremely disruptive, doing for movies what the iTunes music store did for music."

The new service will let anyone with iTunes or an iPod rent DVD-quality movies with stereo sound for $3 ($4 for new releases). HD movies with 5.1-channel sound cost a dollar more. The "completely reinvented" Apple TV -- sporting an upgraded user interface at a lower price -- allows viewers to place orders from their couches. Unlike Amazon Unbox, which doesn't allow movies to play until they are totally downloaded (generally taking a matter of hours), Apple's new service allows movies to begin just seconds after an order is placed.

Gartenberg said he sees Apple's online movie distribution plan as a likely success due to the ease and flexibility of Apple's content/hardware ecosystem, as well as Jobs' ability to strike deals with the movie industry where other manufacturers have failed.

Jobs changed the music business forever when he unveiled the iTunes Store in 2003, and he hopes to do the same for movies. This is a massive market: The Digital Entertainment Group says rentals and sales of DVD discs in the United States totaled $23.4 billion in 2007. As movie rentals and sales migrate online, the stakes are high. Someone will win big, and that winner could be Apple, despite some stiff competition.

Apple says it plans to add more than 1,000 films by next month; the company will likely continue scrambling to increase its catalog. Apple's ability to add films quickly will be crucial to its success in this area, because when people decide they want to see something, they'll search for it where they know it is available -- not where it might possibly be in stock.

If you're a consumer, are you thinking about buying HD-DVD or Blu-ray, or are you thinking of going through iTunes, renting the stuff you want and linking with the rest of the iTunes ecosystem?" Gartenberg said. " Over the longer term, this is going to be very important."

With iTunes movie rentals, customers can view rented movies on their iPod, iPhone, computer or television, and the service can be used without a computer, since Apple TV can now download videos on its own. Once a title has been downloaded, the renter has up to 30 days to watch it. Movies expire 24 hours after being played for the first time.

In order for consumers to add another box to their entertainment systems -- even a box as nicely designed as the upgraded Apple TV – they need one that combines the convenience of on-demand cable with the breadth of Netflix. Jobs, who has run out of charm as far as certain record labels are concerned, will need to keep the movie studios on board long enough for the Apple TV to catch on. Certainly, 1,000 titles from all the major studios -- including 20th Century Fox, The Walt Disney Studios, Warner Bros., Paramount, Universal Studios Home Entertainment, Sony Pictures Entertainment, Metro-Goldwyn-Mayer, Lionsgate and New Line Cinema -- is a great start.

Even though the studios have granted Apple the wide, deep licensing it needs to succeed, Jobs won't be able to dominate online movies the way he has music. The iTunes music store launched into a vacuum; no other e-tailer had previously succeeded in signing deals with all the major labels. But these days, movies are distributed online not only by Amazon Unbox, Netflix and Movielink, but by massive cable companies and retail giants.

Posted by staff at January 15, 2008 03:55 PM