Google+ meet your new best friend—the Verizon Coinstar mashup. Coinstar of course owns Redbox, you’re favorite grocery store DVD distributor. The two together are offering…something. They’re not Neflix—the other convenient way to watch movies. Thus far, they really haven’t promised much of anything.

The announcement may be sort of a premature statement as shown by the lack of news. But two things are clear: the merger will happen and it will offer streaming. It sounds more like a pain than a blessing. The Verizon/Coinstar merge is likely based on a point system. Without knowing what that means, it sounds both tricky and difficult. Groan. Right? Twelve easy steps to watch one Ron Schneider movie. Lucky us.

So where does the problem lie? Well, Netflix found out last year that breaking up the streaming and DVDs is a big no-no. Amazon and iTunes charge too much, but you can grab episodes of television shows and movies pretty easily. Where else is there to go with this merge? Yes, both companies are big deals, and credit where credit is due. However, just because they are good in their respective fields does not mean coming together to produce something no one was looking for is a good idea.

Unless they’re going to produce something mind blowingly new, I have a feeling they’re kicking a dead horse.

November 20th was the first time I saw an actual commercial for Ultraviolet, the digital locker the studios are hoping will rescue, or more like salvage a fraction of, the dying home entertainment industry.  Since the peak of the DVD business in the mid 2000′s, consumers have dramatically moved toward the rental business, also known as Netflix, Redbox, Hulu, Itunes and now Amazon Prime.  Why spend $20 on a DVD when you can watch unlimited movies for $10 a month via Netflix or rent one for $1-$2 via Redbox.  I definitely joined that band wagon.  I used to make weekly trips to Best Buy to grab the latest DVD release but I honestly don’t remember the last time I bought one.

In an industry where the major players fray from transparency and playing nice with each other, Ultraviolet represents the beacon of unification. All the majors, sans Disney (who always seems to go solo on major initiatives), are working together to build the Ultraviolet platform.  For those who don’t know Ultraviolet, just think of it as a digital locker of DVD’s that you always have access to. Right now if you buy a DVD or Blu Ray, you are given a free digital copy which you can upload to your Ultraviolet account.  Just like Netflix streaming, you can log right into your Ultraviolet account and play the movie. Except your copy is your own…that’s right, you own it, it’s NOT considered rental.

Remember the joy of collecting baseball cards, I do. Baseball cards when I was 10 became DVD’s when I was 20. Studios want to recapture that, and as right with the times, are using cloud computing to salvage that business.

It’s been about a month now since the official launch of Ultraviolet and I really haven’t heard much of it since.  I haven’t seen much marketing for it or buzz from consumers.  Maybe I watch less television or just addicted to fast forwarding through commercials.

Warner Bros was the first studio to launch an actual product for sale, direct via the new platform, which was the last summer’s hit Horrible Bosses.  Here you could directly log into Ultraviolet, and buy the copy of the film. But, if the studios are planning to rescue home entertainment with Ultraviolet, then why didn’t WB use the final Harry Potter DVD as the initial digital launch.  Just to clarify, at this very moment you can buy a digital copy of the final HP installment. My question was targeted towards it not being the first release on Ultraviolet.   Wouldn’t HP be a bigger opener than Horrible Bosses? And, wouldn’t HP bring more attention to this new platform.

I just don’t know about Ultraviolet. The platform needs much cleaning up, which means more cross-studio teamwork.  Sure, it is WAY to soon to tell. Many moviegoers don’t even know what it is, and could very well jump start a rescue to home entertainment if the product catches fire. It seems that some studios are waiting until the product gets much better before they choose to digitally release some of their libraries.  I think that makes sense. However, do I think that Ultraviolet will be what the studios hope it will be.  Well, eh. And I’m basing it on myself. I used to LOVE buying DVD’s. Now, I don’t care so much. The access to online rental streamers, much improvement in the quality of television, and the popularity of gaming has got people occupied in their homes.

When does the next season of Game of Thrones start?

