Kindle Fire: Amazon Jumps into the Tablet Fray with iPad Competitor

  • Amazon has unveiled the Kindle Fire — a 7-inch touch-screen, color, and Wi-Fi tablet with dual-core processor that will sell for $199. The new tablet was announced by chief exec Jeff Bezos at a press event yesterday in New York City.
  • The Android-based device will offer access to Amazon’s app store, books, streaming movies and TV shows. Moreover, the expectation is that it will increase sales for Amazon’s other merchandise. Fire is available for pre-ordering and will be available November 15.
  • “The online retailer is gambling it can succeed with its tablet where several other giants, including Hewlett-Packard Co. and BlackBerry maker Research In Motion Ltd., have so far failed,” reports The Wall Street Journal. “Unlike those companies, Amazon already has a vast library of digital content to sell and tens of millions of credit-card numbers.”
  • The article suggests that the Kindle Fire may have an advantage over other tablets that have attempted to take on the iPad: “Amazon’s library of digital content, which its tablet users can access. Customers can pay $79 a year for a service known as Amazon Prime, which gives them access to 11,000 movies and TV shows, as well as unlimited two-day shipping for physical goods purchased on Amazon.com. Amazon also sells single movies, TV shows and music songs, with a catalog that competes with that of Apple’s iTunes store.”
  • Amazon also introduced three new Kindle e-readers — a touch-screen 3G version for $149, a touch-screen Wi-Fi version for $99, and a non-touch-screen model for $79.

Aging Hollywood Movies to get 3D Makeover: Will Audiences Respond?

  • Hollywood is moving to convert its previously-released blockbuster hits into 3D. James Cameron is spending a year and $18 million to convert “Titanic” to 3D; “Star Wars” and “Top Gun” are two others in production.
  • “Like a bunch of aging starlets, some older blockbusters are undergoing major cosmetic enhancement to prepare for their comebacks,” reports Los Angeles Times.
  • Disney recently spent $10 million on the 17-year-old animated feature “The Lion King,” whose surprising box office success during the last few weeks may lead to additional conversions.
  • “For studios, it’s easy to see why spending $10 million or so to render a beloved film in three dimensions holds appeal: There’s a built-in fan base,” suggests the article. “But there are risks too: As the number of 3D films in theaters has ballooned, American audiences have become more selective about which ones they deem worth the premium ticket prices.”
  • Software improvements have made 3D conversions less expensive and, as a result, makes the prospect more difficult for Hollywood to resist.
  • Yet despite its big-name public champions such as Cameron, George Lucas and Tony Scott, there are still those who remain skeptical. The 3D conversion “undercuts the quality of the film and the verisimilitude of the film,” believes Wheeler Winston Dixon, professor of film studies at the University of Nebraska-Lincoln. “It’s to re-direct it and destroy it. This is a poor idea artistically and a poor idea financially.”
  • Either way, the movement is underway and we should expect to see more 3D “makeovers” of older films in the near future.

Movie Studios Turn to the Internet: Are We Ready to Bid Farewell to the DVD?

  • Hollywood studios are responding to the 40 percent drop in home entertainment sales by recognizing that the future may heavily rely upon ramping up Internet delivery businesses.
  • According to the Los Angeles Times: “Across Hollywood, a quiet revolution is brewing that’s about to transform living rooms around the world… In the next few years, the growing number of consumers with Internet-connected televisions, tablets and smartphones will face a dizzying array of options designed to make digital movie consumption a lot more convenient and to entice users to spend more money.”
  • “It’s now critical that we experiment as much as possible and determine how to build a vibrant market for collecting digital movies,” says David Bishop, president of Sony Pictures Home Entertainment division.
  • Studios may be eager to change, but have yet to determine how it can be effectively accomplished with a uniform approach. As a result, the immediate future will most likely see an expanded but confusing selection of options for consumers.
  • The article looks at some of these potential options including premium VOD, cloud computing, UltraViolet’s “virtual locker,” new offerings from Apple’s iTunes and sharing movies via Facebook.

Dish Network Launches Blockbuster Movie Pass: Bad Timing for Netflix?

