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New system aims to boost sales, curb piracy

Changes in copy-protection rules have opened an exciting new world of possibility for retailers nationwide and Walgreens is eager to become the first to jump on this bandwagon.

Walgreens locations across the country will have kiosks installed in their photo department next year.  These kiosks will burn and vend popular movies on DVD within 15 minutes.

Walgreens representatives claim the system will increase selection and decrease piracy.

Walgreens is looking to one-up rival CVS with incentives like improved photo departments, in- store health clinics and exclusive merchandise.

Studios are intrigued at the possibility of these kiosks because they see it as a way of possibly marketing niche movies -- everything from old black and white films to B-horror movies.  Traditionaly many of these films have "gone extinct" and are no longer available as there is not enough market for to pay for manufacturing, storage and shipping fees.  This may soon change with this system.

Walgreens is the largest drugstore chain in the U.S. with over 6,000 stores.  Spokeswoman Tiffany Bruce was enthusiastic about the move, saying:

"We hope to launch DVD-burning kiosks in the next few months. We think its a type of solution that will work very well in our stores, giving us the ability to provide a virtual inventory to a diverse customer base."

DVD Copy Control Association, a group of movie studios and hardware makers that watches over DVD's CSS (Content Scramble System) Protection Scheme are responsible for the change in policy.  After meeting last month, they decided to allow their technology to be licensed more broadly.  This allows for movie kiosk licensing of the technology, making such devices legal.

Such copy protection schemes are typically broken.  Even the ACSS, the Advanced Content Scramble System used on Blu-ray and HD-DVD has been cracked lately, as reported at DailyTech.

Sonic Solutions is providing the software backbone for Walgreens kiosks.  The software firm markets its software based on recently approved industry specifications.

Making DVD discs isn't as easy as some think according to Sonic.  They say that their Qflix software needs special DVD burners and recordable discs in order to be used.

If such a system could be made to be compatible with modern dvd writing drives, it would open even more possibilities as sales direct to customers of dvds via services such as iTunes and Amazon would be possible.  Some customers might prefer this to buying the episode in digital format, as the services currently provide.

Sonic is licensing the QFlix software to kiosk manufacturer Polar Frog Digital LLC, which is obtaining the licenses for films from studios.  Polar Frog Digital indicated that it will focus on older movies, to avoid competing with or undercutting sales of new releases.

Blockbuster hopes to implement such a system in the near future, be it via proprietary consumer hardware or standard DVD drives.

Randy Hargrove, Blockbuster spokesman was emphatic about this possibility.  He said:

"The burning capability is a perfect complement to our Movielink download business, because it will eventually enable consumers to store movies on their hard drives or DVDs for future usage."

He also sees Blockbusters installing similar kiosks on site to provide hard to find or out of stock titles.  He says if such possibilities make sense, Blockbuster will jump on them.

The only downside to the Walgreens system, which may also come to Blockbuster is that studios have not indicated a willingness to discount the DVDs at all, even for older titles.

Still some will enjoy the ability to locate scarce titles.

Analyst Kurt Scherf with Parks Associates sees such motivations as the driving factor for the creation of a sizable new movie sales business sector.  He says that by 2011 he predicts on demand dvds will generate on-demand DVDs will generate $1.3 billion, about 1/19 of today's total market.  Such a business sector would be small, but of high interest to big retailers.

For now Walgreens is hoping it will gain a competitive edge by leading the way with this new technology.


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How much?
By MADAOO7 on 10/29/2007 5:14:54 PM , Rating: 2
The real question that will determine it's success is price. No one in their right mind is going to pay the same price as buying it at Best Buy, etc. Also, DVD burners are nearly standard on even budget PCs. If I want a burned movie, why wouldn't I just rent it and burn it myself for $5?




RE: How much?
By sapiens74 on 10/29/2007 5:25:20 PM , Rating: 1
I believe at first they may ask for a premium, due to the nature of the service. But new DVD are under 5 bucks now, so it should be around that price for the convenience


RE: How much?
By Alexstarfire on 10/29/2007 6:07:23 PM , Rating: 2
Where are new movies under $5?


RE: How much?
By mmntech on 10/29/2007 6:15:12 PM , Rating: 2
I'd like to know that too! I guess he's buying his DVDs at the Chinese flea market. lol.

This calls to mind past kiosk schemes. Print your own greeting cards, DVD rental vending machines, etc. Personally, I don't see the point of this. Of course it's an obvious advantage for the store because they don't need to dedicate as much shelf space for movies but for consumers, isn't it better just to buy a boxed copy? Unless these "burn-your-own" DVDs are cheaper, I can't see this taking off.


RE: How much?
By spluurfg on 10/29/2007 6:34:14 PM , Rating: 2
IE new DVDs in shrink wrap... not necessarily new releases... deep discount dvd anyone? =P


RE: How much?
By clovell on 10/29/2007 5:31:09 PM , Rating: 2
...because you'd be breaking the law?

