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Best Buy-CinemaNow announcement leaves more questions than answers

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As you likely have heard, Best Buy made a big splash this week with the announcement that they would be packaging Roxio’s CinemaNow service into virtually all video devices it sells that have online capabilities. CinemaNow is a service that allows people to rent or buy movies online and stream them to connected devices.

This isn’t the first partnership for CinemaNow, which has agreements with TiVo, LG, and Archos to name a few. CinemaNow is also the backend that’s running Blockbuster’s On Demand service.

And it isn’t the first partnership for Best Buy in the streaming video playground either, as the retailer just a few weeks ago announced it had partnered with Netflix to add its instant streaming service to all Insignia brand Blu-ray players.

And while details continue to leak out, the initial announcement left me with more questions than answers, and several reports I’ve read have contradicted each other.

What devices?

An early AP report stated that CinemaNow software would be “included on all the Web-connected devices sold in Best Buy’s more than 1,000 U.S. stores.” But as Engadget pointed out that has to be a mistake, since the iPhone is sold at Best Buy and it’s not likely that Apple will be opening the doors to CinemaNow anytime soon.

The official press release indicates “Best Buy intends to embed the Roxio CinemaNow technology on a wide array of devices – web-connected television sets, portable media players, PCs, Blu-ray Disc players, set-top boxes, and mobile phones – from a variety of manufacturers.” That tells me that while not every item in the store will be part of the partnership, it will make its way onto more than just Best Buy brand devices.

Then comes this report from Best Buy’s hometown paper, the Minneapolis Star Tribune: “The movie technology will be embedded in Best Buy’s private-label Insignia brand TVs and Blu-ray players. Best Buy spokesman Scott Morris said the company is in talks with manufacturers such as Samsung, Sony, Panasonic and Toshiba to add it to their devices.”

That makes it sound like the only partner lined up currently is Best Buy.

How Much?

Confusion also reigns on how the service will actually work. This report on High Def Digest and other like it indicate that Best Buy will somehow tie in-store purchases to their digital equivalent. According to HDD, “Best Buy’s Chris Homeister has the answers. ‘We’re going into this business in a big way,’ he states. ‘The idea is to let consumers pay once for a DVD and then eventually be able to play it on any device.’ This would mean, essentially, that a DVD purchase from Best Buy or BestBuy.com would translate into digital rights for the same content.”

But to go back and read the Star Tribune report and this one from Video Business and it sounds like it’s a pay to play service. From Video Business: “Best Buy customers will be able to rent digital titles for between $1 and $4 while pricing for purchased titles will be determined by Best Buy but will likely be comparable to DVD sell-through prices, Sonic Solutions Chief Executive Officer Dave Habiger said on a conference call with analysts.”

It seems to me the only thing that is for sure is that it’s coming in 2010.

It’s obvious digital distribution is a roaring freight train, barreling down the tracks at us regardless of if we want it or not. The problem is, the state of broadband in the U.S. leads me to believe the train will run out of track before it reaches the station.

As discussed before on Seen in HD, neither myself or my co-host have been able to watch an entire show in HD on the Netflix streaming service from our Xbox 360s. We both also tested the new service from EpixHD, and neither of us were able to sustain even the 3000kbs needed to achieve that service’s highest video quality.

Last night, for several hours my Comcast broadband connection averaged less than 2Mbs, not even good enough to stream Hulu content. Pardon me for stating the obvious, but how in the world am I supposed to count on online delivery of my movies and television content when a 18.5mb file like Media Mall’s Play On software takes me 12 minutes to download?

This announcement is exciting for Best Buy and Sonic, the parent company of CinemaNow. It’s also an example that retailers are starting to realize that making customers pay for DVD, Blu-ray, portable, iPod, and streaming versions of the same content is unacceptable.

At the end of the day, however, there’s a lot of holes that need to be filled in before we know if this is a game changing partnership or simply another in what is sure to be an unending stream of digital partnership announcements.

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