Andrew Colley | November 25, 2008
EZYDVD'S attempt to resurrect ReelTime Media's commercial internet movie service has been aborted as local internet service providers come under pressure from Hollywood to curb illegal movie downloads.
EzyDVD managing director Jim Zavos said the service, rebadged EzyDownload and scheduled for a September launch, had been shelved due to market conditions caused by the global financial crisis."Retail is going through a bit of a hard trot at the moment," Mr Zavos said. "The project is on hold but we plan to pursue it later next year should the economy or the market circumstances change."
The first signs of cracks in the company's plan appeared in September when private equity expected to be injected into the online movie venture dried up, Mr Zavos said.
The infrastructure behind the business would not be dismantled and liquidated, Mr Zavos said.
However, it's understood server equipment obtained on lease from Sun Microsystems has been sent back to the vendor.
Under the EzyDownload model consumers were expected to be able to download movies to view on their computers using a proprietary software video player that protected movie copyright.
Movies were expected to be priced at about $5.95 per new release. EzyDownload also planned to use the service to complement its retail business by bundling free downloads of digital versions of movies with DVD purchases.
The company's decision to shelve the movie download service, which had several false starts under its previous operator, ReelTime Infotainment, coincides with a crackdown by studios on internet movie copyright infringement in Australia.
Last week, an international armada of 34 movie studios and content owners launched Federal Court action against Perth internet service provider iiNet, accusing it of encouraging and permitting its customers to infringe copyright.
The claim was lodged after the Australian Federation Against Copyright Theft engaged investigator Aaron Herps and Copenhagen anti-piracy firm DtecNet to conduct a lengthy investigation gathering evidence against the service provider.
Mr Zavos said the situation could assist the EzyDownload service in the long term.
"I think that's going to work in our favour, but it's not going to make us switch it on any quicker in the short term," he said. EzyDVD's core business had not been immune to recent difficult economic conditions.
Sales from its traditional online retail DVD business had fallen 10 per cent in recent weeks, he said.
EzyDVD had planned to launch the service after picking up $5 million worth of assets and infrastructure of failed internet movie startup ReelTime Infotainment for a few hundred thousand dollars.
At the time, EzyDVD had just pulled out of a joint marketing deal with ReelTime Infotainment's owner, ReelTime Media.