Starz Ends Vongo Service, Focuses on Movie Download Offering with Verizon

Movie Giant Switches from Pay-Per-View to Subscription Model

Content giant Starz Entertainment LLC is planning to shut down its Vongo direct-to-consumer video service effective September 30, according to a note on a portion of its website. It said that it stopped taking on new subscribers on August 1.

Rather than continuing its subscription plus pay-per-view offering, Starz is directing Vongo users and potential customers to a subscription movie download service that it created with Verizon Communications Inc. (VZ) ─ dubbed Starz Play. The movie-owning mammoth did not give a reason for the actions.

Starz Play offers unlimited movie and video downloads across three devices, including portable media devices, for $5.99 a month.

The Starz strategy shift is a big win for triple play provider Verizon whose FiOS TV service already featured top-tier content, video-on-demand and such added features as multi-room DVR. Cableco rivals have been building VoD libraries for many years.

However, VoD systems typically give two choices: free movies and pay-per-view movies ─ which cost anywhere from $4 to $6 a title. Contrast that to the $5.99 all-you-can-eat approach with Starz Play.

Verizon, seen as leading the pack in wide deployment of very high-speed symmetric Internet access, with its FiOS 20/20 offering, is equipped to provide the bandwidth needed for movie downloads.

The change in Starz’ strategy, at least in part, raises questions as to the viability of the pay-per-view model for Internet movie download services, especially given widening availability of free movies from Hulu.com.

The venture was launched amid great fanfare by NBC Universal earlier this year. Hulu offers content free, but disables fast forwarding capability, eliminating the ability to skip ads.

Starz Play claims to offer 2,500 entertainment titles but does not include pay-per-view movies. The company adds that it has recommendations, feature titles and other functionality of Vongo. Those that sign up now get a 14-day free trial from Verizon.

Vongo customers that have downloaded pay-per-view movies will lose them via deletion, when the service concludes on Sept. 30, or at the expiration date before, whichever is first.

Users who wish to join Starz Play must first uninstall the Vongo client before accessing and downloading the new package’s software, according to the movie giant.

Related Article

Starz Power

Share this article: Email, Slashdot, Digg, Del.icio.us, Yahoo!MyWeb, Windows Live Favorites, Furl
Add this article feed to: RSS, My Yahoo, Newsgator, Bloglines