Starz Shines With Vongo

Expect rivals to join the movie download bandwagon.
Author:
Publish date:

Premium movie service Starz Entertainment Group, a division of

Liberty Media

(L) - Get Report

, is launching a new movie download service that is sure to raise a few eyebrows in Hollywood and beyond.

The company, which offers 13 digital movie channels with a combined 39 million subscribers, on Tuesday rolled out its Vongo broadband video download service. Vongo will allow consumers to watch movies and other video on Windows-based PCs, laptops, mobile devices and TV.

"Vongo will provide the key content application that will drive a new era in portable video delivered over the Internet," said Starz chief Rob Clasen in a statement. "By combining the wide array of programming choices on Vongo with a host of new portable media devices being announced this week at the Consumer Electronics Show, consumers will be able to seize control of their video and watch whatever, wherever and whenever they want."

According to the company, Vongo subscribers will have unlimited access to more than 1,000 movies and video selections, as well as a live, streaming Starz TV channel, for $10 per month. Members may download movie and video selections to three eligible devices per account, and select popular pay-per-view titles for $3.99 per movie.

The service is likely to act as a wake-up call to other premium services such as

CBS's

(CBS) - Get Report

Showtime

and

Time Warner's

(TWX)

HBO

, which have yet to break new ground where such extensive download services are concerned. It will also present challenges for film exhibitors, who worry about the collapse of so-called film release windows.

Starz also announced the first in a series of planned agreements with partners that include

Sony

(SNE) - Get Report

Connect and

Microsoft

(MSFT) - Get Report

. Sony Connect will make Vongo a cornerstone of its new Connect Video service, to be launched later this year. Starz worked with Microsoft to ensure quality video viewing.

Vongo will aim to use Starz's broad distribution rights on films that include recent hits such as

The Incredibles

and classics such as

Pulp Fiction

.

"Liberty is excited about this new service from Starz, not only because of its potential revenue stream, but because it positions us as the content leaders in this new era of portable video and personal consumer choice," said Greg Maffei, CEO-elect of Starz parent Liberty Media Group. "This re-defines what it means to 'go to the movies,' because with Vongo, the movies go with you."

"Critical to this service are the Internet distribution rights we have acquired from our studio partners," said Starz's Clasen. "We share with them a concern about the piracy over the Internet and so have built in a robust digital rights management system to ensure that only those who are authorized to use this service will do so."

Starz Entertainment Group is the exclusive subscription provider of first-run, classic and favorite films from leading Hollywood studios including Walt Disney Pictures, Miramax Films, Touchstone Pictures, Hollywood Films, Sony Pictures Entertainment, Columbia Tri-Star, Screen Gems, Revolution Studios and others.

On Tuesday, Liberty was set to open the day's trading at $7.87.