Best Buy In Talks for New Digital Film Service

Best Buy is already feeling the transition from disc-based content to digital, and is in talks with a third-party partner on a digital distribution service that could pop up as early as this summer. Patnering with CinemaNow would allow Best Buy to extend their service on to set-tops as well. Dig it:

The chain is in talks with CinemaNow and other online movie services to create a download business that Best Buy hopes will offset falling DVD sales, studio execs said.

Details on how exactly Best Buy would benefit from a potential partnership with CinemaNow, and others, are still being finalized. But one possibility, according to studio execs, is that Best Buy would market and sell Web-enabled hardware devices—from TVs to Blu-ray Disc players—that would include immediate, built-in access to CinemaNow’s library. Such devices could roll out as soon as this summer. Best Buy would presumably share with CinemaNow or another third-party provider the resulting download and/or streaming revenue.

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The strategy is similar to what Blockbuster and online disc retailers Amazon and Netflix have done over the last year. Blockbuster partnered with CinemaNow in January to offer movie downloads through a variety of set-top devices including TiVo digital video recorders and Blu-ray players. The partnered service is set to debut in the second half of the year. Amazon offers its Video on Demand service through TiVo and Roku players, and Netflix offers its instant viewing service on those devices and others.

Add another player in the already over-crowded VOD game. It will be hard for Best Buy to gain footing against iTunes, Amazon, and Netflix who have been playing the game a bit longer. Then again, the alternative would be to continue trying to push plastic discs. Full story on Video Business.