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Comcast Enters the DVD-by-Mail Game

Comcast Corp. (Nasdaq: CMCSA, CMCSK) appears to be modeling itself a bit more on Netflix Inc. (Nasdaq: NFLX) after forging a relationship that allows the MSO to complement its traditional video-on-demand (VoD) offerings with a by-mail product offered in tandem with Blockbuster Inc. .

Zatz Not Funny posted details about the "DVDsByMail" promotion on Sunday. Comcast is initially marketing it under the beta label.

The Promo

A Comcast official confirmed the relationship Monday, noting that MSO customers across the country are now free to sign up for several of Blockbuster's by-mail DVD rental packages through the partnership. Comcast customers who subscribe to two or three of the MSO's service packages are in line to get a $1 discount for Blockbuster's unlimited 1-disc monthly rental tier, and a $3 discount for monthly tiers that rent out two or three DVDs or Blu-ray discs at a time. For now, the partnership doesn't include Blockbuster's "Total Access" tier, which also factors in game rentals, but the companies are talking about adding that in, too.

UPDATE: Comcast confirmed that customers who go for the DVDsByMail service are free to add games to their rental queues under the packages that are currently offered through the partnership. However, Comcast has yet to offer Total Access, a Blockbuster tier that emphasizes movie and gaming rentals by mail and allows subscribers up to five in-store exchanges during a given month.

As another component of the relationship, Blockbuster will be promoting Comcast services at stores located within the MSO's service footprint. In the early going, Comcast and Blockbuster are testing those in-store promotions in Portland, Ore., but expect to extend that to other MSO markets. Comcast estimates that 70 percent of its customers live within 10 minutes of a Blockbuster store.

At this point, Blockbuster's own broadband video service isn't included in the Comcast offering, but the deal comes into play as Comcast closes in on the 25,000 title mark for VoD (with the capacity to offer much more) via its evolving video-optimized content distribution network (CDN) and still PC-centric TV Everywhere service. With Blockbuster on board, the MSO now looks as if it's also trying to pull a Netflix by combining its streaming content with access to a catalogue of about 100,000 physical DVD titles. (See Comcast's 'Project Infinity' Takes Flight and Cable Thinking Big With Video-Focused CDNs .)

This sort of deal may also get Comcast closer to an electronic sell-through model through which subs could purchase DVDs and get access to those titles via VoD, if customers are willing to pay a premium for that privilege.

However, of the two partners, only Comcast is currently a member of UltraViolet, the new brand for the Digital Entertainment Content Ecosystem (DECE), a consortium that's developing a "digital rights locker" that will allow consumers to buy DVDs at retail and still access those titles on portable media players and cable VoD platforms. Others that are noticeably absent from the UltraViolet ranks include Apple Inc. (Nasdaq: AAPL) and Walt Disney Co. (NYSE: DIS). (See Consortium Labels Its TV Everywhere Locker.)

The Comcast deal marks the latest cable play for Blockbuster.

Last fall, the struggling video rental firm struck deals with Suddenlink Communications and Mediacom Communications Corp. . Under phase one of those deals, the MSOs were to start rebranding their VoD services under the Blockbuster brand and promote its services in local Blockbuster stores. Those deals also pave the path for Suddenlink and Mediacom to offer customers access to Blockbuster's by-mail DVD and Blu-ray rental service. (See Blockbuster Busts Out Cable Deals .)

— Jeff Baumgartner, Site Editor, Light Reading Cable

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Jeff Baumgartner 12/5/2012 | 4:27:34 PM
re: Comcast Enters the DVD-by-Mail Game

I'll try to get further clarification from Comcast, but, for now, my understanding from them is that they won't be offering Blockbuster's Total Access subscription tier, which places a higher emphasis on game rentals, but customers could add games to the queues under the other, offered packages.  But I'll double check that that is correct and eliminate some of the confusion on the game rental question.  JB


 

 

MasterBlaster 12/5/2012 | 4:27:34 PM
re: Comcast Enters the DVD-by-Mail Game

I'm not sure why all these posts are lacking the inclusion of games in the deal. A Comcast customer confimed on a similar article over at Hacking Netflix that they were able to add games to their queue when they managed it through Blockbuster's site. It doesn't appear the beta DVDsByMail site has the game information yet.

Jeff Baumgartner 12/5/2012 | 4:27:33 PM
re: Comcast Enters the DVD-by-Mail Game

Confirmed. Comcast customers who go for any of the availalbe tiers through Blockbuster can add games to their rental queue. Adjusting the story to ensure there's no confusion there. JB

MasterBlaster 12/5/2012 | 4:27:33 PM
re: Comcast Enters the DVD-by-Mail Game

Excellent thanks for the follow up!

MasterBlaster 12/5/2012 | 4:27:32 PM
re: Comcast Enters the DVD-by-Mail Game

"The games component might be a nice touch."


Actually I personally feel this is a huge understatement.


The gaming service alone is a pretty big deal seeing it alone provides the service which GameFly is providing. The addition of games to the package without extra charge raises the bar to a whole new level.


Jeff Baumgartner 12/5/2012 | 4:27:32 PM
re: Comcast Enters the DVD-by-Mail Game

This deal might help Comcast fill some content gaps since there are plenty of titles in the Blockbuster library that aren't offered on cable VoD or through the public Fancast or the Comcast TVE version of FAncast.  The games component might be a nice touch.


I've been a Netflix customer for years and have gotten much more out of the Watch Instantly service than the by-mail component, so I doubt I'll be making a switch anytime soon, or at least until I get a better chance to weigh what's good or bad between them. Anyone out there who's on board with Blockbuster's by-mail service? What do you like or hate about it? JB

joeisnuts 12/5/2012 | 4:27:32 PM
re: Comcast Enters the DVD-by-Mail Game

Please get the easy stuff right. BBI was delisted from the NYSE, and the new ticker symbol is BLOKA.PK.


Best Regards,


Joe

Jeff Baumgartner 12/5/2012 | 4:27:28 PM
re: Comcast Enters the DVD-by-Mail Game

If Comcast is looking for a differentiator againt Netflix with this deal, perhaps that's it then. JB

Jeff Baumgartner 12/5/2012 | 4:27:27 PM
re: Comcast Enters the DVD-by-Mail Game

Another item underway (expected to show up later this year): Comcast will be integrating the by-mail data from Blockbuster so customers can search for titles on the Fancast Web site and find out if it's offered on Comcast cable VoD, streaming through Fancast or Fancast Xfinity TV (the subscription TV Everywhere site), or by renting it from Blockbuster... something Comcast is calling a "universal queue."  JB


 

johnlmyers44 12/5/2012 | 4:27:02 PM
re: Comcast Enters the DVD-by-Mail Game

While this partnership makes sense for Blockbuster, it seems to be similar to the DirecTV partnerships with carriers in non-IPTV markets.... It has a relatively short shelf life.  Sooner or later, Comcast is going to acquire the content distribution 'avenue' and 'replace' Blockbuster or at the very least marginize them.


In that, I question the overall value of the partnership in the long-term.  However, based on the financial performance of Blockbuster, this is probably filed under the heading of "any port in storm"...

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