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Curtain rising on new Divx player

The newest player will hit stores this weekend, but analysts say chances for long-term success have not improved much.

    The newest Divx player will hit stores this weekend, but analysts say chances for technology's long-term success have not improved much.

    Divx is a limited-use, pay-per-view version of the 4.7GB DVD (digital versatile disc). Priced around $5 for a rental, Divx movies are viewable only for about 48 hours after the first use unless the movie is purchased.

    Proponents say Divx offers a hassle-free viewing medium by cutting out the return trip to the video store. Critics have said that the watch-once, throw-away technology adds neither convenience nor value to DVD and causes market confusion by introducing yet another potential standard.

    Panasonic DVD-X410
    Panasonic DVD-X410

    The technology, to date available only in the test markets of San Francisco and Richmond, Virginia, was initially hampered by the relatively small number of Divx-enabled DVD players available. But this weekend, Panasonic will introduce its Divx player after recent rollouts from Thomson and Zenith.

    The Panasonic player, the DVD-X410, will retail for $549, according to Digital Video Express, which developed Divx with backing from Circuit City. It will play Divx and DVD discs.

    Industry critics say the introduction of the Panasonic player represents the fulfillment of a deal struck more than a year ago and not the arrival of a new player. In addition, more Divx manufacturers will not solve problems with the basic distribution model.

    "These guys all announced [products] a long time ago," said Van Baker, an analyst at Dataquest, noting that it costs manufacturers relatively little to cover their bets between DVD and Divx while the market emerges.

    "It's early enough that it's a no-lose proposition for [manufacturers]. They're not committed to the platform, but neutral to the platform from the beginning--they will produce and let the market decide," Baker said.

    Initially, Divx promised more exclusive movie titles than DVD video, Baker said, but the opposite has occurred. And consumers have been skeptical about promises of convenience. Consumer electronics stores where Divx titles are available generally do not keep the business hours of video stores that consumers have become accustomed to--which carry standard DVD titles.

    "If it's 10 o'clock on a Friday night and you want to rent a movie, where do you go? Consumer electronics stores can't compete with video stores in terms of hours and convenient accessibility to titles," Baker said.

    Divx players, which retail for around $150 more than DVD players, are attractive to manufacturers for their profit margins, but the risk of market confusion remains.

    "Most of us look at this and say the world does not need nor want two DVD video standards," said Jim Porter, of DiskTrend. "Divx is going to be a minor player and will eventually go away. In the meantime, the industry has become disgusted with so many standards that increase the buyers' risk and teach a whole lot of consumers to hold off and not buy anything."