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The Honolulu Advertiser
Posted on: Friday, November 29, 2002

Self-destructing DVDs could revolutionize movie rentals

By Ron Harris
Associated Press

SAN FRANCISCO — On a dismal, rainy day after watching Mel Gibson battle the English in "Braveheart," wouldn't it be nice to simply throw away the DVD instead of slogging the rental back to Blockbuster?

Nabil M. Lawandy, SpectraDisc president and CEO, shows his company's limited-play, time-sensitive DVDs. The three DVDs show the color change process of limited-play DVDs, from silver ready-to-play DVDs, right, to a darker blue and eventually, non-readability.

Associated Press

Technology that makes DVDs self-destruct in a few hours or days has already been developed, raising the prospect of a world without late fees.

In one recent promotion, Atlantic Records made a limited run of DVDs containing footage of the hip-hop group Nappy Roots that was viewable only for a few hours before the disc "expired."

MGM Studios used self-destructing DVDs with music videos and trailers to promote the new James Bond movie, "Die Another Day." Movie critics were told the DVD would self-destruct in 36 hours — a nod to 007's gadget-providing character Q.

And self-expiring discs also showed up at MTV's recent Latin American awards show in Miami.

But to reach consumers more broadly, any promising technology needs to make sound business sense. In an entertainment industry where profits depend in part on multiple rentals and late fees, disposable discs represent a disruptive technology, and none of the big players have endorsed it publicly.

New York-based Flexplay has yet to produce full-length movies with the technology, in which chemical changes eventually render discs unusable.

Providence, R.I.-based SpectraDisc developed similar technology and has courted most of the major studios, but none has been willing to sign a production deal.

"The decision process has been in stall mode now for at least a year and a half," said SpectraDisc chief executive Nabil Lawandy. "It's all in the hands of the content providers. They have the leverage along with distribution."

Flexplay's chief executive, Alan Blaustein, agrees the science is ready to go, even if Hollywood is not.

Another reason major studios could be wary is that Flexplay and SpectraDisc may not have resolved potential intellectual-property issues surrounding their patented technologies.

Both Flexplay and SpectraDisc add a chemical time-bomb to DVDs that begins ticking once the package is open and the discs are exposed to air.

SpectraDisc applies an outer chemical layer to the disc that begins evaporating and changing in color as the expiration time nears. Flexplay integrates its chemicals into the inner layers of the disc.

SpectraDisc DVDs turn blue. Flexplay discs also turn darker, becoming so opaque that the laser inside a DVD player no longer can read the disc.

The technology can also work on music CDs and software CD-ROMs, according to SpectraDisc, but movies are the target, since consumers generally buy music and software to keep.

At Netflix, the online movie-rental service, self-destructing DVDs would be a natural fit — customers won't have to mail back discs after watching them. Founder and CEO Reed Hastings said Netflix will use whatever DVDs Hollywood decides to produce — but he doesn't see these among them.

"A cool technology doesn't amount to a hill of beans unless the studios decide to support it," Hastings said.

None of the major moviemakers contacted by The Associated Press — Sony Pictures, Warner Bros., Vivendi Universal, MGM and The Walt Disney Co. — would comment on plans to make self-destructing movies.

If such technology were to reach the market, it could force movie-rental houses to rethink their pricing. Blockbuster collects 15 percent to 20 percent of its revenue through late fees, said Ryan Jones, an analyst for The Yankee Group.

Nonetheless, Blockbuster says it'll bite if consumers demand them — even if it means no more late fees.

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