RealNetworks, Inc. (NASDAQ:RNWK) should have saw this coming when they release their new controversial RealDVD software.  While RealPlayer already allows you to download any video from YouTube or powered by Flash, RealDVD allows you to rip DVDs and make back up copies.  RealDVD was officially launched today.  Six major studios announced that they are suing the software company over the software.

These studios believe that many of Netflix and Blockbuster’s customers would just burn the movies that they rent with the RealDVD software, thus causing them to lose out on a great deal of money.  The lawsuit was filed at the U.S. District Court in L.A. 

“The incentive for the consumer is obvious and all but overwhelming,” stated a request by the movie studios.  The request was for a temporary restraining order. “‘Why,’ he or she may ask, ’should I pay $18.50 to purchase a DVD when I can rent it for $3.25 and make a permanent copy?’”

RealNetworks defends their software by saying it is legal.  RealDVD is sold for $30 per consumer at $20 for up to four licenses after that.  The software copy is locked into the original owner’s hard drive and does not alter the encryption technology used by movie studios already.  Copying one’s own personal copies of a DVD is “fair use” by law. 

The movie studios stated that RealDVD violates the Digital Millenium Copyright Act to bypass technologies that prevent the copying of a DVD without permission of the copyright owners.  The movie studios that are suing RealNetworks includes Viacom, Inc. (NYSE:VIA)’s Paramount Pictures, Sony Corporation (NYSE:SNE)’s Sony Pictures, News Corporation (NYSE:NWS.A)’s 20th Century Fox, General Electric (NYSE:GE)’s Universal, The Walt Disney Company (NYSE:DIS) studio, and Time Warner Inc. (NYSE:TWX) Warner Bros.

Netflix, Inc. (NASDAQ:NFLX) has made a deal with CBS Corporation (NYSE:CBS) and The Walt Disney Company (NYSE:DIS).  The agreement is that Netflix members will be able to watch shows appearing on Disney and CBS the day after they air on TV.  This means if you are a fan of How I Met Your Mother or Hannah Montana and you have access to a Netflix account, you are in luck.  Even though many of the shows already appear on sites like Hulu and CBS.com itself, many of the shows on that site arrive days after the show originally airs. 

The effort by Netflix to make these deals indicates the pressure that the DVD market is in when competing directly against downloads.  Amazon.com recently created a new video site.  The sales of movies on iTunes is increasing at a rapid pace.  And Hulu and Joost are rapidly adding free video content. 

Those paying for monthly subscriptions on Netflix at $8.99 can already play select TV shows and movies at no additional charge.  This move alone was made in order to compete with Blockbuster’s DVD mail order in-store return strength.  Netflix hosts about 12,000 videos to watch online.  “With deals like CBS and Disney, we’re giving subscribers additional reasons to try it,” stated Ted Sarandos, chief content office of Netflix. 

The Club Penguin Times is an online newsletter that covers the ongoing world of fictitious penguins. The L.A. Times mentioned that The Club Penguin Times has more circulation than New York Daily News, the Chicago Tribune, and the Dallas Morning News. There are about 6.7 million monthly readers.

Club Penguin was bought out by Disney about a year ago. The Club Penguin Times has social networking and user-submitted content. The Club Penguin Times has about 30,000 daily submissions from kids that are ages 6-14. Club Penguin has about 12 million members.

“We try to figure out how can we answer the most questions by choosing
a handful,” stated Lane Merrifield, co-founder of Club Penguin in regards to which submissions are to be published. Merrifeld is also the head of virtual worlds development at Walt Disney’s Interactive
Media Group.

Related Link:
1. The L.A. Times
2. Club Penguin

The Walt Disney Company (NYSE:DIS) division of Disney.com has just pulled a Hulu.  Disney.com announced today that they will be streaming movies from their Wonderful World of Disney selections.  First the films will air on ABC on Saturday nights and then they will appear on Disney.com for a specific amount of time.

The quality is pretty good, but I didn’t see any full-screen options.  There is a way to make the screen big, smallest, and smaller.

“Streaming full-length films on Disney.com takes our commitment to delivering world-class online entertainment to the next level,” said Paul Yanover, EVP and MD of Disney Online. “This is a wonderful partnership with ABC, and just another example of how Disney’s unmatched, high-quality content can be leveraged on multiple platforms.”

Below is the schedule of the movies:

• “Finding Nemo” – currently available online through June 13
• “Monsters Inc.” – airs on ABC Saturday, June 14 at 8pm; available on Disney.com June 16-20
• “Haunted Mansion” – airs on ABC Saturday, June 28 at 8pm; available on Disney.com June 30-July 4
• “Confessions of a Teenage Drama Queen” – airs on ABC Saturday, July 5 at 8pm; available on Disney.com July 7-11
• “Princess Diaries 2” – airs on ABC Saturday, July 12 at 8pm; available on Disney.com July 14-18
• “Freaky Friday” – airs on ABC Saturday, July 19 at 8pm; available on Disney.com July 21-25
• “Peter Pan” – airs on ABC Saturday, Aug. 2 at 8pm; available on Disney.com Aug. 4

On Monday June 23, Disney will also play Camp Rock after it premieres June 20 on ABC.

