Best Buy breaking into movie downloads?

April 17, 2009 | Terrence Russell | Comments | |

Anyone who has stepped into a Best Buy retail store has seen its rows and rows of DVDs. But as the physical media market starts to wane, Best Buy is setting its sights on a new frontier — digital downloads. Sources close to the studios say the electronics retailer is preparing to launch a movie download service as early as this summer, reports Variety.

Details are still sketchy, but Variety’s sources say Best Buy will probably follow in the footsteps of Blockbuster by forging a partnership with movie download service CinemaNow. Ideally, the agreement would allow the retailer to sell specially branded web-ready hardware (TVs, set-top boxes, Blu-ray players, etc.) that ships with automatic access to CinemaNow’s 14,000 feature-length titles. Since the goal is to offset Best Buy’s lagging DVD sales, speculation is pointing to a pay-per-download setup for the rumored service.

It’s hard to say whether this move is audacious or desperate. On one hand, Best Buy is smart to capitalize on the evolution of living room entertainment. After all, web-enabled TVs were all the rage at CES this year, and next week’s NAB conference is slated to reveal even more strides in that space. Likewise, the popularity of Tivo has made the set-top box a must-have (and easily expandable) device for the living room. If Best Buy were to forge a solid enough agreement with manufacturers to get its fledgling service on their products, it might actually stand a chance (pricing and content catalog permitting).

Of course, there’s also the issue of timeliness in a crowded market. Digital media A-listers like Apple, Amazon, Netflix, and Blockbuster are already fighting it out in this space — and that’s not even taking into account past failures like Wal-Mart’s movie download pact with HP. If Best Buy wants to evolve its brick-and-mortar DVD sales into movie downloads, then it’s going to need more than a CinemaNow partnership. For success, it’ll also have to pile on wide support from hardware manufacturers, high-level studio backing, an intuitive user interface, and movies. Lots and lots of must-have movies.

[photo: flickr/kylemac]

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About the Author, Terrence Russell

Terrence writes about online video and digital media licensing for Venture Beat. When he isn't binging on the newest television series to hit the web, Terrence contributes to WIRED Magazine and Wired.com.

  • This seems like a wise choice. With ISPs offering so much bandwidth so cheap, it seems reasonable to assume that sooner or later getting movies through traditional media (dvd, blue ray, etc), will become obsolete. Best Buy is making a smart move by getting into streaming and downloading before it's mainstream. Great business strategy.
  • TerrenceRussell
    Ibrahim,

    Totally. I think it's smart for the company to try to follow such a potentially dynamic trend. Still, I'm kind of uneasy over Best Buy's ability to run a solid download service. By no means are they doomed, but they've got a lot of bases to cover to pull things off right.
  • Steve Mobs
    I think best buy is in a good position. For one to download the streaming movies to your laptop or tv, you will need the hardware, which Best Buy sells. Thus Best buy will have the first shot at selling their streaming services to the customers.
  • Patrick
    I can't really see switching from my already well established VUDU Box over to a new download service. It seems to me that Best Buy should if anything partner with an existing set-top box maker and work from there. VUDU would be good as they already sell the VUDU in Best Buys. That's where I bought mine.

    If Best Buy ventures out on their own they will have a tough run as the market is getting pretty crowded.
  • I agree with the video downloads and other wing components for improving our technology, which is a more damage...
    http://www.naturals-products.com
  • Best Buy BUILT itself on the "get a free PC with AOL" deals, remember? That and selling warranties and same-as-cash offers on BB credit cards at 95% margins.

    Why would they NOT do same with the movie-driven device sales, as well as netbooks with their wireless relationships? In fact, who ELSE has all the bases (suppliers, service vendors, devices, etc.) covered. I would
  • Best Buy's ability to run a solid download service. By no means are they doomed, but they've got a lot of bases to cover to pull things off right.
  • The idea of having built in access to downloadable movies is great. I would rather pay to have the movie downloaded instantly to my TV, then to buy the DVD and have it sit on my book shelf forever.