And, because while almost all budget PCs have a DVD burner, not nearly as many have another DVD-drive - so instead of burning on the fly, you're ripping an image and then burning the image - that's time-consuming.


RE: How much?
By MightyAA on 10/29/2007 6:30:24 PM , Rating: 3
To me, it comes down to cost as well. I know I'm saving them substantial cost by purchasing a electronic copy burned onto a dvd. Pass those savings along and increase sales on something I'd otherwise not buy. Sorry, but the fancy cases and "marketing" box have a value to me versus a raw dvd. Not printing, shipping, marketing, and storing the product has value to the studio trying to find those extra sales. If the cost is the same, I'll take the finished product please versus something that looks like a street vendor should be selling....


RE: How much?
By Roy2001 on 10/29/2007 7:09:02 PM , Rating: 2
I believe rent and copy/burn is illegal.


RE: How much?
By SunAngel on 10/29/07, Rating: -1
RE: How much?
By rdeegvainl on 10/30/2007 6:46:41 AM , Rating: 2
Why do you limit yourself to only Dailytech. I don't want to be blasphemous but Dailytech is not the world, not the be all end all of legality.
Also even if breaking copy protection is legal for fair use reasons, doing that to rented dvds wouldn't be, that would still break the copyrights of the ip holder.


RE: How much?
By Spivonious on 10/30/2007 11:13:42 AM , Rating: 2
Fair use gets misused quite often these days. here is the text of the law:

quote:
purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.


Nowhere in there does it say "personal copies."

And for the record, copying a rented DVD is illegal. You have the right to use that DVD for as long as you are renting it. Copying it is akin to photocopying a library book. Unless you're using this DVD for educational or research purposes, it's not allowed.


I smell a lawsuit!
By sapiens74 on 10/29/2007 5:09:43 PM , Rating: 2
Wonder how long it will take for the MPAA to sue once they figure they are owed more money




RE: I smell a lawsuit!
By Nik00117 on 10/29/2007 5:16:01 PM , Rating: 2
I think its a good idea, its not like your going to be ilelgal buring a movie there. IF anything your going to be buying a movie, which may be old and no longer sold.

Like a night ax the roxbury is a example of a older, but good movie.


RE: I smell a lawsuit!
By zombiexl on 10/29/2007 6:17:05 PM , Rating: 2
my hoe for a good funny old movie thats not on DVD would be something more along the lines of The Kentucky Fried Movie.

Night at the roxburry hardly counts as an older movie.. I'm sure you can still find it on DVD if you want, if not its becuase they cant sell it.


The public and private versions...
By xphile on 10/29/2007 8:31:41 PM , Rating: 2
Public
"DVD Copy Control Association, a group of movie studios and hardware makers that watches over DVD's CSS (Content Scramble System) Protection Scheme are responsible for the change in policy. After meeting last month, they decided to allow their technology to be licensed more broadly."

Private
We decided to make this great technology widely available. To date it has done a fine job safeguarding the industries digital medium and while we were concerned about unleashing it into the wild we have the greatest confidence in our protection mechanisms. As you can see we are a great organization with great merit. Sorry what was that - oh the microphone's off? Oh yes of course Im tripping, yeah everyone knows it was cracked 5 minutes after, wait no BEFORE it was released... yes I really am just here pushing pens and coke around this desk, but I get well paid for it do anyways...

Public
"Sonic Solutions is providing the software backbone for Walgreens kiosks. The software firm markets its software based on recently approved industry specifications.

Making DVD discs isn't as easy as some think according to Sonic. They say that their Qflix software needs special DVD burners and recordable discs in order to be used."

Private
Yes we know that's horsesh!t, you could burn a disc on a standard set of multi-recorders in a box with flashing lights for a tenth of the price with software straight out of an OEM envelope but for cr!sts sake dont include that in your article, we have a hell of a profit margin here to safeguard. Qflix is a great new proprietary format. Same code new name and more DRM style protection - and if we can get $10 a disc for something that costs 10 cents to make that's called business and dont you dare call it daylight robbery.




ITS A TRAP !!!!!!!!!!!
By ZimZum on 10/29/2007 8:46:40 PM , Rating: 2
http://catmas.com/images/2007/07/its-a-trap.jpg

This has sting operation written all over it.




Out of print movies
By prenox on 10/29/2007 9:36:38 PM , Rating: 2
If this allows people to buy out of print movies, then maybe I can finally get a copy of 1984. I am sure there are lots of other people looking for other titles that are out of print. I wonder how this would hit the ebay aftermarket of some of the older titles.




About time!
By kileil on 10/30/2007 2:49:58 PM , Rating: 2
Oh how I've longed for a movie burning station to get rid of these VHS tapes. The neighbors complain when I use the fire-pit out back.




Burn those DVD's
By timmiser on 10/29/2007 7:45:55 PM , Rating: 1
I saw the headline and immediately thought this would be some kind of fire pit kiosk where I could bring my KISS DVDs to burn them all back to hell!




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