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In September of 1997, ZoomTV surfaced, sporting a new name and heavyduty financial backing Circuit City and the Hollywood law firm of Ziffren, Brittenham, Branca & Fischer announced the formation of Digital Video
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Express, a company that planned to release Divx, a DVD rental format, in the summer of 1998 Furious controversy burst out, with backers hailing it as an innovative approach to video rental with cheap discs you could get almost anywhere and keep for later viewings and detractors spurning it as an insidious evil scheme for greedy studios to control what you see in your own living room (Table 22) Of course, most of the detractors already owned DVD players and were annoyed that they could not play Divx discs on them Contrary to many claims, Divx was not a competing format it was a pay-per-viewing-period variation of DVD The discs were designed to be purchased from any retail outlet at a price close to rental fees The $450 purchase price covered the first viewing Once inserted into a Divxenhanced DVD player, the disc would play normally for the next 48 hours, allowing the viewer to pause, rewind, and even put in another disc before finishing the first disc Once the 48 hours were up, the owner of the disc could pay $325 to unlock it for another 48 hours Divx DVD players, which initially cost about $100 more than a regular player but later dropped to a premium of only $50, included a built-in modem so that they could call a toll-free number during the night to upload billing information Since the player only called once a month or so, it did not have to be hooked permanently to a phone line There was a DivxSilver program that allowed most discs to be converted to unlimited play for an additional fee of $20 or so The idea was to let buyers purchase a disc at low cost, try it out, and then pay full price if they liked it enough to watch repeatedly Unlimited-playback DivxGold discs were announced but never shipped Divx players were able to play regular DVD discs, but Divx discs were designed not to play in standard DVD players Each Divx disc was serialized with a bar code in the standard burst cutting area so that it could be uniquely identified and tracked by the player for billing and encryption purposes In addition to normal CSS copy protection, Divx discs used modified channel modulation (making normal drives physically incapable of reading protected data from the disc), triple DES encryption (three 56-bit keys), and watermarking of the video Ironically, the company had nothing to fear from pirates who made bit-for-bit copies, since copied discs would still require authorization and billing A pirate outfit would simply be providing free Divx replication services Actual cracking of the encryption for copying video to standard DVD discs was a potential threat, but Divx technicians claim that no one ever got through even the first layer of protection Limited trials of Divx players began June 8, 1998, in San Francisco and Richmond The only available player was from Zenith (which at the time was in 11 bankruptcy), and the promised 150 movies had dwindled to 14 The limited nationwide rollout (with one Zenith player model and 150 movies in 190 stores) began on September 25, 1998 By the end of 1998,
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TABLE 22 Pros and Cons of Divx
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Advantages of Divx I Viewing could be delayed, unlike rentals I Discs need not be returned No late fees I Movie could be watched again for a small fee Initial cost of owning a disc was reduced I Discs could be unlocked for unlimited viewing (Divx Silver), an inexpensive way to preview before deciding to purchase I Unlike rental discs, the discs were new and undamaged I The rental market was opened up to other retailers, including mail order I Studios got more control over the use of their content I Special offers received from studios in your Divx mailbox I I I Disadvantages of Divx I I Higher player cost
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Although discs did not have to be returned, the viewer still had to go to the effort of purchasing the disc Cable/satellite pay per view is more convenient Higher cost than for regular DVD rental Casual, quick viewing (looking for a name in the credits, playing a favorite scene) required paying a fee Most Divx titles did not come in widescreen format and did not include extras such as foreign language tracks, supplemental video, and commentaries The player had to be hooked to a phone line (but only once a month or after about 10 viewings) The Divx central computer ostensibly collected information about viewing habits Of course, cable/satellite pay-perview services and rental chains do the same Divx players included a mailbox for companies to send you unsolicited offers Those who did not password-protect their Divx player could receive unexpected bills when children or visitors played Divx discs Divx discs would not play in regular DVD players or DVD computers Unlocked (DivxSilver) discs only worked in players on the same account Playback in a friend s Divx player would incur a charge You could not give Divx discs as gifts unless you were sure that the recipient owned a Divx player There was little market for used Divx discs Divx players were never available outside the United States and Canada
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