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Non-Tech : BBI: Blockbuster, Inc.

BBI 0.919

+2.1%

Jan 3 3:00 PM EDT

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To: Walter Morton who wrote (1)	9/6/2001 8:51:58 PM
From: Walter Morton	Read Replies (1) of 3

Will Internet Video On Demand Replace Video Stores? "Until recently, the cost of transmitting a two-hour movie over broadband has run about $5 - roughly $2 more than most viewers will pay for a movie rental. But with the new technology, the cost falls to about $1.25, leaving room for profits even after the cost of content is added." "You're getting a benefit on two fronts," said On2 CEO Douglas McIntyre. "Bandwidth costs are dropping and compression technology is improving. The low cost of compressing and distributing video-on-demand over copper wires or cable spells trouble for video retailers. For example, Blockbuster tried to strike deals to distribute video-on-demand, but was rebuffed by most of the studios. The studios prefer to do business with companies such as the regional Bells, which have potentially millions of customers and low overhead. To prove its ability to stream video with acceptable quality, On2 posted the first feature-length film on a Web site, the cult classic Sleepaway Camp": ( on2.com ) zdnet.com

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