ReelTime To Launch The Next Failed Movie Model

Australia-based (not to be confused with Seattle-based will be launching a new movie download service this week called “RealTime DTO” (for download-to-own). The service, which is available to Australians only, is being called the first legal download service that allows DVD burning (which isn’t accurate – see below).

James Bannan
published an interview with a ReelTime exec, John Karantzis, earlier today. The service, which will work only on Windows machines for now, will offer movies from at least one major studio – Universal. Purchased movies will be deliverd as three separate files. One for PC viewing, one for portable device viewing (using Plays4Sure DRM), and one for burning to DVD. The last file may be burned three times to DVD within a thirty day period. After that it’s useless. New releases are being priced at AUD$33.99 (about US$26.50).

In the U.S., both MovieLink and CinemaNow are experimenting with DVD burning features, and both have deals with Universal. See our coverage here and here for more information on those and other movie download services.

ReelTime’s pricing is prohibitively high. Putting that aside, however, there are still problems with the service. Users want to be able to consume content on multiple devices, including mobile devices and a normal television via DVD. ReelTime is addressing this by delivering three different files, each with a different DRM scheme (the files will not play on an iPod, however). The fact that ReelTime is trying to address this demand is commendable. But delivering three files, all with different restrictions, is not the right solution. It’s too much to download, and managing the files is a real cost to users.

It’s clear that studios are trying to avoid the fate of the music labels by doing deals with just about every startup (see chart in this post) with a dream of getting a piece of the multi-billion dollar DVD and movie rental markets – just as long as the pricing is high enough to keep major offline DVD retailers happy and the files are completely locked down with DRM.

But there are too many services chasing the very small market for price-insensitive consumers who are willing to live with DRM and restrictions on portability of content. Margins are razor thin. Apple and one or two others may get enough market share to survive. The rest are chasing a pipe dream, and so are their investors. As long as BitTorrent is widely available to users, clunky alternatives just don’t have a chance.

Thanks for the tip, TalkUSB.