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DivX courting studios with new tech

With DivX 6's compression technology and a couple high-profile deals, the company hopes to woo Hollywood.

LAS VEGAS--DivXNetworks, the bad boy of Internet video, has signed two major deals and is showing off technology that could allow a studio to sell movies over the Internet.

The company on Thursday also previewed DivX 6, an upcoming version of its compression technology, which will allow consumers or film studios to fit an entire high-definition film on a standard DVD disc. DivX 6, which comes out in March, will appear in DVD players selling for about $100 later in the year.

At the Consumer Electronics Show, the San Diego-based company announced that Apex Digital will include DivX's compression technology on all of its consumer DVD players sold in the United States. Although Apex is hardly a household name, the company has become one of the largest sellers of DVD players, with low-price units available in stores like Target. Apex has also branched into DVD recorders.

Apex has included the company's software on one portable DVD player, but not the home models, DivX Technology Architect Eric Grab said.

Also on Thursday, DivX announced that Samsung Ventures America has placed an unspecified venture investment with the company.

DivX's compression technology competes against software from Microsoft and other large companies. Currently, 40 percent of DVD players sold in Europe come loaded with DivX software, Chief Operating Officer Kevin Hell said. The company claims that 20 million DVD players and 160 million PCs worldwide contain the software. (Hardware makers pay a fee to DivX for loading the software.)

More recently, the company has been courting movie studios and content providers to adopt the technology for optical disks or online sales projects such as download-to-own services. Company President Shani Ghanem said in October that the company's technology would appear in a video-on-demand service in the first half of 2005, but Hell said nothing can yet be announced.

"We have no studio deals yet, but we are optimistic," Hell said. In the early part of the decade, the company drew the wrath of film studios, which said the company's products enabled illicit video swapping.

DivX 6, however, will ideally help the company land studio deals. DivX 6 does a better job of compression than the current DivX 5, Hell said. An entire high-definition movie can fit onto a standard red-laser DVD disc, he said. Ordinarily, a high-definition movie would require several discs. Close to eight standard movies can fit on a regular DVD disc when compressed through DivX 6.

DivX 6 also includes the ability for home users or content providers to insert subtitles, previews or command menus into video. In this way, home movies can look more like a standard DVD, and a pay-per-view movie can come with features now found on DVD movies.

Another coming technology, DivX Connect, will enable a PC to shuttle DivX-compressed files to a DVD player. Potentially, this will allow studios to send a movie down a broadband pipe to a PC. The user can then burn the movie to a DVD disc or CD and then play it on the DVD player.