Box office delivered

AS MOVIE PIRACY proliferates and downloading entertainment from the `net heads towards becoming the norm, a Johannesburg-based business is boldly punting a subscription service that delivers DVDs to people`s homes.

PushPlay, launched in October 2006, is a service that rents out DVDs to consumers at a fixed monthly subscription fee. Viewers sign up with the service, book their DVDs online, and PushPlay mails them to the subscriber`s post box. Once the movies have been watched, they are placed in one of PushPlay`s drop boxes at Spars, Vida e Caffe coffee shops and selected BP forecourts, and a fresh entertainment order can be placed.

Viewers can also select a lengthy list of DVDs, so that once the movies they have watched are back with PushPlay, a new order is dispatched automatically. The monthly subscription fee ranges from R59 to R209, and allows for unlimited numbers of movies. Subscribers can keep the movies for as long as they like, without incurring a fine.

The service was launched by entrepreneurs Darren McLean and Debora Wynne, who say they saw the benefits of online DVD rental services overseas a few years ago. The two say they have spent the past two years "developing proprietary intellectual property necessary to operate the business, navigating the conceptualisation, piloting and launch phases, and building key capabilities and assets that are easily scalable to support our growth strategy."

Among other things, the development stages saw them acquiring a highly interactive and searchable website, setting up a delivery and collection plan and acquiring the 60 000 DVDs the service now offers.

"Given the increased proliferation of home entertainment systems, it made sense to offer a DVD rental service that is cheap, fast and accessible, with a massive selection," says McLean.

Offering unlimited movies and actually posting DVDs to users may not seem the most cost-effective way to distribute entertainment, but the PushPlay team says the model is working.

"By using the national postal service for our distribution and by being able to service the country via three warehouses, we benefit from economies of scale," they say.  "For this reason a franchise model for this concept would not allow the service to reach economies of scale and realise profits. In addition to this, advertising revenues are also built into the model, allowing us to offer competitive and affordable subscription fees to our members."

It seems the model works for consumers too. The service currently has 10 000 subscribers, 2 000 of whom are active renters. The other 8 000, says PushPlay, are waiting for a drop box in their area, do not have credit cards or just use the site to browse or review movies.

PushPlay says it is about to embark on a phase of accelerated growth for both its DVD rental service and its new entertainment social networking platform. The social networking platform, set to launch in January next year, will allow members to rate, review and share their viewing preferences as well as interact with other members. The company has also launched a gift voucher system ahead of Christmas, aiming to cash in on the holiday shopping season.