MovieBeam's failure surprisingly swift
MovieBeam, the service that tried to deliver movies over a set-top box, has been sold for less than $10 million, a major loss for investors and sign of how quickly the movie industry is changing — and consolidating.
Movie Gallery, a major video rental company, is the buyer.
MovieBeam had tried to deliver its movies over a box costing between $100 and $200. People then had to download the movies. But few people want pay for such a box when there are so many cheaper alternatives, especially lately.
After losing $56 million in 2005 on the nascent video service, original owner Disney spun out the service last year, and MovieBeam got $48.5 million more in funding at that time from a group of Silicon Valley venture firms, including Mayfield, Norwest and VantagePoint, as well as Intel and Cisco. Disney retained a stake too.
But in less than a year, that effort apparently had failed. Movie Gallery said in its statement that it “expects that the total incremental expense related to MovieBeam, including the initial acquisition cost and any ongoing development expenses will be less than $10 million in 2007.”
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About the Author, Matt Marshall
Matt launched VentureBeat in September of 2006, with the realization that no one else was covering the entrepreneurial and tech innovation scene with the velocity or depth that he was. Prior to founding VentureBeat, he covered venture capital for the San Jose Mercury News from 2001 to 2006. In 2002, Matt was awarded "Journalist of the Year" by the Northern California Society of Professional Journalists. Prior to working at the Merc, he was a correspondent for the Wall Street Journal in Bonn, Germany from 1995 to 1998, and a writer for the Washington Post in 1994. Matt holds a PhD in Government and an MA in German and European Studies from Georgetown University. In addition to VentureBeat, Matt is also the Executive Producer of DEMO, the leading launchpad event for emerging technologies.