Why is this information important? Well, as The Wrap has reported, UltraViolet is being presented as the savior of the failing home entertainment market. How failing is this market? Oh well, DVD sales just fell a mere 44% last year (44%– that’s huge!), due largely to online streaming websites and video on demand. But alas, UltraViolet has now ridden in on its great white horse here to save the day, combining the physical ownership of a DVD with the Internet, web streaming capabilities favored by customers of companies like Netflix. UltraViolet is, thus, offering “new freedom with new UltraViolet digital copy,” says it’s commercial, by allowing access to your movie collection from a variety of forums.

Sounds great? Well, I have just one main concern: the digital streaming aspect of this next great hope is currently free for only a year. After that, studios have the option of launching additional fees for watching your own movies, that you have already paid for. Will people actually go for this? I mean, charging the hypothetical customer additional fees a year later to watch a movie he already owns seems a bit (or a lot) like highway robbery to me.

So what do you think, Banterers? Is UltraViolet going to be the life support that the home entertainment sector needs? Or will it just be another red herring in the face of Internet streaming sites and video on demand?

Yesterday, the company decided their split of Netflix into two separate entities was a bad idea. This is about a month after everyone else did. Qwikster, the harebrained spin off service, has disappeared due to 100% negative feedback. (No, I have not done the research, but that number seems likely, doesn’t it?) Qwikster was going to handle the DVD-by-mail part, while instant streaming would still be available on Netflix.

There are times when a move like this would seem like a pain for consumers, but, it’s easy to see the reason is behind greedy shareholders and businessmen.

“If we split the service, make it inconvenient for all our existing customers, and charge more, we’ll so much money! Guaranteed! We are the best!” –Reed Hastings

Well, after months of an increased price and the original split announcement, Netflix has lost roughly a million of its subscribers. Then there was this last weekend.

So what did they do? What would everyone else do in these situations? They ran as fast as they could back to their comfort zones. Netflix is one whole unit again, and the world can sleep in peace tonight. Gone are the bad dreams of having two pay TWO bills for price of one service. No more questions like, “What’s a Qwikster?” Today, we are free again! Welcome back, Netflix. I know it was a rough month for you. Me too. Now I need to go get my friend’s password again.

To clarify, you same moochers now get added cartoons. Starting in 2013, you can see all your favorites installments of Shrek, Madagascar, and Kung Fu Panda. Given by 2013, there will probably be six more films in each franchise, making it an even better deal. Also by 2013, there will probably be a substantially smaller Netflix library anyway. A smaller base would then mean less viewers followed by less investors followed by less Netflix all together. Uh oh. But this is good news?!?! I think so?

The large amount of bad news to come with this medium amount of good news is that Netflix has lost Disney and Sony due to the end of its Starz deal. Oops. That’s a lot of good content.

Really, Netflix is in a tough spot because studios and premium cable channels hate it. However, streaming films on a computer or a new fangled television is the future. Either that or Blockbuster filed for bankruptcy way too early and people are going to want to walk into video stores and deal with the oh-so-friendly customer service they provided again. Party like it’s 1996!

“What’s a video store?” – Everyone in 2012

So while the future waits to confirm my suspicion, there is a little more good news on the horizon. Netflix MAY be reaching a deal with Warner Brothers to show some of its T.V. shows. There nothing as reassuring as a good maybe, that’s what my mom always told me. Good luck Netflix.

Just to recap:
Pros
Netflix gets Dreamworks Animation.
Netflix may almost be close to possibly working out a deal with Warner Brothers for television shows.

Cons
Netflix loses deal with Starz soon.
Netflix loses Sony.
Netflix loses Disney.
Netflix charges more, loses customers.

What may that solution entail? Decreasing said price increases? Nope not that one. Well what about giving all of his faithful customers a couple months of credit? Definitely not that! Okay, fine: how about just uniting the video streaming and dvd rentals once again under one common price point? Ha, just the opposite in fact.

All that this email actually offered us was a change in name. Yes, that’s right, a change in name. From now on, the name Netflix is only to be used when referring to the company’s online video streaming, and now, the name Qwikster will be used when referring to the company’s dvd mailing system. So now, we have two separate companies (under one roof) and two different credit card charges, with the 60% price increase to remain of course.

Well, this is just great news, Netflix! This really does just change everything. Now that you’ve gone and added a separate name to the video delivery service, well I’m more than happy to pay more than double the money I was paying for the exact same service last month. So thank you, Mr. Hastings, for telling me of this good news, and so early in the morning.

