Hollywood is in the deal-making phase of its campaign to distribute movies over the Internet, but showtime for the resulting ventures is still some way off.
The biggest challenge has been drawing the studios together behind a common platform that would provide viewers access to a wide array of movies -- seen by many in the industry as a needed step if beaming movies via the Internet is to succeed.
"The negotiations are proving far more difficult than technological issues," Yair Landau, president of Sony Pictures Digital Entertainment told Reuters at the Streaming Media West conference.
So far the movie studios have not had to contend with a threat like Napster, which attracted nearly 17 million users to its all-you-can-swap music service at its peak in February, before a court injunction shrank its popularity.
Even so, security experts estimate that as many as 400,000 bootlegged films a day are already swapped on the Internet.
The longer the studios wait to launch their own ventures, the harder it will be for them to control the final distribution channel of their movies, they said.
"There's still a lot more questions than answers regarding companies' commitments to an architecture for distribution and production," said Andrew Frank, technology officer for Viant, a digital media consulting firm.
Frank believes the next few months will be crucial.
Sony, Disney in the lead
Sony and Walt Disney have so far taken the lead with separate initiatives to use the Internet to distribute movies.
"We're in active discussions with other studios. Consumers have shown they want content from many studios," Sony's Landau said.
Sony Pictures had hopes to launch its own online movie service, MovieFly, this autumn, according to sources.
The service will rent hundreds of films from Sony, Vivendi Universal's Universal Studios -- and possibly News Corp unit Twentieth Century Fox.
However, the service's launch has now been pushed back to later in the year.
"The films are encoded and ready to go. We're comfortable with the technology. But there are many other issues involved in trying to get a lot of studios to agree on this," Landau said.
Sony's video-on-demand model would allow users to download movies from its Web site to their personal computers where they can be viewed for a fee, sources have said.
Alternatively, Disney is said to be studying delivering films via the Internet on a wireless set-top box.
Disney Internet Group executive vice president Dick Glover told an industry audience at the Streaming Media West conference that the transition from piracy to legitimacy for video on the Web would be difficult.
"When you think about the effort to convert an analogue library, it is staggering and delaying. But we're not letting that daunt us," he said.