Below is a screen shot of what Finding Nemo looks like in a big size:

The Google Earth division of Google Inc. (NASDAQ:GOOG) has just introduced a new way to walk through Disney World.  Except in this case, it is on Google Earth.  Google Earth users can now walk through a 3D version of Disney World by typing in Disney World in Orlando, Florida and clicking Fly To. 

“Last May, Eric Schmidt and I met to talk about The Walt Disney Company’s focus on technology,” stated Jay Rasulo, Chairman of Walt Disney Parks and Resorts on the Official Google Blog. “We started to explore innovative ways we could work together to bring one of the world’s most magical destinations to Google Earth’s millions of users… and how our guests could be a mouse-click away from visiting the place where dreams come true.”

Disney World is part of the 3D Building layer in Google Earth.  Under Gallery-> Travel and Tourism -> Walt Disney World, there is another layer that has audio, video, and facts about the park.  Below is a video demo:
[youtube]http://www.youtube.com/watch?v=_wmdCeFUQH4[/youtube]

The Walt Disney Company (NYSE:DIS) is makin’ moves online.  In August 2007, the Mickey Mouse and “It’s a small world” creators acquired Club Penguin, a kid-friendly social network for $350 million.  And now the company announced that they will be creating virtual worlds with online games.  As a matter of fact, they hired a team to focus on these specific jobs.  This new team will be part of the Walt Disney Internet Group and will be called Disney Online Studios.

Disney Online Studios will be managed by Steve Parkis.  Parkis studied at Michigan State and Northwestern and then started his career working at Kimberly-Clark.  AFter that, Parkis became a MD at Windhorst New Technologies.  Today Steve serves as the Vice President of Premium Products for Disney Online.

The new Disney Online Studios team will also include Disney Online’s Virtual Reality Studio, Toontown Online, and Pirates of the Caribbean Online.  Disney is also creating a virtual world where kids can control Disney Fairies and characters from the Disney film, Cars.  Club Penguin will continue to report to the Walt Disney Internet Group.

Disney is taking over the market-share for virtual worlds made for children, a market that Linden Lab, creator of Second Life, could have easily done.  Second Life had about 1.3 million users log in around March 2007 [clickz].  I’m not sure what the current number of users are.

[Information Source:  socalTECH]

“Club Penguin embodies principles that are of the utmost importance to Disney — providing high-quality family entertainment and fostering parental trust,” stated Bob Iger, the President and CEO of Disney. “The founders have woven together new technologies and creativity to build an incredibly compelling, immersive entertainment experience for kids and families.”

The last time I wrote about Club Penguin was May 16, 2007. It was in regards to Sony pursuing a potential acquisition of Club Penguin for $450 million. However, The Walt Disney Company (NYSE:DIS) announced today that they have acquired Club Penguin for $350 million.

The biggest benefit of Club Penguin is that it is a safe social network for children and is heavily regulated. “We have been actively searching for an organization that not only shares our values and concerns for children, but also has the ability and desire to help us bring Club Penguin to more children throughout the world,” stated Lane Merrifield, one of Club Penguin’s co-founder. “We’ve found that partner in Disney.”

Disney does not seem to want to change Club Penguin’s operations as far as making the founders relocate from Kelowna, Canada. But I would not be surprised if Disney starts integrating some of their trademark characters into the system, especially during peak blockbuster release seasons. There is a Welcome Club Penguin message on the Disney homepage already: http://home.disney.go.com/index

References:
[1] Associated Press (via Yahoo!): Disney acquires Club Penguin for $350M
[2] Pulse 2.0: Sony Advances Talks With ClubPenguin For Potential $450 Million Acquisition

56.com[1], a Chinese video start-up company has raised $10 million in funding from Steamboat Ventures.  Steamboat is the funding company subsidiary of The Wall Disney Company.  56.com will use the funding to upgrade hardware, add new features, and increase marketing efforts.  Steamboat Ventures previously invested in UUsee.com, a Chinese P2P video website.  The funding provided to 56.com and UUsee.com validates Steamboat’s interest in Chinese video companies.

Another interesting effort made by The Walt Disney Company is the efforts that they are making in video fingerprint.  Disney and YouTube are teaming up to develop tools that are used to identify certain attributes in video clips.  “The technology was built with the Disney’s and Time Warner’s in mind,” stated Chris Maxcy, a YouTube VP of Development.

[1] 56.com