Twentieth Century Fox will start to sell movies including "X-Men: The Last Stand" and TV shows like "24" from websites owned by parent News Corp. in the company's first step in the online movie market.
Fox Interactive Media said it will begin to sell movies and shows on the Direct2Drive download site, owned by Fox's IGN Entertainment, by October. The programs can be viewed on personal computers as well as Windows portable media devices.
The programs will be made available for purchase from News Corp.'s popular online teen hangout MySpace.com shortly thereafter, Fox Interactive Media president Ross Levinsohn said in an interview.
Twentieth Century Fox now sells its films to download services like CinemaNow and Movielink, but it has not invested in the websites, unlike other studios including Walt Disney Co., Viacom Inc.'s Paramount Pictures and Time Warner Inc.'s Warner Brothers.
The new project is an early indicator of News Corp. Chief Executive Rupert Murdoch's ambitions to exploit Direct2Drive's technology in the fledgling movie download market, said one analyst.
"It's an infrastructure that they use to deliver gaming software that can be a horizontal platform," Gartner research director Allen Weiner, who was briefed on the announcement, said. "It doesn't matter what facade you put in front of it."
Direct2Drive, a digital media distribution system, has been contracted by other companies to build Internet media store fronts, and could some day serve as the underlying technology behind other video stores on Fox Interactive Media properties, including FoxSports.com, Weiner said.
Fox Interactive Media could also hypothetically court other movie and TV studios to sell program on its web properties, potentially competing with the download services offered by other Hollywood studios.
Levinsohn was coy about future plans, but said: "The more we can diversify, the more it bodes well for our business." Murdoch has time and again fostered collaboration among News Corp.'s myriad divisions, accomplishing what other media conglomerates have often attempted but often fail to do. After buying a controlling stake in top U.S. satellite TV operator DirecTV Group Inc., for instance, the News Corp.-controlled NDS Group edged out TiVo Inc. as DirecTV's top supplier for digital video recorders.
In contrast, the world's largest media company Time Warner has rarely been able to get its units working together, most notably with its AOL online unit.
The move comes a week after MySpace selected Google Inc. as its search advertising partner in a deal that guarantees to pay Fox Interactive Media at least $900 million.
Movies will sell for about $20 and shows for $1.99 and will be playable on portable entertainment devices that employ Microsoft Corp.'s copy protection system.
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