A group of media and electronics companies announced Tuesday an agreement on an all-formats system called UltraViolet for digital downloads. The single standard will allow the consumer to purchase films to be viewed on any device - a PC, smartphone, X-box, tablet, Blu-ray player, and television.
Backed by 48 companies, including film studios such as Paramount, Warner Bros., Sony and Fox, and tech firms like Microsoft, Toshiba, Panasonic as well as Intel and Comcast, the consortium, called the Digital Entertainment Content Ecosystem, covers the spectrum of entertainment, software, hardware, and retail companies.
The only holdouts are the Walt Disney Company, which has developed its own system called KeyChest, and Apple's iPad and Apple TV. Whether they will participate in the future is unknown.
UltraViolet, a universal file format, could launch by the end of the year or in 2011, after the system is tested with an unnamed retailer.
A "digital locker" will store DVDs, Blu-ray discs, TV shows and movie downloads in a cloud of servers to be accessed with a code for the proof of purchase from a store or online. The consumer can then view the film anywhere and on any equipment, from mobile phone to television set without the having to copy the file.
In an effort to offset the decline in DVD sales, the studios will emphasize the benefit of buying a movie for use on any device, once the concern about format is eliminated.
In the US, home video products, including discs, downloads and rentals, fell by 5 percent in 2009, dragging a $2 billion decline in DVD spending, according to industry association The Digital Entertainment Group.
Spending on digital downloads and video-on-demand (VOD) rentals accounts for only 4 percent of sales currently, but that figure is expected to increase as consumers move from physical products. It may be possible to burn the file onto a DVD to share with others.
There are some issues to resolve such as making UltraViolet-compatible material compatible with all retailers, cable systems, and other transactions. But many companies see it as a way to make their film libraries valuable.