Oh wait, did I say good news? What I should have said, was thank you for giving me no news so early in the morning, and under a guise of an apology, no less. Here’s the thing Netflix: if you really want to get back the million subscribers and the almost 50% stock decrease you lost last month due to your similar announcement of “good news,” the way to do this is not just to create two different companies offering the same deal as before. I mean, it doesn’t take a business major to understand when the man is damning us. And until you understand that, Netflix, I believe you’re in for a long season of a rapidly decreasing customer base and similarly plummeting stocks. Yikes! It’s going to be a long winter.

It was recently announced that Starz and Netflix could not renegotiate their contract and are ending their relationship.  The deal will officially end in February 2012 when their contract expires. Netflix had offered to pay Starz $300 million per year for its library of material of movies and TV shows, which includes, among others, the hit show Spartacus, Camelot, Torchwood, and the new Kelsey Grammer show BOSS.

According to our sources, Starz made roughly $1.2 billion last year in revenue. This $300 million would be equivalent to 25% of their previous annual revenue. Yet, they still turned it down. Why? While it is obvious they clearly value their library, there must be some other reason to turn down that much money.  While we explore the Starz reasons shortly, I did want to add that this negotiation failure brought Netflix shares down 20+ points or 8.64% last Friday. In fact, Netflix shares have pretty much tumbled in the past 1-2 months after reaching a historical high of 298.73 on July 12th, 2011. Though, the overall market has suffered in that period as worries of a further recession lurk our economy.

Some people in the industry are saying that negotiations broke down after Starz executives tried to have Netflix increase their streaming prices again, after announcing a change in the price structure this past July. That announcement, or price hike, didn’t go over so well with customers and Netflix stock also suffered shortly thereafter. Enforcing another change to the pricing structure is an interesting move on Starz’s part. Since Netflix came to power of the digital distribution and movie rental mountain, content providers (i.e. Starz, HBO, Warner Bros. etc) have been forced to sit at the mercy of their new monarch.

Starz’s ploy to have Netflix up prices is basically an attempt to have Netflix damage itself. A weakened Netflix is better for all content providers since content providers would have more leverage at the negotiation table. Essentially, the exact thing content providers are looking for. The ending of the Starz & Netflix  relationship is evident that Reed Hastings, Netlix’s CEO, didn’t bite the bullet.  And per the details of the offer, oh just a cool $300 mil, nor should he.  So Starz basically said “get lost.”

$300 million is a lot of money for Starz to pass up.  Perhaps Redbox or Blockbuster, Netflix’s biggest competitors (though both are not nearly as in good shape as Netflix), will make an offer for the Starz library and take content share away from the company that everyone seems to be using these days.  In fact, maybe Starz had something else in the pipeline prior to their contract negotiation with Netflix which we will find about shortly.  Dish Network, Blockbuster’s parent, recently said their are almost ready to deploy their new streaming service, an attempt to compete with Netflix. If this is the beginning of pattern, and we see other content providers cutting ties with Netflix, this could be a major shift in power in the distribution/rental game.

We could see Netflix stock continue to tumble all the way through the mess and the uncertainty of their ongoing digital library.

Are you at all affected by Netflix losing Starz?

Miramax has created ‘The Miramax eXperience,’ an interactive application via Facebook where you can rent films to watch directly on your computer. It’s basically like Instant Netflix but instead of a monthly or yearly fee you pay for each individual movie (about 30 Facebook credits or $3 each) and the rental is active for 30 days but the viewing window is only 48 hours once you start the movie. Seems pretty ideal huh?

But like every new invention there are a few catches. For starters, because this is such a new application there are only about 20 titles available in the U.S. right now, and even less in the U.K. and Turkey (I’m sure other locations will become available soon enough). Additionally, the custom player that you watch the films on, Ooyala, isn’t exactly the most up to date video experience. If you have stopped the movie and go back to it later it can’t tell you where you left off, something that always comes in handy for me! Also, even though you are not physically watching the film on Facebook, you are renting it from the application therefore the typical Facebook “permissions” are present asking you to post this activity to your wall and newsfeed (something I find extremely annoying and invasive about Facebook applications).

