Blockbuster isn't the only rental outlet to get movies before Netflix and Redbox, as DirecTV announced that it will sell on-demand films on the same day as their DVD release.
The satellite television provider has deals with Warner Bros., Universal Studios and 20th Century Fox, the same three studios who now delay their new releases to Netflix by 28 days. DirectTV's deal with studios covers as many as 400 movies, Bloomberg reports.
Movies on DirecTV cost $4.99 to $5.99 each, and are available for either 24 hours or 48 hours after playback begins. Subscribers can put movies in their queue before release and have them download as soon as they're available. DirecTV claims that the quality of the satellite picture is on par with Blu-ray.
Netflix agreed to delay DVD releases from Universal and Fox earlier this month, and from Warner Bros. last January. In exchange, the studios will provide a greater selection of streaming movies and television shows, which Netflix offers free to subscribers of its mail-order DVD service. I see this as a smart move on Netflix's part, as Web video is on the rise and Netflix has the best subscription-based library around.
Meanwhile, studios are primarily trying to save DVD sales by striking these deals, but they've at least shown that they're not opposed to video on demand, as both Blockbuster and DirecTV will offer new releases for download on the same day as DVD. In doing so, they're effectively separating the home video business into two categories: The premium ones that get new releases on time, and the cheaper ones that don't.
It remains to be seen what Fox and Universal will do about Redbox. The rental kiosk operator already has an agreement with Warner Bros. to delay new releases by 28 days, a deal resulted in the end of a lawsuit between the two companies. The other two studios have also sued Redbox, so settlement talks could be underway.
