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Disney hoping to sell MovieBeam

Mothballed movie service hasn't found an investor yet, and Disney says it won't make its money back.

Disney is trying to shed most of its interest in the ambitious over-the-air MovieBeam video-on-demand service that it shut down last spring, according to a recent federal securities filing.

The company announced in April that the service was being temporarily interrupted in the three cities where it was being tested, but that it would ultimately be restored after an "upgrade."

In financial documents filed last month, the company said that it is still seeking to refinance the business, and ultimately hoped to relinquish most of its interest, however. The company said it had concluded that the refinancing would not be enough to cover its investment in MovieBeam.

"If successful, a refinancing transaction will result in the company making a further investment in the business while retaining only a minority interest in MovieBeam," the financial documents said.

A Disney spokeswoman could not be reached for comment on the issue.

The MovieBeam service was the most high-profile of several experiments taking advantage of unused portions of the television airwaves to beam content to homes.

In Disney's case, subscribers would pay $8.99 a month to rent a device that would periodically be automatically refilled with up to 100 movies that could be watched any time for about the price of renting a movie. The service was operating until April in Jacksonville, Fla.; Spokane, Wash.; and Salt Lake City.

The company said in its filing that recent negotiations with a financial investor had persuaded it that it would not recover its investment in MovieBeam, and that it had decided to take a $24 million charge related to the service in the third fiscal quarter of 2005.

The company's plans were reported by the Web site.