MGM signs second internet streaming deal

Cable World, Feb 25, 2002 by Richard Cole

MGM has announced a deal with CinemaNow to stream video-on-demand over broadband Internet connections, giving the studio yet another alternative to VOD and pay-per-view distribution over cable systems. MGM also recently made a VOD deal with Intertainer.

MGM, along with Sony Pictures, Paramount, Universal and Warner Bros., is also part of the Movielink consortium, which plans to offer VOD over DSL by the end of 2002.

The Intertainer deal includes potential access to all of MGM's 4,100 films, while the CinemaNow agreement is limited to a 30-day test of two films.

On the cable side, Intertainer is working with Comcast to supply VOD in six markets and with Adelphia in its Cleveland system, says Intertainer spokeswoman Louise Rasho.

The company has about 50,000 registered users of its broadband Internet movie site, although Rasho declined to say how that has translated into actual buys.

"We just started marketing it in January, so it's pretty early still," she says. Intertainer once had a DSL distribution deal, but that has ended, Rasho says. The MGM films will be available to anyone in the top 60 U.S. markets who has either a high-speed DSL or cable connection.

Some MGM films covered under the deal are already up on the site, including Legally Blonde, priced at $4.50 for a 24-hour license. Eventually Intertainer expects to stream many others, including the Rocky and James Bond series, she says. The movies will be released on the Internet site in the same VOD and PPV windows that cable companies use.

MGM's deal with CinemaNow is much more limited, says studio spokeswoman Tracey Studebaker.

Only two films--the remake of The Man in the Iron Mask (starring Leonardo DiCaprio), offered for $2.99, and What's the Worst That Could Happen? (starring Danny DeVito), for $4.99--are included in the deal.

"It's really just a test," Studebaker says. "It's limited to two movies; it's limited to 30 days. We're just going to collect data--find out how much people will pay for download movies, if the technology works, if the protection technology holds."

The companies would not reveal the financial terms, but Intertainer's Rasho says revenue-sharing arrangements are typical in such deals.