Comcast is expanding from renting to selling movies from major studios by the end of the year, sources confirmed.
The nation's largest cable operator will join digital streaming platforms such as Apple's iTunes and Vudu in allowing users to purchase films in an evolving new window leading into the traditional homevideo window, known as "early EST" or, as studios recently agreed to call high-definition copies, "Digital HD."
The Wall Street Journal and Reuters.
Early EST is not to be confused with the controversial premium VOD, which involves movies bowing in tandem with or shortly after the beginning of the theatrical window. Early EST comes after hotels and airlines get films, or several weeks before the traditional three-month separation between theatrical debut and homevideo.
More and more big movies have launched in that window, including "The Heat," "Iron Man 3," "The Great Gatsby" and "Star Trek Into Darkness." Titles are available for approximately $15.
With the major studios recently agreeing to adopt the Digital HD brand for all HD movies available in the early EST window, the addition of a broadly available distributor like Comcast provides yet another shot in the arm for driving the value of ownership to U.S. consumers. While rental transactions outnumber movie purchases, the latter category is of huge importance to the studios because they have a much higher profit margin than the former.
Comcast intends to make movie ownership available through its Xfinity TV platform, which allows access to a huge trove of rental titles regardless of whether they are being accessed on TV, mobile or PC to authenticated subscribers. A cloud-based locker would be built into the Xfinity platform where the content could be accessed.
Comcast has more than 20 million cable subscribers in the U.S. The MSO reported a loss of 129,000 subs in the third quarter.
Currently, Comcast offers its subscribers 36,000 titles through its set-top VOD service and 270,000 videos online. About 70% of digital video subscribers use VOD monthly.
Comcast is currently in talks with Netflix to add the streaming video service to its cable boxes and new X1 product. X1 is a cloud-based service, introduced last year, that Comcast hopes will attract new customers with its user-friendly interface, better search functionality and enhanced DVR.
Overall, Comcast's third-quarter net profit slipped 18% to $1.73 billion, while revenue declined 2.4% to $16.15 billion.
Marc Graser contributed to this story.