With what they call a third round of funding as they prepare for the winter holiday season, DiVX thinks they can move 20 million MPEG 4-based digital encoding devices by Christmas – meaning another 18 million on top of the 2 million they have already sold, the company said at the end of July.
DiVX has been working for three years toward a situation where CE makers bundle DiVX codecs into equipment sold retail, according to a few published reports, with DiVX touting its codec's ability to encode video three times faster than Microsoft's VC9 and produce files with 30 percent better visual quality.
Libero.it in Italy is the latest portal to engage DiVX codec packaging – encoding services, compression software, digital rights management – and are using it to launch a 4,000-item video library to its estimated 8 million customers, said one report.
DiVX may also be hoping the Libero deal, plus its Christmas delivery performance, will help shake what reports call its image as a "slightly seedy" startup, whose earliest releases were predominantly adult entertainment, anime, or extreme sports, "whatever content it could get in the early days," said one report. Libero, however, deals mostly in Italian content, like television programs and indigenous films blended with a few American films. DiVX will encode a reported 4 thousand items for Libero, though charges have yet to be announced.
"We've been working on this for three years," said DiVX spokesman Tom Huntington to the London Register about the Libero deal. "We went to the (Motion Picture Association of America) and they made it clear to us that they would not look at us until we had 10 million customers and that they were not interested in a system that involved a PC. They also helped us with our Digital Rights Management scheme that we built ourselves. So we've been quietly going about our business: first selling the codec to work in software; then we interested a few smaller consumer electronics firms to bundle in our codecs; then some of the integrated circuit manufacturers put it into silicon; and now the major CE firms are virtually all coming out with products between now and Christmas."
DiVX touts its file sizes as seven to 10 times smaller than those on DVD discs, with a two-hour DiVX-encoded film downloadable on half a megabit broadband line in less than 45 minutes, with users able, through progressive downloading (getting enough for the rest to download while you watch the movie), to see films in full-screen, high-quality format within minutes of starting a download, according to one of the reports.
Huntington said DiVX had to write their own digital rights management software, "which works by first registering each CE device online and uses our remote servers to store encryption keys and permissions. Once a piece of content has been given permission to play on a registered player, they no longer have to be online; but the first time it is played, it needs to connect. But we make that process completely seamless for the customer."
Their system, he continued, can go from there to support multiple models such as five-day rentals or set views, and even outright purchases. Whether the major film studios translate that into releasing content for DiVX-tended delivery, however, is yet to be seen, even if DiVX is optimistic. "It's been a long process," Huntington told the Register, "but we think that the major studios are about to give us access."
