Samsung Electronics Co. (005930) and Best Buy Co. (BBY)’s CinemaNow will adopt DTS Inc.’s surround-sound technology for streaming of movies and television shows this month to provide more cinema-like audio with Web-delivered content.
Service will begin as Web-enabled Samsung TVs, coded for the DTS-HD audio, arrive in U.S. stores, Brian Towne, chief operating officer of DTS, said in an interview. More than 4,000 movies and TV shows available on CinemaNow’s service will feature the enhanced sound, he said.
DTS is seeking to tap growing home and mobile markets by providing sound that comes closer to the theater experience. It said in January that Samsung planned to adopt the streaming technology. Home-entertainment providers are increasingly competing for viewers with cinema chains, which have spent millions on digital technology, 3-D projection and advanced sound systems.
“We are facing perhaps the single biggest change in the entertainment business we have seen in the past few decades,” DTS Chief Executive Officer Jon Kirchner also said in an interview. “We feel very, very strongly there is a tremendous opportunity lying ahead.”
The technology, DTS-HD, is designed to provide more precise, immersive sound for Web-connected devices. The software can adjust delivery to meet the specifications of different devices, a feature that uses less bandwidth than other systems, Towne said.
Samsung plans to offer the technology on its Blu-ray players, he also said.
Rovi Corp. (ROVI), a provider of digital home-entertainment products, is providing the streaming technology to CinemaNow for the service.
CinemaNow, which offers movie rentals and downloads, is the first provider to adopt the system. Netflix Inc. (NFLX), one of the biggest online players, offers subscription streaming services that allow consumers to watch as many movies or television shows as they want for a fixed monthly price.
DTS is pursuing licensing agreements to offer its technology to other online movie providers as well as makers of smartphones, tablets and other devices, Kirchner said.
Online sales of digital copies of movies rose 52 percent to $231.2 million during the first quarter and digital rentals, or video-on-demand, increased 16 percent to $614.9 million, industry researcher Digital Entertainment Group said in a May 1 statement. Subscription streaming through services such as Netflix also rose, jumping 29 percent to $709.6 million.
DTS, based in Calabasas, California, was founded in 1990 to provide audio formats for cinemas and initially showcased its technology in Steven Spielberg’s 1993 hit “Jurassic Park,” according to the company’s website.
DTS fell 1.5 percent to $16.94 at the close in New York yesterday, taking its gain this year to 1.4 percent. The company reports first-quarter earnings tomorrow.
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