  • Dish Networks has announced its Blockbuster Movie Pass service that will offer streaming video; DVDs, Blu-ray discs and games by mail; and a satellite subscription service with on-demand movie channels.
  • Launching October 1, the service will initially be available to Dish subscribers and offered to others at a later date.
  • Movie Pass will include more than 100,000 movies and TV shows by mail, 5,000 streamed movies to TV and 10,000 to computer, and 3,000 games by mail. Users will have access to 20 premium Dish movie channels and the ability to exchange discs in-store at Blockbuster locations.
  • Current Dish Network subscribers will pay $10 per month for the service, while new Dish subscribers will have an opportunity for a free introductory year.
  • While the streaming capacity of the Blockbuster Movie Pass is not yet that of Netflix or Amazon, users will have access to movie offerings through Dish movie channels about a month earlier than other services. Also, Movie Pass touts “one company, one bill and one connection,” something that Netflix no longer has after splitting its streaming and mail-in services.

Four Theories on the Decline of 3D Cinema: Lessons for Revival?

  • In 2010 Hollywood studios released what Slate refers to as “a run of record-smashing, premium-priced blockbusters: ‘Avatar,’ ‘Alice in Wonderland,’ ‘How to Train Your Dragon,’ ‘Clash of the Titans,’ ‘Shrek Forever After,’ and ‘Toy Story 3’ — a half-dozen 3D movies that earned more than $2 billion in domestic sales.”
  • However, while the new generation of 3D cinema showed initial box office promise, the next wave of 3D movies have grossed significantly less than their 2D versions.
  • Slate takes a compelling look at some of the reasons 3D has recently become less popular with theatergoers and, in the process, provides information that could help revive the format.
  • Theater chains, for example, raised their prices for 3D screenings by 20 percent or more, while the 3D trend was already showing signs of decline. PricewaterhouseCoopers has suggested that 3D could revive if the chains limited their premium to a couple of dollars.
  • Some film studios applied 3D “purely for the profit motive,” as James Cameron has been quoted. Films were converted to 3D instead of being produced in 3D from the start, a technology “cheat” that some believe led to viewer disappointment.
  • Additionally, shrewd consumers may not always feel that the 3D experience is worth the extra price, especially if the 3D is designed to be unobtrusive. Film critic A. O. Scott pointed out this is “one of the pitfalls of that format, which is that if the 3D is unobtrusive enough that you don’t really notice it, you may as well forego the disposable glasses and the surcharge that comes with them.”
  • And the final theory offered by Slate involves “hack” filmmakers who have applied 3D to a string of bad movies, which may have been the same reason 3D died in the 1950s.
  • It’s interesting to note that on the heels of the Slate article, a 3D re-release topped the box office this past weekend. An enhanced version of Disney’s “The Lion King” earned $29.3 million (with 92 percent of the gross from 3D screens). This is the third time the 1994 film has been widely screened in theaters, but the first time a 3D version has been available. Was earning more in weekend ticket sales than the other three newcomers combined the result of nostalgia or the first-time availability of a 3D version?

Netflix CEO Admits Mistake: Will Reed Hastings Regain Your Trust?

  • On Friday, ETCentric provided an update to recent stock activity based on the negative customer reaction to Netflix splitting its services. The company cut its domestic subscriber forecast by 1 million, suggesting it no longer expects growth for its U.S. customer base this quarter. “News of the 4 percent cut in its subscriber outlook knocked 16 percent off Netflix’s share price, sending the stock to its lowest levels in 2011,” reported The Wall Street Journal. “Netflix, though, continued to defend its recent pricing change.”
  • Shortly after, ETCentric staffer Phil Lelyveld submitted a paidContent report that put the stock decline at nearly 19 percent and suggested “the honeymoon period with Netflix may be over.” The article includes a compelling visual that illustrates consumer viewing habits. According to Phil: “The most interesting part of this story is the chart. The chart breaks down how consumers acquire the movies that they watch, and how often they acquire them.”
  • Yesterday, Netflix CEO and co-founder Reed Hastings responded to his subscribers via a blog post, that started with “I messed up. I owe everyone an explanation.” ETCentric staffer Dennis Kuba was quick to publish the news: “Hastings explains his reasoning for a decision to create separate DVD and streaming businesses and websites. His customers react negatively to his blog posting (see more than 600 comments following Hastings’ post).”
  • “We feel we need to focus on rapid improvement as streaming technology and the market evolve, without having to maintain compatibility with our DVD by mail service,” writes Hastings on the Netflix blog. “So we realized that streaming and DVD by mail are becoming two quite different businesses, with very different cost structures, different benefits that need to be marketed differently, and we need to let each grow and operate independently.”
  • According to Hastings, the new DVD business will be named “Qwikster” and will add a video game upgrade when it launches in a few weeks.
  • “A negative of the renaming and separation is that the Qwikster.com and Netflix.com websites will not be integrated,” he explains. “So if you subscribe to both services, and if you need to change your credit card or email address, you would need to do it in two places. Similarly, if you rate or review a movie on Qwikster, it doesn’t show up on Netflix, and vice-versa.”
  • Hastings concluded: “Both the Qwikster and Netflix teams will work hard to regain your trust. We know it will not be overnight. Actions speak louder than words. But words help people to understand actions.”

