DivX: Taking charge of the delivery

October 15, 2008

When we hear the term DivX, what usually comes to our mind is a media player, or a set of Codecs that we shove into our QuickTime or Windows Media Player to be able to watch a certain type of media file. Did we ever think that this company would take a leap and begin to think about competing with the likes of Apple iTunes in Content Distribution? Well, they have.

They have just signed a deal with Warner Bros.  which gives them the right to digitally distribute their movies. This is in addition to their existing deal with Sony that distributes movies via a plethora of platforms using the DivX technology- including the game and mobile devices. These two deals now give DivX access to virtually half of the world’s movies!

The reason behind such firms backing DivX is their secure platform which prevents piracy. Besides, why should a studio restrict its distribution to one particular digital outlet? Warner also have a deal with Microsoft’s XBox to distribute their movies as well as with Cinema Now- a leading online retailer of movies in digital format in the US.

This is a development that is going to majorly challenge Apple’s closed-loop distribution of- Ipod/Iphone-Itunes-AppleTV. Why should a distributor or a digital retailer like ITunes (or Cinema Now) restrict access to a particular device? DiVX are likely to make the whole movie distribution eco system a bit more open. Although, their temptation to get a bigger share of the revenues via distribution to a proprietary device is quite visible in their DiVX Connected device. This device is a heaven for anyone who indulges in torrents every now and then for a bit of .avi fun!

Lets wait to hear how DivX front this distribution deal, and how much are they going to charge consumers for the movies. Apple’s ability to lead the pricing models for the digital content is quite likely to be affected here. Cinema Now sell movies from anywhere between 10 to 16 dollars. An equivalent of that price in the UK might not under-cut Apple’s current pricing… but then who knows. There is a great potential for DivX to take a leap into an advertising funded model here as well.

I say keep an eye on DivX!

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