Found this on one of the DVD BB's:
DIVX FORGES AHEAD, WOOS ADDITIONAL SOFTWARE
SUPPLIERS (by Martin Levine)
Key pieces of the business puzzle are falling into place for Divx,
the pay-per-play variation on DVD. Sources with direct
knowledge of the activities of Digital Video Express (Divx)
confirm that it is about to sign agreements with two disc
replicators, with a third replicator not far behind.
The agreements with replicators appear to answer one of the
more crucial questions for Divx: Can the new format turn a profit
based on the expected selling price of Divx discs, minus the cost
of production, distribution and payments to software suppliers?
Knowledgeable sources say at least two replicators--Nimbus
CD International and Panasonic Disc Manufacturing--have
agreed to per-disc pricing of about $1.50, within striking
distance of the $1.40 target cited by Divx executives last year in
briefings with the investment community.
A third replicator, Pioneer Disc Manufacturing, is also in active
negotiations with Divx. In exchange, Divx is said to have
committed to initial replication runs in the range of 50,000 to
75,000 units, well above the norm for all but the hottest
conventional DVD releases.
Divx's ability to attract additional
hardware licensees in recent weeks,
along with its apparent success with
replicators, appears to be softening
opposition from some of the DVD program
suppliers that have refused to sign
agreements with Divx. On the list of
suppliers moving closer to deals with
Divx is PolyGram Video. PolyGram Video
president Bill Sondheim said it would
be "premature" to announce an agreement
to supply movies to Divx, though
acknowledging "we've had a lot of
discussions. But we haven't reached an agreement."
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Jim |
