Cynthetiq

'Datacasting' Refuses to Die
By Elisa Batista

Story location: http://www.wired.com/news/business/0,1367,60716,00.html

02:00 AM Oct. 07, 2003 PT

The Walt Disney Co. piqued the interest of film buffs last week when it unveiled a set-top box that comes with 100 pre-installed movies, 10 of which get replaced automatically each week with newer flicks.

The MovieBeam service, which costs $7 a month plus $2.50 to $4 for each movie watched, is designed to let movie enthusiasts avoid trips to the video store and late fees.

"You can't underestimate the convenience factor," said Alan Reiter, a wireless technology analyst and movie buff who subscribes to Netflix, a service that lets subscribers rent as many as three DVDs at a time and keep them as long as they want for $20 a month. "If you are sick of Blockbuster and don't want Netflix and want immediate access to 100 movies, (MovieBeam) might make sense."

But, wearing his analyst hat, Netflix fan Reiter noticed something unusual about Disney's service. To power MovieBeam, Disney is using one-way data broadcasting, a content-delivery mechanism considered a bust in the 1980s and then again in the late 1990s as a "dot-bomb."

"The business has been around for decades, and it's gone through hills and valleys," Reiter said. "Mostly valleys."

Rather than build their own networks or rely on more-modern methods -- like cable, satellite and broadband Internet connections -- to deliver video on demand, so-called datacasters rent analog airwaves from television and radio stations to push their products. In this case, Disney is leasing airwaves from ABC and PBS to sell movies to customers.

But, as Reiter pointed out, companies before Disney "have gone through valleys" to deliver their products in this fashion. Because datacasters must strike deals with individual radio and television stations, their services are slow and costly to roll out.

And just as radio stations cut out when drivers leave coverage zones, there are plenty of holes in datacasters' networks, as Sony learned in the mid-1980s when it attempted to launch a (now defunct) one-way paging service. Sony got beat by competitors that built their own networks, which touted ubiquitous coverage.

"(Data broadcasting) is a one-way data business," Reiter said. "Usually it's fairly slow speeds and usually you have to purchase a proprietary, expensive box. You connect the box to a computer or another box like a (digital television) set and you get information on it. With the rise of the Internet and two-way broadband, you haven't heard much about data broadcasting."

Until now, that is. Besides Disney, another big-name company plans to launch its own datacasting products: Microsoft. The software behemoth said wristwatch makers Fossil and Suunto plan to release products based on Microsoft's smart personal objects technology, or SPOT, platform, which runs on FM radio waves. Microsoft said it was easier and cheaper to leverage existing technology than to build out an entirely new network.

The one-way datacasting will allow Microsoft to push up-to-date information -- such as weather reports, stock quotes and news -- to the wristwatches. But the company echoed Reiter, admitting the technology's biggest disadvantage: its coverage, or lack thereof. If wearers of the fancy wristwatches leave the coverage zone, their devices will still give them the time. But users won't have access to updated data until they return to the coverage zone.

"The time will always be accurate," said Chris Schneider, spokesman for Microsoft. "All information delivered to your watch, your appointments wouldn't disappear from the watch. It just would not be updated until you got better coverage."

The first SPOT products will appear on the market before the end of the year, Schneider said.

At first, Disney plans to offer MovieBeam only in Jacksonville, Florida; Salt Lake City; and Spokane, Washington. But the company plans to expand the service throughout the country over the next year, said Tres Izzard, senior vice president and general manager of Buena Vista Datacasting, the Disney company in charge of MovieBeam.

While Izzard is aware of the bad rap datacasters have gotten over the last two decades, Disney insists datacasting is the best way to deliver this product to movie lovers. The MovieBeam box, manufactured by Samsung, only works in the household for which it was ordered, thereby eliminating the need for roaming outside the coverage area, Izzard said. MovieBeam customers must have a phone line, but they don't need cable or satellite TV service or a broadband Internet connection to access the large, ever-evolving movie library.

Disney is able to offer customers almost any movie desired because the company has signed up all of the major studios except for Paramount. (Paramount is owned by Viacom, which also controls Blockbuster -- a MovieBeam competitor.)

The main reason the company was able to bring almost everyone on board is that one-way datacasting gives Disney complete control over the security system, allowing it to combat piracy and keep crackers at bay.

"Many of (the studios) have come back and have said this is by far the most secure system," Izzard said. "We do encrypt all the data, and the receiver itself uses smartcard technology."

Disney's latest offering may breathe life into datacasting, said Carmel Group senior analyst Sean Badding.

"What they are doing, in a way, is improving the old technology and delivering it to the masses in such a way that is not so expensive," Badding said. "They are providing the consumer with a movie experience they can have on demand. (Consumers) have a library of 100 titles to choose from. The choice becomes more apparent with MovieBeam ... compared to their cable or satellite operators when it comes to on-demand movies
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But if my cable company has video on demand and they are housed on their server, then why would this technology be viable? Wouldn't it make more sense for the cable companies to just bring in more storage and just kill Disney's plans before it even gets off the ground? Seems like a waste of investment $$$.

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krwlz

Seems expensive as well. Pay per view on DTV is like 4 bucks I think. Plus all the channels you get for your subscription.

phredgreen

anyone remember divx? i see this machine taking its place next to thousands of discareded divx players and useless discs sooner than later. i see these developers traversing many more valleys before they end their journey.

make me eat my words, disney. i dare you.

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ratbastid

I always knew somebody would come up with a decent commercial application for the good ole Verical Blanking Interval.

But.... It only works one way. So how does this device communicate billing information to the mothership? It's got to have a modem connection too, right? That's pretty lame.

Now the data watch, I can see that being a decent application of a one-way datacasting service. Thing is, how do you tell the watch your preferences? There's still got to be some sort of upstream communication. Or maybe you jack it into your computer, feed it preference information, and then it discards data you're not interested in.. That would make sense.

Ah, VBI, you much-maligned little slice of bandwidth, you! I always believed in ya!

tinfoil

Meh.. They have talked about it for years and nothing has come of it.

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