By the end of the year, Australian consumers will be able to choose from at least three separate video on demand (VOD) services. However, some sceptics question whether the local market is ready for online film distribution.
Having recently signed a hosting deal with Hostworks, CEO of ASX-listed DVD rental service Quickflix, Stephen Langsford, said the company was currently developing and testing VOD technology. However, he predicted it would be at least five years before it became a serious market force.
"I'm not convinced there is large demand for VOD. We're not going to get ahead of ourselves in a market that's not there yet," he said. "Slow broadband is a big stumbling block because most people don't have the service to get the movie they want when they want it. They are not prepared to spend $800 on new equipment."
CIO of ASX-listed VOD distributor RealTime Media, John Katantzis, expressed similar concerns although he said they could be overcome.
"We intend to launch in July and will offer the VOD service through a PC or set-top box. Consumers can decide how they want to watch movies," he said. "We're going to have a no frills option at about $300 and a flashier unit with an integrated digital tuner for about $800. Both will be available though finance."
RealTime Media has been piloting its download service through ISP, Adam Internet, in Adelaide. Karantzis was unable to provide details until figures had been released to the ASX.
Video, DVD and games rental franchise, Video Ezy, also has plans to launch a set-top-box-based VOD service by the end of the year to be charged at a monthly rate and bundled with movie offerings.
"The beauty of the set-top-box option is that we can sidestep broadband issues," company director, Paul Uniacke, said.
The only company to broadly test the market so far, BigPond Movies, isn't revealing too many details about who's logging on or how.
Group manager of corporate affairs, Craig Middleton, said the VOD service launched in February was initially quite successful, and had continued to track inline with expectations.
"We had a huge response when we launched, which indicated to us that the timing was right for movies downloads and that we had a critical mass of broadband users in Australia ready to take up a legal movies download service," he said.