More Piracy News: Grand Jury Indicts Five in Illegal Movie Download Service

  • A federal grand jury has returned indictments against five people associated with the NinjaVideo.net website. The indictments include one count of conspiracy and five copyright infringement counts.
  • The individuals were charged with engaging in illegal downloads of Hollywood movies following investigations conducted by several federal agencies, including the departments of Homeland Security and Justice.
  • “From February 2008 until June 2010, NinjaVideo.net allegedly offered users the ability to illegally download infringing copies of copyright-protected movies and television programs,” reports Home Media Magazine. “Many of the movies offered on the website still were playing in theaters, while others had not yet been released.”
  • According to the article, the site allegedly offered access to copyrighted movies and TV shows for free, with increased access to a greater content selection for users who would donate at least $25. In addition to “donations,” the website generated revenue through advertising.
  • “The action today marks one of the first such prosecutions of an illegal download and streaming site — indeed, one of the most notorious infringing sites on the Internet until it was shut down by law enforcement,” said Mike Robinson, EVP of content protection and chief of operations with the MPAA.

Social Discovery Platform: Get Ready to Prescreen Your Favorite Indies

  • A new startup dubbed Prescreen launched this week as a marketing platform for independent films.
  • Since indies typically find it challenging to gain exposure, Prescreen provides an alternative for filmmakers and distributors to generate buzz and potentially find an audience for their projects.
  • “Basically, Prescreen offers users the ability to subscribe to a daily email alert, which will inform them of one indie film per day,” reports TechCrunch. “The user can then visit Prescreen to view trailers for free and if interested, can rent movies to stream on demand for up to 60 days. Users can also earn rewards and discounts for sharing movie information on their social networks.”
  • Additionally, the service provides filmmakers and distributors with audience demographic data.
  • In response to the trend regarding more mainstream services such as Netflix and Hulu starting to feature independent movies, Prescreen founder Shawn Bercuson explains that the discovery mechanism for finding and marketing these titles remains weak. He hopes that Prescreen’s email model and social features will help address this issue.

Will Dish Network Challenge Netflix by Streaming Blockbuster Films?

  • Dish is expected to introduce a streaming movie service under its Blockbuster brand next month. The move will introduce a competitor to Netflix and coincide with that company’s recently announced price increase.
  • When Dish acquired Blockbuster’s assets in April for $320 million, it received content rights that it has sought to beef up through discussions with the studios.
  • “This ought to begin changing the way investors think about Dish,” said Ryan Vineyard, an analyst at RBC Capital Markets. “It goes from being an old-school pay-TV company to launching what could be a really high-growth business.”
  • Dish currently ranks as the second largest U.S. satellite-TV provider behind DirecTV.

Movie Site Flickme Launches, Betting Big on Social Interaction

  • Former COO of Funny or Die Mitch Galbraith launched the beta version of social streaming movie service flickme this week with deals in place from Sony and Warner Bros. The venture was founded by Galbraith and Mark Smallcombe, who received funding from Sequoia Capital.
  • The new service lets users rent or purchase movies and watch instantly, via their Facebook accounts. Users can also socially connect with friends to share deals and recommendations. According to the website: “About one third of the movies on flickme feature pass-along perks: the first person to rent or buy can share special offers with friends, including discounts and access to rentals before they are normally available.”
  • The service will face competition from streamers such as iTunes and Netflix but is hoping the social connection will make it distinct.
  • “We’ve built a short cut to find movies you’ll love,” says Galbraith. “We’re assembling a library of thousands of top Hollywood titles and enabling highly personalized recommendations from close friends to ensure every movie you watch on flickme is a winner.”

