Vudu: Another set-top box offering movies on-demand

Stop me if you think that you've heard this one before: there's yet another startup venture offering a box that you connect to your TV so you can watch movies on-demand. Vudu scored a breathless write-up in the New York Times today for a new movie download service they'll be offering something this summer that is long on overblown claims and hyperbole ("This is something that is going to alter the landscape. We are rewriting economics.") and short on realistic analysis of how resistant consumers have been to paying to download movies over the internet. Vudu does have a few things going for it -- they've signed up most of the major studios and have some novel P2P stuff that helps them save on bandwidth costs and makes it possible for users to start watching a film more or less as soon as they've selected it (rather than have to wait for it to completely download) -- but that may not be enough to stand out, especially since they're planning to charge around $300 just for the box itself (which as you can guess, is laden with DRM and doesn't allow transfer to a portable device). Besides, it's already sort of a crowded market when you think about it. Most cable users have been able to get movies on-demand for years, and it's also possible to get paid movie downloads via your Xbox 360, Apple TV, TiVo (via Amazon's Unbox service), and Akimbo, to name a few. They definitely have their work cut out for them, the landscape is littered with companies (Moviebeam, anyone?) that have tried to convince consumers that they need yet another box connected to their TV and failed miserably in the process.

[Dan @ Apr 29th 2007 11:34AM]

Kind of an angry article! :)

[Smith @ Apr 29th 2007 11:51AM]

I'll give this a shot when it comes out, but it's true, something has to be truly amazing if it's going to earn a spot under my tv. They better not charge too much for the rentals.

[Curtis @ Apr 29th 2007 11:56AM]

Competition is good. I have an AppleTV and love it for want I mainly bought it for (music not movies). But Apple needs to offer HD movies to take advantage of the 720p output and a movie rental service.

Hopefully Vudu would put some pressure on Apple, Microsoft, and the others. In theory, competition helps us consumers, right?

[allens555 @ Apr 29th 2007 11:59AM]

ahaha look at their faces, they so don't like each other and they don't want to be there, ahah.

[Marian @ Apr 29th 2007 1:28PM]

Poor guys. They have to fight in a market infested with big sharks: Apple, Amazon.com, WalMart, Netflix...

[wfbnadador @ Apr 29th 2007 1:30PM]

All I'm gonna say is that looks like a multi-purpose remote.

[jds17j @ Apr 29th 2007 2:54PM]

if you look at this picture, you can see the price of the movie as $12.95, with rentals being $2.95.

http://graphics8.nytimes.com/images/2007/04/29/business/650-vudu-02.jpg

[Michael Urlocker @ Apr 29th 2007 7:07PM]

Is Vudu disruptive? How about another TV service, Joost?

Here's my thinking:
Most hybrids fail because they tend to 'cram' the new disruptive thing (Internet) into an old business model (broadcast television) in order to prop up the old declining business.
The top issue a new service must answer to become a sustainable business is "What new problem do you solve for consumers?"

Details:
http://www.ondisruption.com/my_weblog/2007/04/television_disr.html

Mike
www.OnDisruption.com

[Michael Urlocker @ Apr 29th 2007 7:23PM]

Is Vudu disruptive? How about another TV service, Joost?

Here's my thinking:
Most hybrids fail because they tend to 'cram' the new disruptive thing (Internet) into an old business model (broadcast television) in order to prop up the old declining business.
The top issue a new service must answer to become a sustainable business is "What new problem do you solve for consumers?"

Details:
http://www.ondisruption.com/my_weblog/2007/04/television_disr.html

Mike
www.OnDisruption.com

[StreetStealth @ Apr 29th 2007 9:06PM]

If Vudu were going to be based on a subscription model, i.e. an instant Netflix in a box, it would indeed change the landscape. I'd be pretty excited.

However, as just another "pay $12 for a movie that's never going to leave this box" option, I'll gladly go on record saying that it's doomed.

[doctorSpoc @ Apr 29th 2007 10:26PM]

+for all other detractors have said about nothing leaving this box... and in addition nothing comes into the box either from sources like your computer...

this is absolutely no additional value to cable movie on demand.. none! Dead on arrival! I can see why the movie houses jumped all over it.... it's locked down like Fort Knox... nothing gets in that we don't sell you and nothing at all gets out... what a piece of crap!!!

[Gary @ Apr 30th 2007 3:02PM]

Am I missing something here? Isn't this the only download service where you don't have to get your PC involved? Seems like a huge competitive advantage to me. And the advantage over cable VOD (right now)is selection. (Does cable VOD have 5,000 movies?) I agree with the comment above that if they can develop a Netflix-like model rather than a pay-per-download model, they've really got something. Also agreed that it will be hard for them to get a spot on the set top. But that doesn't seem to be too much of an issue, as their ultimate goal appears to be to sell their innovative P2P technology.

[Geoffrey Sperl @ Apr 30th 2007 6:49PM]

@Gary:

You do not need a computer for the TiVo & Unbox other than for choosing the videos. Amazon's videos will load directly to a registered TiVo - no need for loading to a computer first.

Moviebeam is actually very close to Vudu: Shop from, and download directly to, the box itself. The Moviebeam box is also $150-$200 less than this box.

Don't forget the Xbox 360, either: You shop from, and download to, the box. Only an Xbox 360, as a media center (and by that I mean a Media Center PC running in the background and an HD-DVD player connected to the console), is even more expensive than the Vudu.

It's an attractive idea, but there are two issues with such a system: 1) No portability; and 2) buying the box and also paying for the rentals... that's double-dipping.

Let's be honest: It's only a matter of time before you can, via first-party app, surf the Amazon Unbox store from the TiVo itself, and I'm sure Apple is going to create a shopping/rental capability for Apple TV. I'm just tired of the nickel-and-diming.

[Rick wilson @ Apr 30th 2007 4:42PM]

does it do hd?

[Gary @ May 1st 2007 9:50AM]

Thanks for filling me in Geoffrey. From what I can gather, Moviebeam's selection is severly limited, with the service itself deciding which movies to download to your box. And on Unbox/TiVo and Xbox Live, you have to wait for the video to download, whereas with Vudu it begins right away. Portability of video is a non-issue because it is a need for only a very small niche. I'd still say Vudu's system is in the lead right now.

[doctorSpoc @ May 1st 2007 10:14AM]

there are all these comments about how you don't need a computer to work with this box and that is good but the fact that you CAN'T stream from your computer is a limitation in my eyes... i want to be able to watch my home ripped DVDs, home movies, bootlegged movies etc and this piece of junk doesn't allow me to... i need to go out an buy yet another box for that... it's stupid? cable give you all the new release on demand too... this thing has no reason to exist.