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Walmart Launches Disc-To-Digital Service

3/13/2012 02:56:58 PM Eastern
Hollywood, Calif. - Walmart and five of the largest Hollywood studios formally announced Tuesday an in-store disc-to-digital movie service managed by the UltraViolet virtual content locker system that will enable shoppers to purchase Cloud-based digital upgrades of their physical DVD movies.

John Aden, Walmart general merchandise executive VP, joined executives from Universal, Paramount, Warner Brothers, Sony Pictures and Fox in jointly announcing the Disc-to-Digital Powered By Vudu program.

Through the service consumers will be able to bring their DVDs into a Walmart store and pay a $2 or $5 fee per DVD (or eventually Blu-ray Disc) to get access to a digital version of the movie through the UltraViolet Cloud locker system.

UltraViolet is a digital "proof of purchase" system that allows a consumer to store a movie or TV title in a free, online personal library.

The DVD title will be made viewable to the owner on a wide range of streaming products, from smartphones to set-top boxes, through Walmart's online Vudu movie service.

Walmart's Aden said the chain is setting up merchandising kiosks in stores to help educate consumers to the service and to assist them in authenticating their existing or newly purchased DVD movies for access to a digital copy in the Cloud.

 He said having a Walmart employee hold the customer's hand through the process will encourage greater awareness and participation using the UltraViolet technology.

Discs must be owned by the user and cannot be rented or borrowed. Walmart will stamp the disc at the store to prevent other parties from using the same disc for authentication purposes.

Disc owners may pay $2 for a standard-definition digital version, or an HD version in the case of a Blu-ray Disc, or they can pay $5 to upgrade from a standard-definition DVD to a high-definition digital version.

The titles will be accessible by a Vudu-enabled tablet, smartphone, smart TV or Blu-ray player.

Walmart will have an exclusive on the in-store component of the disc-to-digital conversion program using UltraViolet technology.

Samsung recently announced plans to market select Blu-ray Disc players and HTiB systems that will have similar disc-to-digital authentication capability through the player, using the Warner Bros. owned Flixster application.

In the case of the Samsung devices, users purchase a Cloud-stored standard or high-definition version of a DVD title. Once a digital version has been purchased, it can be streamed through devices registered through the disc-to-digital program.

The studios said thousands of DVD titles will be available through the disc-to-digital program when it launches April 16.

Disc-to-digital technology will eventually be rolled out to enable Blu-ray Disc authentication as well.

Studio representatives attending Walmart's press conference called the retail giant's participation using Vudu a "big first step" in building consumer acceptance for UltraViolet capability.

David Bishop, Sony Pictures Home Entertainment worldwide president, said he believes Ultraviolet and the disc-to-digital component will "give consumers confidence" in owning both physical discs as well and digital content into the future.

To get the word to consumers, Ron Sanders, Warner Bros. Home Video worldwide president, said that UltraViolet backers will be promoting the new initiative through an advertising campaign with a budget comparable to the launch of a major feature film.

But not all industry observers agreed that the disc-to-digital would have the desired impact.

Dan Rayburn, executive VP of market analysis firm StreamingMedia, said the studios are asking too much by requiring consumers to pay again for a movie they already own.

"The studios are doing exactly what consumers don't want, which is forcing them to pay multiple times for the same piece of content," Rayburn said in a newsletter Tuesday. "The fact that consumers already spent money to buy the DVD apparently is not good enough to allow them access to a free digital copy, which they could easily get if they ripped the DVD on their own."

He added that asking consumers to pay again for movie is more likely to drive them to obtain or make an illicit copy the title rather than visit a Walmart store to pay for the privilege.
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