Cable Operators

Sears, Kmart Debut Over-the-Top Movie Service

1/03/2011 12:01 AM Eastern

Sears and Kmart are the latest
over-the-top threats to pay TV providers’
video-on-demand businesses.

Sears last week officially launched its
online movie-download service, Alphaline
Entertainment, which will let Sears
and Kmart customers rent or purchase
movies, including on the same day they
are released on DVD and Blu-ray Disc,
provided through digital media services
firm Sonic Solutions.

Titles currently available to rent or buy
from Alphaline include The Town, Inception,
Resident Evil: Afterlife
, Easy A, Salt and Legend
of the Guardians
. TV shows available to
download-to-own include Mad Men, The
Closer
and Nurse Jackie.

Under Sonic’s multiyear agreement with
Sears, the companies will provide access to
Alphaline services through multiple devices
including Blu-ray Disc players, HDTVs, portable
media players and mobile phones.

“Collaborating with Sonic provides a
great opportunity for Sears and Kmart to
launch digital services for customers seeking
even faster access to the latest in home
entertainment experiences,” Karen Austin,
president of consumer electronics for Sears
and Kmart, said in a statement. “We’ll
continue to increase the reach and flexibility
of the Alphaline Entertainment service
by providing consumers on-demand
access to the latest entertainment from a
range of home and mobile electronics.”

Sears, which merged with Kmart in 2005,
is the fourth largest retailer in the U.S. The
company has about 3,900 department stores
and specialty retail stores in the U.S. and
Canada.
Separately, Rovi announced plans to acquire
Sonic Solutions for $720 million in
stock and cash.

Best Buy also is a Sonic customer, and
the electronics retailer offers downloads
through the CinemaNow brand. Sonic
has distribution agreements with each of
the major Hollywood studios, including
The Walt Disney Co., Paramount Pictures,
Warner Bros., Universal Pictures, 20th
Century Fox, Sony Pictures Entertainment
and Lionsgate.

Meanwhile, Wal-Mart Stores — the biggest
U.S. retailer — earlier this year acquired
Vudu, which provides HD movies
for rent or purchase through various
consumer-electronics devices.

September