War of the grocers hotting up as Sainsbury’s preps new video service

UK supermarket giant Sainsbury’s will be launching a new over-the-top (OTT) video service later this year, based on technology from US firm Rovi and offering access to an extensive library of film and TV entertainment, including new releases often on the same day as their DVD/Blu-ray release.

The service will initially be made available online at Sainsbury’s Entertainment and then expanded to offer access through a range of Internet-connected devices including Smart TVs, Blu-ray Disc players, smartphones, and game consoles.

While no content partners have yet been announced, the involvement of Rovi (formerly known as Macrovision) suggests that many of the major US film studios will be on board, thanks to Rovi’s strong standing in the areas of content protection, middleware and interactive programming guides.

Luke Jensen, Group Development Director at Sainsbury’s comments: “On-demand streaming video is an exciting addition to our existing online offerings, and supports our customers as they progress from consuming content on physical disc to accessing their favourite entertainment on a range of devices, where and when they choose.”

Sainsbury’s is one of the largest retailers in the UK, operating over 1,000 stores nationwide with annual revenues in excess of GB£ 24bn (US$ 38bn). It will be playing catch-up however: rival retailer Tesco bought a majority (80%) stake in established online video service Blinkbox last year for an undisclosed amount, and now counts a catalogue of over 9,000 films and around 2mn users.

UK retailers are increasingly looking to entering the online entertainment industry as a way of expanding their product range and learning even more about their customers – setting the stage for a clash with the UK’s established pay-TV heavyweights (BSkyB and Virgin Media) as well as direct competitors such as LoveFilm (owned entirely by online retailer Amazon) and Netflix.

Rovi received a big fillip recently by winning a multi-year contract with search giant Google which will see its interactive programme guide used in the latter’s Fiber TV service which launched in Kansas City recently, including on set-top boxes, mobile devices, and on the Web.

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