Flipboard Hopes to Integrate Video with its Social Media Magazine

  • Palo Alto-based Flipboard plans to add film and TV to its social media magazine platform. Flipboard is currently available only on the iPad, but an iPhone version is expected to launch in a few weeks.
  • Reuters reports that the company “hopes to cut deals with studios to carry movies and episodes of TV shows, getting into territory staked out by Netflix, Hulu and Facebook.”
  • Mike McCue, chairman and chief executive of Flipboard, explained he will begin the video project at the end of this year and also hopes to sell electronic books.
  • Flipboard’s service takes a cut of the revenue from advertising. “We’re trying to create the largest company possible,” said Danny Rimer, general partner at Index Ventures, a Flipboard investor. Reuters points out: “Rimer believes display advertising revenue’s migration online is ‘a very big opportunity.'”

Innovative Concept: Sony Developing Subtitle Glasses for Moviegoers

  • Sony is developing special subtitle-enabled glasses that could be in UK movie theaters as early as next year.
  • According to the BBC, one in six people have some level of deafness and are not being served well by the movie industry. In fact, many film fans with hearing issues wait for films to be released on DVD when subtitles are available.
  • “What we do is put the closed captions or the subtitles onto the screen of the glasses so it’s super-imposed on the cinema screen, [making it look] like the actual subtitles are on the cinema screen,” explains Tim Potter of Sony.
  • “The good thing about them is that you’re not refocusing. It doesn’t feel like the words are really near and the screen is far away. It feels like they’re together,” said test subject Charlie Swinbourne, who is hard of hearing.
  • “It was a great experience,” he added. “I think it’s a massive opportunity to improve deaf people’s lives and I think there’s great hope that this would give us a cinema-going future.”
  • If the glasses prove popular in the UK, we should expect to see them in wider availability in the near future.

Home Entertainment Spending Seems to Have Stabilized in Q2

  • An increasing number of viewers are turning to rental programs for movies and TV shows, according to a report from Digital Entertainment Group.
  • DEG also reports that consumer spending on home entertainment has stabilized with an unexpected recovery to the disc-based business in the second quarter.
  • The report concludes that consumers spent $4.2 billion on transactional video services — disc rental, streaming and VOD — during the first half of 2011. These figures mark an 11 percent increase over the same period last year.
  • The report also mentions a 16 percent drop in disc purchases, with combined Blu-ray and DVD sales falling to $1.8 billion in the second quarter. However, rental — including streaming and VOD — was up 11.16 percent. (Blu-ray sales increased 10 percent, while demand for DVD declined.)
  • Netflix rose 45.7 percent in the first six months of this year, while kiosk rental (mostly Redbox) rose 39.8 percent.
  • The Hollywood Reporter adds: “Spending on Blu-ray Discs was up a solid 10 percent in the first half. DEG estimates that the number of U.S. households with at least one Blu-ray Disc playback device rose 16 percent in the first six months of 2011 to bring total household penetration to more than 31.6 million, making the format one of the fastest-growing new technologies in the home entertainment industry.”

American Airlines and Gogo Roll Out In-Flight Video Streaming

  • American Airlines announced it will roll out Gogo’s in-flight streaming video service to its entire fleet of 767 aircrafts.
  • The service wirelessly streams movies and TV shows from an in-flight library to Wi-Fi-enabled laptops (at $0.99 per TV show and $3.99 per movie).
  • The current slate of 100 movies and TV shows will remain accessible for viewing after the flight has concluded. Customers will have access to the movies for 24 hours and TV shows for 72 hours.
  • The TechCrunch post includes a video demo explaining the service.

UK Intends to Make Legal Personal Copying of CDs and DVDs

  • The British Parliament signaled today that it intends to legalize the copying of CDs and DVDs onto digital devices for personal use. The new law will not allow people to share content over the Internet without permission of the copyright holder.
  • The move will update Britain’s 300-year-old copyright laws, making them comparable to laws adopted in other European nations.
  • The change was recommended by a government-requested report, carried out by a professor of digital economy at he Cardiff School of Journalism.
  • The report also recommended the creation of a central digital copyright exchange where rights could be bought and sold, but the government has not signaled its intention to act on that recommendation.