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UltraViolet Hits 800,000 U.S. Households

CYBERSPACE: UltraViolet, the so-called “digital rights locker” technology that allows users to port their content to multiple devices, now has 800,000 U.S. household accounts, according to market research from IHS.

IHS notes that the UltraViolet initiative “has made rapid progress” since it was launched last October with the introduction of UV-enabled DVD and Blu-ray discs. The initiative represented the content industry’s answer to preventing piracy while allowing file-sharing within a household. UltraViolet stores and manages the digital rights of content purchased by a user, who can register up to 12 devices for playout. It handles the rights for both physical and electronic media from participating content creators, which now include Warner Home Entertainment, Flixster; Sony, Universal and Paramount Pictures.

UltraViolet’s U.S. user-base has grown by 50,000 since the Consumer Electronics Show in January, IHS said. For each account, users have redeemed the rights to 1.25 titles, meaning their collective content library exceeds 1 million.

“One million may not sound like much compared to the 504 million movie discs sold in 2011,” said noted Tom Adams, principal analyst and director, U.S. media, for IHS. “However, we have projected that only 19 million digital film files were sold during the entire year of 2011 by electronic sell-through vendors like iTunes, Xbox Live and Vudu. This suggests that if UV can continue to gain momentum this year, it could encourage consumers to buy more movies. Movie purchasing represents an important priority for movie studios, which have seen their film sales dwindle in the face of growing physical and digital rentals and streaming services like Netflix.”

People rent more content than they buy, according to IHS numbers dating back to 2006. Digital rentals outpaced digital purchases last year by 300 percent. Rentals cost less and make more money for retailers and distributors. Studios make more when people buy content, digital or otherwise--IHS says as much as 80 percent reaches the studios’ top-line revenue.

Recent UltraViolet developments include the coming availability of Flixster on Panasonic smart Viera TVs and Blu-ray players; a compatible Blu-ray Disc player in development from Samsung that will unlock older non-Ultraviolet discs “for a nominal fee;” and a deal between Amazon and an unnamed studio to offer electronic sell-through of UltraViolet enabled titles later this year. Additionally, Neustar, which manages the UltraViolet database, has debuted Catalyst, an UltraViolet “storefront” for retailers.
~ Deborah Digital McAdams