Studio pacts with Netco for online sales
Online video company Guba is the latest to jump on the Hollywood bandwagon, pacting with Warner Bros. to sell and rent movies and TV shows on its Web site.
San Francisco-based Netco is in talks with other major studios as well in hopes of building a fully stocked digital movie library.
Major studios are working with a variety of video Web sites with the aim of building a robust and competitive market for digital distribution of their content.
In addition to smaller sites like Guba, they’re all in negotiations with major etailers like Amazon.com and Apple iTunes (Daily Variety, June 19).
Warner has thus far been the most aggressive. It is the only studio to pact with Netcos beyond Movielink, which is owned by five major studios, and CinemaNow, which counts Lionsgate as a major investor. Studio also has a distribution deal with video search company BitTorrent, though that digital videostore hasn’t yet launched.
Eight-year-old Guba has primarily distributed videos from Usenet, an early version of the Internet that allowed for bulletin board-like postings. Usenet has fallen out of favor in recent years amid the rise of the Web.
While it’s keeping its library and hosts user-submitted videos, Guba is adding a vidstore featuring premium content from the major studios.
As with other etailers, it is paying wholesale rates similar to those of DVDs for permanent downloads of movies and renting pics in the pay-per-view window on a revenue share basis for between $2 and $5.
As is becoming standard on the Web, Guba will charge consumers $9.99 for library films and $19.99 to buy new releases.
“We’re the first non-industry guys to launch a videostore in the U.S., and we want to move forward aggressively with our first mover advantage,” noted Guba CEO Tom McInerney. “We think we can stand out by combining user video with premium studio content.”
Netco is launching with more than 200 WB movies and a handful of library titles for which networks don’t control the rights, such as “The Flintstones” and “Dukes of Hazzard.”
Guba draws around 1 million visitors per month and hopes to turn just a small fraction into paying customers.