TDG Opinions

---

       

July 14th, 2009

As you’ve probably read, Blockbuster and Samsung have signed an agreement to put Blockbuster OnDemand on Samsung’s televisions and blu-ray players. While many are lauding move as a "coup" for Blockbuster, this is merely the evolution of previous announcements for both companies such as mutual support for Yahoo’s Widget Channel.

"Blowing up" versus just "blowing"

So will this move "blow up" the market for Blockbuster? Look at the lack of traction Blockbuster had with their Blockbuster / 2Wire box. Back in April I wrote that it "leaves much to be desired" – which we all realize is analyst speak for how bad the solution really was. I wouldn't share my internal notes of "stinking dung-heap of a movie service," except to point out how far Blockbuster’s offering will have progressed when released this fall.

First, this is a completely different offering than the box of yesteryear – wait, last year. First, delivery to the television will use Widget Channel meaning easy scalability across not just Samsung sets, but any television that has BOTH Widget Channel support AND an open interface to allow the app to be added (current deployments and paytv providers use closed interfaces). Samsung’s Blu-ray players will not utilize Widgets and will instead have an embedded application.

Second, as I mentioned in that same article, access to the latest, greatest content is critical. For years, Blockbuster has been negotiating rights to digital delivery and can offer a rental model that Hollywood finds much more appealing than the blanket subscription programs being offered by Netflix. While many consumers want subscriptions, per title rental model for the latest releases will not go away anytime soon.

The Unmentioned Winners

Looking beyond just the announcement, let’s think about the players actually delivering the service. While not covered directly in the announcement, there are three winners beyond just Blockbuster and Samsung. They include:

Yahoo/Intel

This announcement provides further support for Yahoo’s Widget Channel. For Intel, who is already providing Samsung with the CE3100, better services provide a differentiated experience and more chip sales.

CinemaNow

CinemaNow is powering Blockbuster OnDemand. This is another important player in the video delivery chain. In case you haven’t been keeping tabs, CinemaNow recently announced a deal with Best Buy, is delivering content to the Nintendo Wii in Japan (and, obviously, we all expect to the US at some point soon), and now adds Blockbuster. As we continue to see the rise of virtual operators, CinemaNow seems in a very good position to capitalize on the lowest hanging fruit, the retailers. 

See: Retailers and Over-the-Top Video Services: Missed Opportunity?

Widevine

While many of us, including TDG, have been talking about Adaptive Streaming for some time, we usually think about Microsoft, Move, and Adobe. In the background, Widevine has been developing their own "adaptive streaming–ish" technology that utilizes a progressive download model for delivery to the device.  This provides some advantages especially in terms of delivery and hardware costs. Widevine will also be powering the delivery of Blockbuster OnDemand, what I believe to be the first big commercial win for Widevine’s Video Optimization offerings.

ShareThis