To: Stoctrash who wrote (25582 ) 11/22/1997 5:24:00 PM From: John Rieman Respond to of 50808
More Divx issues.........................widebandmag.com November 21, 1997 Early Release on Divx? Divx continues to cause a stir among video retailers. Consumers could get their hands on the coded discs through the mail weeks before official release dates. "But the early release isn't a competitive advantage at all," says John Thrasher, vice president of video purchasing and distribution at Tower Video. "The actual Divx machine won't allow the disc to be played until the official release date." Richard Sharp, chairperson and CEO of Digital Video Express and its parent company, Circuit City, told directors of the Video Software Dealers Association that direct-mail early release of discs is an option for Divx distribution. Thrasher is a member of the VSDA board. "What he (Sharp) said doesn't really change the primary concern over Divx," Thrasher explains. The prevailing dilemma is over the Divx player costing more than a standard DVD player and the potential for consumer confusion over two different formats. Sharp's announcement may have strengthened concern over the release of movie titles. According to Thrasher, retailers who sell or rent videos are not worried about early distribution; it would be the direct mail aspect they see cutting into their sales. "Many members of the VSDA are in this business, so this news is unsettling to them," he says. "If there's a new sales model afoot that could undermine your business, you get concerned." David Goodman, president of DVD International, explains his fear. "This could lead to where movie studios market direct to consumers, bypassing the retailers," he muses. "I feel strongly about this. Besides other issues surrounding Divx, I see it as a smokescreen to dominate and monopolize the video retail industry." Thrasher says the big news coming out of a recent VSDA board meeting is Divx's launch plans. "Sharp said we'll see a testing round in the spring of '98 and then a rollout in the fall." Thrasher believes everyone "will have to wait to see Divx's effect on the video-rental market." -Will Safer