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UltraViolet Called Digital Delivery 'Do-Over'

1/17/2011 12:01:00 AM Eastern
LAS VEGAS — A multi-industry coalition including Hollywood studios, electronics manufacturers, retailers and video providers, formally unveiled at International CES a virtual content locker designed to simplify and consolidate the purchase of video content for playback across multiple devices.

The proposed system, called UltraViolet, is expected to launch this summer and will enable the purchase of movies and TV shows as a download for use on up to 12 devices at any one time, and to be shared with up to six relatives or friends.

Consumers will be required to register UltraViolet titles they have purchased to make use of the sharing provisions. Registered titles will be playable on up to 12 UltraVioletenabled devices at one time, and old devices can be removed as new ones are added.

An UltraViolet logo will be placed on compatible hardware devices, content listings on retailer’s e-commerce systems, and on DVD and Blu-ray packaging — signifying that the purchaser of the disc also has the right to access a digital version of the title in a vertical content locker administered through UltraViolet account system infrastructure, which was designed by Neustar.

The coalition, called the Digital Entertainment Content Ecosystem (DECE), developed the Ultraviolet platform after seeing shrinking home video sales and revenue in recent years.

Consumer feedback indicated that people are buying fewer movies and TV shows because they are frustrated with and confused by their inability to use that content flexibly across various devices and device brands. Studios hope that a more flexible solution will both spark renewed demand, and reduce piracy.

Speaking at a DECE press conference here Thursday, Mitch Singer, Sony Pictures chief technology officer and DECE president, called UltraViolet the result of a collective industry “do-over” on digital distribution.

“Many industries that have rolled out in the past where there has been a proprietary vertical platform have done do-overs,” he said, citing everything from ATM cards to text messaging systems. “Let’s figure out what the consumer experience should look like if we had it to do all over again.”

Studios involved in the venture include Lionsgate, Paramount, Sony Pictures, 20th Century Fox and Universal Pictures.

Walt Disney Studios, which is working on a separate and similar system called KeyChest, is not part of the group.

Data released Thursday by industry trade organization Digital Entertainment Group showed that total revenue from DVD, high-definition Blu-ray discs, and digital sales and rentals declined 3 percent in the United States to $18.8 billion in 2010.

Combined sales and rentals of Blu-ray discs, which were up 53 percent in 2010, and digital downloads and streaming, which grew 19 percent, were not enough to overcome the 11 percent decline in DVD revenue to $14 billion, the DEG said.

At the same time, less-profitable rental revenue grew 2 percent to $7.8 billion as sales dropped 7 percent to $11 billion.

Although few devices are expected to be UltraVioletready when the system launches this summer, DECE members expect products including smartphones, video game consoles, tablets and computers to be upgraded to support the platform in firmware and software downloads, before devices integrating the capability are readily available next year.

The DECE lists 46 other members, mostly from the technology side of the industry, such as Best Buy, Comcast, Samsung, Sony and Toshiba.

Noticeably absent from the list is Apple, which is a major shareholder of Disney, the proponent of the rival KeyChest platform.

The DECE announced earlier this month an evaluation suite of technical specifications and a licensing program that will allow companies to use the technical specifications, interact with the UltraViolet Account infrastructure via a suite of Application Programming Interfaces (APIs) and use the UltraViolet logo for promotion and marketing of UltraViolet content and devices.
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