Fox to announce video-on-demand deal

Copyright 2002 / Los Angeles Times
Los Angeles Times...05/06/2002
From LexisNexis

By Jon Healey
from BroadbandWeek Direct, May 6, 2002

Ten days after pulling the plug on its video-on-demand joint venture with Walt Disney Corp., News Corp.'s 20th Century Fox is expected to announce a long-term deal with In Demand to offer Fox movies through cable TV video-on-demand services.

Financial terms of the deal were not disclosed, but Fox is believed to have won a better share of the proceeds from video-on-demand sales than it receives from pay-per-view movies--60 percent instead of 50 percent.

The joint venture, Movies.com, was formed in part to strike video-on-demand deals with cable operators on better terms than the companies were getting for pay-per-view.

But the venture and a competing offering from five other major Hollywood studios drew the attention of the Department of Justice, which launched an antitrust investigation.

In Demand, which is owned by four top cable companies, also has video-on-demand agreements with studios owned by Vivendi Universal, Sony Corp., DreamWorks SKG and Artisan Entertainment.

About 3 million cable customers have access to movies on demand, but the number is expected to rise rapidly this year as more cable systems add the service.