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After Cutbacks, Vudu Accelerates Plan to OEM its Video-on-Demand Software

Vudu co-founder Tony Miranz says, "We are going to try to piggyback on TVs, DVD players and other classes of devices," but the company will still serve retail and custom channels


Last December, Vudu began to offer streaming content beyond its own movie downloads.

Vudu, maker of IP-based video-on-demand solutions, has endured another round of layoffs. Founded in 2004, the company has had as many as 110 or so employees and is now down to about 50, according to co-founder Tony Miranz.

"We plan to keep that steady," Miranz says.

These days, everyone is down-sizing, so the Vudu layoffs might not be a big deal.

But it's more significant than the Microsoft or Bose layoffs, for example, because Vudu has yet to firmly seed itself in the marketplace.

At the rate its been spending, the company would need a capital infusion sooner rather than later. "Sooner," of course, is a bad time to be raising money.

The operational changes, Miranz says, will allow Vudu to "extend the runway to get more capital."

Vudu Accelerates OEM Plans

So it looks like Vudu will have to fast-track its OEM software model. We all knew that Vudu wasn't in the box-making business. "We're a software company first and foremost," Miranz says.

As any pure-play software vendor will tell you, though, you gotta make the boxes to prove the concept. "We've done that," Miranz says.

He says that Vudu is not exiting the retail or custom channels.

"Another generation is coming" for the retail market, according to Miranz. The barebones Vudu box retails for $299, but Best Buy always seems to be running some kind of promotion on it. Miranz says that an even lower cost product is in the pipeline.

On the custom side, Miranz says, "Our commitment to the CEDIA [custom electronics] market remains. We will continue to build for and innovate for that channel."

Vudu's most recent innovation for the channel is the XL2 box ($1,300), featuring a rack-mount form factor and much more integration options than the consumer product.

Back in November, Vudu national channel manager Mark Donnigan said the company had signed up more than 1,000 integrators, which of course is no indication of the sell-through in the channel.

So while Miranz says Vudu will still sell boxes, the company is "counting on other platforms to get us propagated. … We are going to try to piggyback on TVs, DVD players and other classes of devices."

The CE vendors, he adds, are lining up at Vudu's doors: "Right now, we're getting bombarded with inquiries. … Our job right now really is to pick and choose partners that we want to work with."

Does Vudu have the Steam?

When Vudu launched its IP-based VoD solution three years ago, the pickin's were still pretty slim.

But overnight, it seems, the studios have freed up their content, and dozens of new players – veterans and startups alike – are delivering viable options for video on demand.

Windows 7 Media Center promises a wealth of easy-to-find on-demand content.

Then there's cable, Hulu, Apple TV, Blockbuster, HDGiants, Amazon, Netflix, Digeo, Tivo and the plethora of CE devices that can stream from these and other providers.

Can Vudu compete with those juggernauts?

"At the end of the day, we are the premium play in the market," says Donnigan. "No one has challenged us there. So, is there room for a premium play?"

Vudu is banking on it.

The company still may be the only on-demand provider of 1080p/24 resolutions over IP.

Currently Vudu offers 1,300 titles natively encoded in 1080p HD.

Another plus for Vudu is its elegant user interface – but how long can the company sustain that advantage?

Miranz claims that Vudu is the only "high-grade, over-the-top" IP media streamer with "near-Blu-ray quality, high reliability and a phenomenal user experience."

For that reason, he says, "We have the highest RPU [revenue per user] of any video-on-demand in the industry … by orders of magnitude. The better the user interface, the higher the revenue per box."

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Article Topics

News · Product News · Digital Media · Media Servers · Media Server · All topics

About the Author

Julie Jacobson, Co-Founder, EH Publishing / Editor-at-large, CE Pro
Julie Jacobson, recipient of the 2014 CEA TechHome Leadership Award, is co-founder of EH Publishing, producer of CE Pro, Electronic House, Commercial Integrator, Security Sales and other leading technology publications. She currently spends most of her time writing for CE Pro in the areas of home automation, security, networked A/V and the business of home systems integration. Julie majored in Economics at the University of Michigan, spent a year abroad at Cambridge University, earned an MBA from the University of Texas at Austin, and has never taken a journalism class in her life. She's a washed-up Ultimate Frisbee player currently residing in Carlsbad, Calif. Follow her on Twitter @juliejacobson. [More by Julie Jacobson]

6 Comments (displayed in order by date/time)

Posted by John  on  01/26  at  05:40 PM

I personally was not a big fan of Vudu when I first heard about the download times, but after viewing the crap quality that netflix has for streaming, Vudu seems like a much more reasonable alternative. That and the announcement that I can queue up movies from my iPhone and I was sold.

Posted by Greg  on  01/26  at  05:58 PM

There is no delay in downloading a SD or HD movie with Vudu if you have a 2 MBps connection, the 1080p HDX movies do take an hour or more but not the 20+ hours it takes to download a pirated blu-ray movie from the web. 

I hope they survive, its currently the best platform on the VoD market and I have seen them all.

Posted by Julie Jacobson  on  01/26  at  06:23 PM

I don’t think there’s any disputing that they have the best platform out there.

Posted by Ivan Y  on  01/26  at  10:01 PM

“There is no delay in downloading a SD or HD movie with Vudu if you have a 2 MBps connection”

A minor correction—“Instant HD” requires about 4 Mbps connection (2 Mbps is for Instant SD).

Anyhow, the HDX quality movies on VUDU are about as close as it gets to Blu-Ray for VOD, but I’m curious how they plan to work in their key P2P technology into partner boxes.

Posted by Todd  on  01/27  at  11:11 PM

I bought Vudu after having a apple tv.. the quality is so much better on my Vudu Box.. people who appreciate good video quality will prefer this box.. I already canceled my Netflix due to long wait long wait long wait..f that.. Vudu rocks..havent touched my apple tv since I put it in..

Posted by VUDUEvangelist  on  02/05  at  09:03 PM

Hi everyone, I am the new VUDU Evangelist and I really would like to thank everyone for posting thier opions about VUDU and the picture quality.  One thing that VUDU strives for is having the highest quality movie experiance.

On the HDX movies it takes about 4 hours to download before the movie becomes watchable.  If you know you want to watch the best quality ahead of time you can alway rent via the VUDU web site.

VUDU Evangelist

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