Stuart Corner
Wednesday, 01 November 2006 06:37
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Video rental store chain, Video Ezy, has hit back at competition from online movie services with technology that enable customers to walk into a store, take home up to 30 rental movies on a portable storage device (including an iPod) and pay for them only when, or if, they play them on the custom-built player.
The key to the service is a home media centre (HMC) combining digital television receiver, 160GB hard disc drive recorder and an encoder/decoder using the H.264 technology.
This is being supplied by Sydney-based Mobilesoft (ASX: MSO). It features Mobilesoft's patented security anti-tamper technology and its ADAPT TV product which will enable it to be upgraded remotely. According to Mobilesoft, "Hollywood Studios have been supportive of this new delivery mechanism, and have approved the business process. Agreements have been reached with four major studios to provide content to Video Ezy for use in the Home Media Centre for the trials."
The customer transfers the movies from the storage device to the HMC with a simple plug connection and they are then available for viewing on standard television sets. Normal playback functionality such as pause, fast forward and rewind are supported from the consumer's remote control.
Mobilesoft announced to the ASX in August a four year conditional contract and told the ASX today: "We are now able to reveal that this exclusive contract is with Australia's largest movie rental franchise, Video Ezy which intends to launch an electronic rental service for movies at home...The contract is for the supply of up to 390,000 of a unique Home Media Centre (HMC) running the next generation ADAPT TV product developed by Mobilesoft...Revenues for this contract over its four year life are projected to be in the range of $45 million for a base case, to more than $150 million in a high case depending on consumer acceptance."
The contract is conditional on field trials which started on 31st October and will progressively take place in 40 homes throughout the Sydney Metropolitan are. They will be extended to regional Australia from early 2007.
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