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MovieBeam shutters on-demand video service

Wed, 12/19/2007 - 8:15am
Mike Robuck

MovieBeam, which was originally backed by the Walt Disney Co., has powered down its on-demand video service as its parent company reorganizes after filing for bankruptcy.

Disney sold MovieBeam to Movie Gallery in March for less than $10 million, but MovieBeam went under despite $100 million in funding. Movie Gallery, the nation’s second-largest video rental chain, filed for bankruptcy in October.

MovieBeam sent movies over-the-air to a set-top box (STB) with an antenna, which meant it was limited to a market of 30 metropolitan areas in the U.S. The company had just 1,800 subscribers when it ceased operations

The cost of the STB was $250, along with a $30 activation fee, and movies cost anywhere from $1.99 to $3.99, with an additional charge of $1 for HD content.

According to the Associated Press, Disney began testing MovieBeam in 2003, and the list of backers included Cisco and Intel.

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