• NY Times, Tuesday, February 14, 2006 12 PM

A new service called MovieBeam lets viewers watch movies on demand for only $3.99 for current titles and $1.99 for old ones.  The price sounds good, and it lets movie fans avoid an annoying trip to the local Blockbuster outlet, but there’s a catch.  In order to get the movies, consumers must buy a $230 box from an electronics store and hook it up to their TV sets. The New York Times reports that MovieBeam is built around a technology that broadcasts movies slowly over unused portions of the television signals to set-top boxes that store them on a hard disk. Users will have a choice of 100 movies--mainly those that have been recently released on DVDs--with 10 new titles replacing old ones each week. The service was originally developed and tested in three cities last year by the Walt Disney Co. and is now being offered on a broader scale.  But the question remains: will viewers pay more than $200 for a box, plus a fee per movie, when cable systems are offering movies on demand at similar prices through their digital services?  "The pricing model seems to be somewhat questionable here," said Michael Gartenberg, an analyst with Jupiter Research. "People will ask why they need to spend that much money for a box."

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