DVD Blues

Telecom results, New Coppers for Old News

It works like this: you buy a PC equipped with a DVD player and decide to check out a movie or two from the local video store. No problem - you plonk the disc in the tray and settle back to watch A Clockwork Orange. Up pops a menu that says "this is a region two disc: do you wish to play?" and you of course select OK.

So your PC switches your regional coding from region 4 (New Zealand) to region 2 and ticks off one switch against your list of five. If this was switch number five your DVD player would now be locked on region 2 and there's not a damn thing you can do about it.

This is what happened to Steve Sutcliffe in Rotorua. He bought the disc from Whitcoulls, took it home and it switched his regional setting even though the disc was labelled a region 4 disc.

Why does this matter? Well regional coding was forced on the drive manufacturers by the DVD Copy Control Association to stop nasty people like your or me seeing new movies on DVD before they come out at the cinema. We're in region 4 along with Australia and parts of Southeast Asia. All DVD players sold here are required to be set to region 4 only; however, the drive makers don't want to carry different versions of each model for the different regions, so DVD players for PCs and laptops are shipped without the regionalisation activated. Users then get five swaps before the machine locks down.

Of course, nobody tells you this when you buy the damned thing. And it doesn't help matters that the disc Sutcliffe bought was a dual-region disc that will play in either region 2 or region 4 (his Gateway PC works its way up the list of regions so when it saw region 2 it locked on). Whitcoulls has offered to refund the price of the disc but Consumers Institute head David Russell says that's probably not enough.

This isn't just happening in New Zealand, either. In Australia the ACCC is investigating claims that regionalisation is being used to inflate the price of movies in our part of the world

DVD regional coding causes Kiwi problems - IDGNet

Australia probes DVD regional coding in PC drives - NZHerald

Telecom announces financial results

While the company posted a net profit that was down 18% on last year it was at the top end of the range predicted by analysts and included a number of one-off "abnormal" payments, including writing off Australian subsidiary AAPT's CDMA rollout as well as paying off some more of the long-forgotten fibre optic/digital TV project Telecom canned years ago.

Telecom's net earnings were listed at $643 million for the year, continuing the downward trend of the last few years.

But Telecom counts its $300 million deal with Microsoft that saw XtraMSN launched in New Zealand on the other side of the ledger - as part of Telecom's "long-term debt".

Southern cross cable pay outs are also not included in that figure. SCC paid Telecom a dividend of $221 million, although Telecom does warn that next year might not be so rosy. After predicting $US50 million a year from its share of the cable company, Telecom now says a slowing in demand for bandwidth (really? how bizarre!) means less kick-back from SCC in the short term, although it is still on track to meet its targets in the longer term.

Telecom also announced Alcatel will upgrade the cable to a capacity of 240Gbit/s by the first half of 2003. Alcatel was the equipment provider for the initial build of the cable so it's no real surprise it gets the nod to upgrade the system. Hopefully the extra capacity will not only help with connection speeds from here to the US and back but will also drive down costs and mean we won't have any more embarrassing outages on the cable. What do you reckon?

Oh, and Stuff wins Most Pointless Headline of the Year award for its story below.

Telecom annual result down 18% - IDGNet

Alcatel wins $US100 million contract to upgrade cable - IDGNet

No Telecom heads roll over $215M loss - Stuff

Cable payout softens Telecom's profit slump - NZHerald

Herald thinking about charging for old news

Last week newspaper publisher INL declared it would enhance shareholder value by making customers pay to search the company archives for news stories.

Not content with merely charging for users to download the stories, Stuff will demand payment even to search the archives, making it something of a costly business. Old stories from INL's stable of papers around the country, including The Dominion, The Evening Post and Waikato Times, will all be available to readers, but only if they pay.

Now it seems the NZHerald's owner, Wilson & Horton, is also looking to this model to help make the internet pay for its keep.

Other papers already do this, of course. Consumers Institute subscribers get a discounted rate to access the archives, which is probably fair enough. Subscribers pay only $2 a month while non-subscribers do pay more. Stuff is planning to charge $1 to search and $3 to download, or users can contact the company if they plan to make regular use of the service. No price for monthly or annual subscription is included on the site.

IDGNet's owner IDG Communications has no plans to charge for archives. Publisher Bob Pinchin says he can't see why users should have to pay for access to old news.

But at least two overseas studies in recent weeks have turned on its head the old chestnut that users won't pay for content online. Cap Gemini Ernst & Young surveyed top CEOs in Australia and New Zealand and report that most think the free content model's days are numbered.

Forrester Research's report "The Content Site Turnaround" says 80% of content sites are not profitable and that the online advertising model cannot sustain most content sites.

Meanwhile in Australia The Australian has set up a service where subscribers can get the entire paper, as it appears in print, downloaded to their PC. Costs run from $US2 for weekday issues and $US3 for the weekend edition.

All this, it seems, is far from over.

NZ Herald considers charging for archives - IDGNet

INL starts charging to Knowstuff - Stuff

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