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Disney to Unveil System to Bypass DVD Ownership

Disney is expected to unveil technology next month that will give consumers “access rights” to movies and TV shows, allowing them to pay a single price for permanent access to content across the web, mobile devices, and cable services that allow on-demand viewing.

The technology, known as Keychest, allows users to purchase rights to a movie from a participating store, and the user’s accounts with other participating services, such as mobile providers or VOD cable services, show the content as available for viewing, the Wall Street Journal reports. The movies reside with the particular delivery company, and the user can access the movie from any device. This could mean an end to the necessity of owning of physical DVDs.

Disney has not named any other participating companies.

If successful, Keychest could conquer the hurdles that are holding back widespread adoption of movie downloads, mainly the difficulty of playing movies on any device other than a computer, and limited computer storage space.

DVD sales have plunged by 25% for some studios, weakening the studios’ business model. Keychest, though it may not be profitable for as many as five years, could bring the category “up to a healthy state where we can expect growth in the future,” says Bob Chapek, president of home entertainment at Disney Studios.

Time Warner and Comcast are working on a similar initiative, dubbed TV Everywhere. The service will allow subscribers to access their favorite cable content on other devices. Currently, a challenging debate is taking place between content owners and the cable operators on a proposed revenue split.

It could also be a challenge for Disney to rope movie studios, which may be unwilling to allow a competitor to control access to their content, into participation on Keychest.

Keychest could compete with the Digital Entertainment Content Ecosystem (DECE) initiative - made up of five major Hollywood studios and tech companies like Comcast and Intel - which hopes to create a new set of standards and formats to allow viewers cross-channel access to content. The DECE website says the group is a “consortium of some of the world’s top media companies,” and says the consortium will “provide a revolutionary new way to enjoy your favorite movies and TV shows.” The website contains no other information, but encourages visitors to “come back soon to learn how this groundbreaking technology will dramatically change how we experience digital entertainment.”