Wednesday, December 8, 2010

Movies at Home, for $20,000

A proposed service aims to bring movies to homes the same day they hit theaters, a milestone that Hollywood has long anticipated with a mixture of fear and fascination.

But there's a catch: At the prices currently being discussed by Prima Cinema Inc., the start-up that is touting the service, those movies will reach only world's the best-appointed living rooms.

Prima plans to charge customers a one-time fee of about $20,000 for a digital-delivery system and an additional $500 per film. The Los Angeles-based company has around $5 million in backing from the venture arm of Best Buy Co. and General Electric Co.'s Universal Pictures, and hopes to start delivering movies to customers as soon as a year from now.

The steep price has been met with mixed reactions in Hollywood. Some executives question whether it will be possible to build a market beyond a few thousand users. (Prima says it plans to install its systems in 250,000 homes within five years.) Others say the high price would create an exclusive, super-premium niche market without cutting into existing sources of revenue.

Prima isn't the only company trying to bring movies to homes faster. Time Warner Inc., which owns Warner Bros., has said it expects to test an early-release offering with a new film as soon as next year. Under the program, consumers would pay roughly $20 to $30 to watch digital copies of movies within a month or two of their release in theaters.

For the complete article, please click here.

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