While I look for Zoom TV, I keep running into these guys..............................
Wave Systems creates "Pay-per-Use" system for software titles using online microtransactions; hundreds of titles on CD-ROM and DVD to be bundled with major PC manufacturers; unique "Rent-to-Own" system debuts with E3 Demo
digitaltheater.com
LEE, Mass.--(BUSINESS WIRE) via Individual Inc. -- Creating a
new distribution paradigm for the PC industry, Wave Systems
Corp. (NASDAQ:WAVX) today unveiled its sweeping new plan
for bundling hundreds of software titles with major PC
manufacturers on a series of encrypted CD-ROM and DVD-ROM
discs, the content contained on the discs can be purchased at the
micro-transaction level via the Internet using Wave's proprietary
WaveMeter technology.
"Following the broad decline of retail sales in the CD-ROM arena
this past year, we are following the successful example of the
video game industry, where most titles are rented before they are
owned," said Steven Sprague, president and COO of Wave.
"The anticipated incorporation of the WaveMeter in 1998 models
by several major PC manufacturers will enable us to reach millions
of users, who can pay for usage credits once a month and let the
meter take care of the rest, greatly simplifying Internet commerce.
We aim to be the Blockbuster Video of Internet commerce."
Sprague added that the company expects shortly to announce its
first deal to bundle the WaveMeter and 10 encrypted CD-ROM
discs with at least 2 million PCs as part of an agreement with a
major PC manufacturer, and expects to announce several other
deals with major PC manufacturers by the fall.
"The system is extremely simple and highly profitable for the PC
manufacturer and software publisher alike, as well as easy for the
consumer to use," noted Sprague. "Until now, hardware makers
have paid publishers to bundle software. With the WaveMeter
system, we pay the manufacturer a revenue split to bundle our
encrypted discs.
"There will be several free titles on each disc to enhance the
bundle's value, and the WaveMeter system will be pre-loaded
with $5 of prepaid usage so they can rent several hot titles on a
per-use basis. This gets them used to the system of renting
software on a per-use basis."
Sprague noted that Wave's patented micro-transaction
technology will allow publishers to rent titles in several different
ways: (1) on a "per-use" basis, paying by the game or by the
hour, with no minimums or maximums; (2) "rent-to-own" titles,
where each rental counts toward the eventual purchase of the
title; (3) subscriptions on an annual basis, or (4) the ability to
simply purchase the title and pay for it online.
Sprague noted that a principal difference between the new Wave
system and previously unsuccessful efforts by other major
software distributors to sell encrypted software on CD-ROM was
the omission of the valuable pay-per-use sales option.
Game Rentals by the Bullet; Future Additions Include Pay Per
Game or Hour
The first CD-ROM bundles are expected to roll out in early 1998,
these discs will allow users to rent software by the hour or by the
game. This billing can be accomplished for any title without
developer modification. Future discs will allow for new games to
be rented by internal game factors, such as selling bullets in an
action/adventure title.
"We believe rent-to-own via the Internet will be a powerful new
weapon in the arsenal of small game developers," added Sprague.
"By renting software by the game to an installed base of loyal
users who do not have to wait for the title to hit retailers, the
publisher can recoup much of their investment before pressing
their first CD-ROM."
Sprague also noted that the Wave system of encrypting usage
over the Internet (the system will also work via modem lines for
users without Internet access or who desire the added security in
a dial-in account) has several advantages over pure Internet
commerce.
"Delivering usage information can be accomplished instantly over
the slowest modem, whereas software distribution of graphic
intensive games will not happen widely until average user speeds
approach T1 levels. When we bundle multiple games on CD and
produce millions of units, our distribution cost is a fraction of a
penny per game, which makes it far less than the holy grail of
Internet software distribution."
Noting that 70 percent of all Nintendo titles are rented first, and
that 35 percent of all CD-ROM purchases are returned or
classified as dissatisfied with their purchase, the rent-to-own
model will represent a boon for consumers as well. "A $200 annual
budget for games will buy a typical user four to five A-level
titles," said Sprague. "That same budget will let the same user try
ten or fifteen A-level games, then buy the three to four they like
best."
Wave, with offices in Lee, San Jose, Calif., New York, and
Princeton, N.J., markets a distributed information metering and
transaction service, the Wave System, for use in consumer,
entertainment and education applications.
Wave's information metering infrastructure provides individual
and corporate content owners with secure distribution as well as
new marketing and pricing options that include rental,
rent-to-own, purchase and pay-per-use transactions. Consumers
benefit from the convenience and control of obtaining content via
delivery systems such as online services, the Internet, satellite
transmission and CD-ROM, DVD and broadband.
More information about Wave is available through the Wave
Internet web site: wave.com .
CONTACT: Wave Systems Corp. | Mark Marinovich,
408/261-9510 | mmarinovich@wavesys.com | or | The Terpin Group
| Jim Shissler, 415/344-4944 | jshissler@terpin.com
[Copyright 1997, Business Wire] |
