Walmart is launching a DVD-ripping service for its customers, uploading their movies to UltraViolet's cloud so that they're accessible via the big-box chain's Vudu service. The service represents a partnership between Walmart; UltraViolet, which has everyone from Sony to Warner Bros. on board; and technology entrepreneurs (Vudu was its own company before Walmart acquired it). The service will cost $2 per disc; $5 if the movies are transferred to the cloud in high definition.
DVD-ripping software is already available on the Internet for free. It's possible that charging the consumer for something already purchased is going to make him or her feel like it's not just the DVDs that are getting ripped.
Technophiles are likely to still gravitate toward the Internet for digital viewing, the easiest, cheapest and least invasive option.
Dan Rayburn has a great write-up on why this is, at the risk of editorializing slightly, a misguided idea, but it is at least an effort on the part of content publishers to show that they're aware that users hate the notion of buying movies they already own on DVD a second time so they can also have them in a digital format. The idea seems to move in the direction suggested by Warners topper Jeff Bewkes a few weeks ago, but it ignores the ease-of-use part of his rallying cry, which may have been the most important point. The whole idea smacks loudly of the gotta-have-it-on-CD changeover from about 20 years ago and people didn't like that, either—although they did do it.
Back then, however, there wasn't a massive distribution network and gray market for pirated content of identical quality to the product on offer. If there's one thing iTunes proved during the Napster years, it's that "not free" can compete with "free," but only if it's done well and with a minimum of inconvenience to the user.