Major US retailers such as Wal-Mart, Target Corp and Best Buy Co are evaluating the potential of DVD download kiosks to ensure their continued share of the USD 24 billion home DVD market. In other words, retailers that previously sold discounted DVDs at their stores, now see download-to-burn kiosks as a way to counter moves by Hollywood studios to offer digital content downloads to PCs, cell phones and laptops.
By fall 2007, DVD could be burned in stores, according to insiders, but as happened with music-burning kiosks, some licensing and technical issues need resolution.
In 2004 Wal-Mart, Target and Best Buy accounted for 50 per cent of all sell-through DVD sales, the Video Software Dealers’ Association reports. During 2003, Wal-Mart was also the top DVD sell-through retailer in the US, with USD 3.2 billion in sales, more than double those at Target Corp. Installing digital on-demand kiosks at their stores would however enable these retailers to offer customers all 6,600 Warner Bros movie titles over the Internet, and possibly titles from other studios that entered the market, while freeing up shelf space for the most recent DVD titles.
Retailers installing a DVD rental kiosk at their stores stand to gain at least an extra USD 4,000 to USD 5,000 in annual net income, according to figures from self-service solutions firm, Coinstar. If mass-market retailers did deploy DVD-burning kiosks, the dynamics of the DVD rental industry would alter drastically, but this hinges on inter-industry talks by hardware makers and IT firms. For progress to occur, a universal DVD watermark technology and a new method for CSS (Content Scrambling System) authentication, the copy-protection system used on DVDs, must be chosen.
