AOL, a Time Warner Inc. (TWX) company, announced that it has made a deal with four key Hollywood studios to offer video on demand on its new video service.
The four studios involved are Twentieth Century Fox, Sony Pictures Home Entertainment, Universal Pictures and Warner Bros. Home Entertainment Group. The films will be offered from $9.99 to $19.99 each.
This is a huge part of the change that AOL is going through as it moves from a subscription based service to one relying upon online ad and video content sales.
AOL said in July that they would be offering users thousands of shows, some for free, from 45 online channels. Some major networks like A&E, Comedy Central and Nickelodeon are part of the package they are offering.
Reuters reported: "Hollywood studios see digital movie downloads as a way to generate new revenue from old titles, and have invested in online movie sellers such as CinemaNow and Movielink."
The thing that AOL will need to do, as all others in this new space, is to figure a way to differentiate. Every player in this field is offering the same things, at the same price, and the same way of accessing them. What's the differentiator? Is this already a commodity before it even gets going?
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