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Saturday, November 11, 2006

Weekend Edition: Telecom Goes To The Movies

It is not enough that companies like Verizon and AT&T are cutting deals with studios, TV networks, and even YouTube to get programming for their fiber-to-the-home IPTV initiatives. The deals may end up being lucrative for the studios who are stuggling with their mix of distribution that includes theaters, DVDs, and airplane movies. The list get longer.

Money from downloading films over the internet may end up being a big business and will be critical to telecoms war with cable to own the pipe to the home.

But, why should the content guys take little risk and get all the money.

That's what France Telecom want to know. Their answer is to start their own production operation and invest in content themselves. The company has already started a large division to buy exclusive content for its customer, but that does not seem to be enough. France Telecom plans to invest in 10 to 15 movies a year.

The move may have a ripple affect in the US. Studios often take on private partners to spread the risk of high budget films. There is no reason that those partners could not be Verizon or AT&T. This move might give them an earlier window to show the programming, a flanking move against the cable companies.

Of course, the cable companies might want to get into the act themselves.

Being in the studio business may not be so tough after all.

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