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EPIX Megaplex to Compete in Online Movie Streaming Segment

EPIX Megaplex to Compete in Online Movie Streaming Segment

Look out Amazon, Netflix and Apple TV, here comes Epix Megaplex, a new streaming movie service, that’s looking to give you a run for your money.

EPIX is a new premium entertainment service that expects to launch in October 2009. It was formed as a joint venture by Viacom Inc. (NYSE: VIA and VIA.B), its Paramount Pictures unit, Metro-Goldwyn-Mayer Studios Inc. (MGM) and Lionsgate (NYSE: LGF ), and expects to offer an online streaming movie catalogue of "unmatched breadth and depth,” according to industry reports.

But it won’t be just an online service and instead has a kind of a mixed business model. In addition, it is seeking carriage as yet another premium movie channel on TV service provider platforms (cable, telco and satellite), and will compete with the likes of HBO, Showtime and Starz, especially for early access to new films. Epix CEO Mark Greenberg indicated that the company will seek a release window of 9 months after a movie’s theatrical release, which is earlier than studios release their movies to premium channels HBO and others. So competition for new movie titles at the incumbent premium channels could get a whole lot nastier with the addition of Epix to the market.

So what will this mean for consumers and online video aficionados? Well, right now Epix has very limited distribution with only one signed deal with Verizon for distribution rights over its FiOS TV service, in addition to the Internet and mobile platforms. The company does expect to have a few more distribution deals in hand by the time it launches next month, according to statements by the CEO of Viacom, one of its partner companies. So the jury is still out as to whether this service can really compete against the established online video providers in this space. And since Epix really doesn’t offer any DVD rentals per se, it’s not really a direct competitor with Netflix, except for its online streaming component.

Epix’s web-based service, Megaplex, will offer online streaming videos at the site, and the company says hopes its collection will exceed that of any other streaming video offering currently on the market.

But, unfortunately for consumers, the Epix HD online video service won’t just a standalone online streaming site. You won’t be able to go to their site, pay for and stream or download a movie directly to your PC, or as is increasingly the case, to you TV. It’ll be offered as part of a larger deal with TV service providers, so viewers will have to be a pay TV subscriber first in order to get Epix movies and shows, all of which, at least initially, will come from the Viacom, Paramount, MGM and Lionsgate libraries.

For those 2+million Verizon FiOS TV customers, however, they’ll be able to view Epix content a number of ways: by pressing an "On Demand" button located on their remote controls; selecting "VOD" in FiOS TV`s interactive media guide main menu, or by going to channel 900, which FiOS TV allocates as its VOD channel. Moreover, Epix content online will be made available to all subscribers at who provide their FiOS TV account information. It is not yet clear whether pay TV customers will have to pay an upcharge for the channel, much the way you already pay for HBO, Showtime, etc., or whether the channel will be part of the TVSPs expanded digital channel platform.

Epix execs say they’ll be able to offer much more content online with Megaplex than that of the premium TV channel. This would include access to such “value-added” content as directors` script notes, outtakes, auditions and other unique extras including trivia and games, and behind-the-scenes action and movie-making developments. Epix said that its catalogue will include many titles that have not heretofore been digitized, including crime dramas, musicals, original TV series, and music and comedy concerts.

Look for the premium service to embark on some interesting new directions with regard to the emerging area of “community” TV viewing—-providing each subscribing household with up to five accounts, which would allow them to invite up to three non-subscribers to watch the same movies simultaneously on different computers and communication via short messages for the duration of the film. Maybe not something that’d appeal to Gen-Xers or Boomers, but definitely a novel approach that could have definite appeal to Millenials.

Megaplex is set to launch sometime during the first quarter of 2010 with a ramp up to at least 3,000 titles by the second quarter of 2010. Like TiVo and Netflix, Epix will also eventually incorporate recommendations, advanced collaborative and filtering tools to the service.

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