Be that as it may, I think this is overall a pretty great idea. While the service hasn’t worked out all its kinks yet, Miramax is smart to release it as soon as possible beating out the competition and being the first movie studio to get the ball rolling on this. Facebook has stated that this deal does limit them just to Miramax so I expect other studios will soon follow suit. I also enjoy the fact that it is single-film purchasing instead of a monthly fee. It’s much more financially sound that way. The application is currently live so you can check it out here: http://apps.facebook.com/miramaxapp/ and see if you’re interested!

Here’s a full list of available titles:

U.S.: Adventureland, Chicago, Clerks, Cold Mountain, Extract, From Dusk Till Dawn, Gangs of NY, Gone Baby Gone, Good Will Hunting, Jackie Brown, Kill Bill, Kill Bill 2, No Country for Old Men, Pulp Fiction, Shall We Dance (2004), Sin City, Spy Kids, Swingers, The Switch, Trainspotting

U.K.: Chicago, Cold Mountain, From Dusk Till Dawn, Good Will Hunting, Jackie Brown, Kill Bill, Kill Bill 2, Shall We Dance (2004),Sin City, Spy Kids

Turkey:  Adventureland, Chicago, Clerks, Cold Mountain, From Dusk Till Dawn,Gone Baby Gone, Good Will Hunting, Jackie Brown, Spy Kids, Swingers

What do you think Banters? Good idea or is this completely pointless?

According to Dow Jones Newswire, Netflix Inc. will expand its global reach by launching Internet streaming services in 43 countries throughout Latin America and the Caribbean later this year. Members in the new region will be able to access Netflix in Spanish, Portuguese or English.

Shares of the company, ticker NFLX, surged this morning up nearly 15 points by 10am.   This move represents a growing push into the Latin American countries by companies tied to the film industry. Cinemark, one of the worlds largest theater exhibitors, currently has its operations in 13 Latin American/South American countries including Mexico, Brazil, and Chile.  And, it was only a short year ago that movie studio Lionsgate announced that it would team up with Mexican media conglomerate Televisa to launch Pantelion Film, a partnership geared at Hispanic moviegoers in the U.S.. Pantelion is set to release a slate of eight to 10 films a year over the next five years targeted to Latino audiences.

The Latin American push is a very interesting move in the world of entertainment. Global box office sales have even been way up lately. Transformers: Dark of the Moon, though it stunk, found itself cashing in almost $400 million much to the credit of foreign sales. We need not go into details about the success of the Harry Potter’s and Avatar’s of the world.  Perhaps this represents the growing middle class abroad, an incredible thing for film companies as markets all over the world will continue to grow.

We in the US are slowly staying away from theaters as we look to cheaper sources of movie going through Netflix.  I think if you polled 5 honest studio execs they would all say Netflix is killing their business and they are having major trouble trying to identify a solution. Well, now the international market is picking up as a growing middle class abroad makes its way to theaters.  Could it stop before it even starts? What I’m trying to say is that will the Netflix push in Latin America have the same impact as it did on the US. Will the new Netflix services convince Latin Americans to stay home and stream movies to their televisions and computer screens instead of watching the big screen?

Only time will tell.

If all goes according to plan, Facebook would allow users to upload and share an array of TV shows, news, music and other types of media. As Zuckerberg stated during his presentation, “Listening to music is something that people do with their friends…Music, TV, news, books — those types of things I think people just naturally do with their friends. I hope we can play a part in enabling those new companies to get built, and companies that are out there producing this great content to become more social.” And, if executed flawlessly, Netflix would be just one of the potential companies whose partnership with Facebook would allow for both parties to “become more social.”

So there you have it, a possible Facebook/Netflix collaboration, amongst others. This seems to have the potential to be a great move on Zuckerberg’s part, and yet the only thing that keeps coming to mind is Justin Timberlake’s well-stated line (and possibly his only one throughout all of The Social Network): “A million dollars isn’t cool. You know what’s cool? A billion dollars.”

So what do you think Banterers? A interesting and creative idea from Facebook mastermind Zuckerberg? Or just another step in his attempt at world domination?