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Universal does discs, downloads

Studio films find Love online

Hollywood has taken its first step toward selling digital copies of movies over the Net.

In the first deal of its kind for a major studio in any market, Universal Pictures U.K. has pacted with Lovefilm, England’s Netflix equivalent, to launch a service by which users will be able to pay one price to get a movie delivered online and, several days later, via DVD in the mail.

A source at Universal said it’s the first example of a model the studio hopes to replicate around the world, including in the U.S.

While every studio offers movies for online rental under a system in which downloaded films disappear from one’s hard drive after a certain number of days, U’s service is the first to allow downloads that buyers own.

It’s notable that U decided to send DVDs separately, rather than let users burn downloaded copies onto DVD. Latter option would be significantly cheaper for the studio but afford less protection against piracy.

Also significant: Films will go on sale the day they hit homevid. Movies typically aren’t available for online rental until they are in the later video-on-demand window.

U will offer 35 titles through the service, including “King Kong,” “Pride & Prejudice” and “Serenity,” when it launches April 10. For prices ranging from £9.99 ($17.46) for catalog pics to $35 for new releases, customers will get two permanent digital files — one for PC and the other for portable devices — and a DVD mailed by first-class post the same day as the online download is purchased.

Downloads will also be available via AOL U.K., which has a partnership with Lovefilm.

“Download-to-own has the potential to completely revolutionize the way people watch movies,” said Peter Smith, prexy of Universal Pictures Intl. “The entertainment industry is changing quickly with the introduction of new delivery channels to consumers and an emphasis on instant access.”

Numerous online retailers in the U.S., including Apple and Amazon, are known to be looking for the rights to sell movies for digital download. With the launch of this service in the U.K., it looks most likely that such offerings will typically include a DVD via mail rather than the ability to burn the film onto disc, as users can do with downloaded music.