Not that Edelstein would exactly describe Haunting Melissa  — the story of a teenage girl who believes her dead mother is haunting her, and then suddenly disappears — as a movie. “I didn’t want to take a movie and stuff it in an app,” he told me. Rather, the goal was to use technology “to push a story out to people in bits and pieces.”

Edelstein’s production company, Hooked Digital Media — which includes investor Kevin Washington as cofounder and MySpace cofounder Aber Whitcomb as advisor — built an iOS platform that pushes content out to viewers over time. Haunting Melissa doesn’t have a predetermined length: Edelstein shot thousands of hours of video, and it will be pushed out to viewers in “chapters,” or segments, on a timeline that can be tweaked on the back end. For example, if a user hasn’t entered the app for a while, he or she might receive a push notification that a new chapter is available.

In addition, the actual video content can be adjusted through the app’s content management system, so new content can be inserted into a chapter after a user has already watched it. The idea is to keep users coming back to the app, checking for new content and seeing what has changed.

The Haunting Melissa iOS app, available in the iTunes Store today, is free, as is the first chapter. If a user shares that chapter on Facebook, he or she gets the second chapter for free. Users can buy a “season pass” for $6.99 (standard definition or $14.99 (HD); if purchased individually, chapters are $0.99 for standard definition and $1.99 for HD.

“We are gambling on the notion that this is going to fit in the diet of people who watch and consume a lot of stuff,” Edelstein said. “This isn’t sitting down to watch X hours of House of Cards. It’s one piece of what you’re going to consume over the course of time.” He imagines that users will dip in and out of the app as new content becomes available — but he isn’t sure, because Hooked Digital Media hasn’t tested how viewers use the app. “We just have to go for it and see how people watch and react,” Edelstein said. “My experience in testing movies is that it’s a total clusterf*ck. Unless you have a sample size that’s over thousands of people, you can’t get an accurate measure of content consumption.”

So the company is waiting to see what viewers do and how they share Haunting Melissa on social media. Edelstein describes the creation of Haunting Melissa as “low-budget independent film making.” He tapped industry connections who wanted to work on a different kind of project and got to test new skills — like iPad color correction — for Haunting Melissa. “Because of that excitement level,” Edelstein said, “I was able to work with people I’d worked with before.” He is now working on a sequel.

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The acquisition, which is subject to regulatory approval, will be roughly half cash and half stock. It includes all of Lucasfilm — not just the Star Wars franchise but “its operating businesses in live action film production, consumer products, animation, visual effects, and audio post production,” as well as “the substantial portfolio of cutting-edge entertainment technologies that have kept audiences enthralled for many years.”

“We’re likely to focus more on social and mobile than we are on console,” Disney chairman and CEO Robert Iger said in an investor call Tuesday afternoon, “given the nature of these characters and how well-known they are…they lend themselves quite nicely to [these] platforms.”

Kathleen Kennedy, who has served as co-chairman of Lucasfilm since June when George Lucas announced that he was getting ready for retirement, will become president, reporting to Walt Disney Studios chairman Alan Horn. She “will serve as executive producer on new Star Wars feature films, with George Lucas serving as creative consultant.” Star Wars Episode 7 is slated for a 2015 release, with the next films to come every two to three years after that. ”A lot of the value that we attribute to this deal is [still] to come,” Jay Rasulo, Disney senior EVP and CFO said on the investor call.

Lucas — who was not on the investor call — said in a statement, “I’ve always believed that Star Wars could live beyond me, and I thought it was important to set up the transition during my lifetime. I’m confident that with Lucasfilm under the leadership of Kathleen Kennedy, and having a new home within the Disney organization, Star Wars will certainly live on and flourish for many generations to come. Disney’s reach and experience give Lucasfilm the opportunity to blaze new trails in film, television, interactive media, theme parks, live entertainment, and consumer products.”

Disney would not disclose Lucasfilm’s annual revenue, but the Star Wars films have pulled in over $4.4 billion worldwide.

Disney’s most recent major acquisition was Marvel Entertainment in 2009. Disney bought Pixar Animation Studios for $7.4 billion in 2006.

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New shows include seasons of Friday Night Lights, Parks and Recreation, Parenthood, Heroes, Battlestar Galactica and others.

“We look forward to further expanding NBCU’s content offering available to Prime subscribers in the near future,” said NBCU’s Frances Manfredi.

Counting the new shows, Prime Instant Video now offers 22,000 movies and TV episodes free to Prime members, who pay $79 a year for free two-day shipping and other perks. As of April, Netflix had over 60,000 streaming titles (but it still doesn’t have the third season of “Parenthood” — and now Amazon does).

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1. it has signed a million UK and Ireland subscribers in just six months (see our July story).
2. it is bullish about out-bidding BSkyB for UK movie rights it needs to become more successful (CEO Reed Hastings told paidContent in January).

What is going on? Netflix is press-releasing this week to trumpet genuine early success in customer acquisition, likely hoping the headlines will impress movie studios it needs to court for better rights.

Sky Movies, which has nearly five million subscribers, has exclusive UK deals with the big six Hollywood studios to show movies after the post-cinematic DVD window. Netflix’s selection is thinner, poorer and later.

Netflix will need to spend heavily to unpick that lock. But its domestic U.S. track record shows it can do exactly that. So how much will it require?

Details of BSkyB’s Hollywood deals are sketchy; the company declined to give information to paidContent, citing “commercial confidentiality”. But Sky has previously disclosed that it paid £278 million in annual movie rights fees in 2008/09.

The amount it pays is based partly on the number of subscribers it has. So, for example, if BSkyB can make a success of its new Now TV brand, which will take Sky Movies to internet devices, it will have to pay more.

Netflix may have the wherewithal; it has spent heavily in the past. In 2011, it splashed out $674.4 million more on deals to snap up more streaming rights for Canada, Latin America and the Caribbean, bringing its total annual content outlay up to $1.78 billion.

“We will be really aggressive in our bidding,” Hastings tells The Telegraph. “It may be that we win in the first round. It may be that it takes two or three years, but we’re incredibly confident that we will win the bidding for some of Pay 1.”

But, in Sky, it has a powerful incumbent competitor that also has proven it can dig deep to acquire content. The recent auction for live rights to three seasons of soccer’s Premier League, won mostly by Sky ‘s renewal bids, saw winning bids’ total value double from the previous package, from £1.254 billion to a record £3.018 billion.

BSkyB CEO Jeremy Darroch has shown that Sky can splash much more cash to secure top content like Premier League soccer.

Against that sporting backdrop, Netflix could be to Sky’s movie renewal what BT Vision and Al Jazeera were to its Premier League bids – rival bidders which didn’t steal any rights from Sky but which succeeded in driving up the price it had to pay; a stalking horse.

One factor that may mitigate Sky’s spending power is the £30 million it is already spending this year to launch Sky Movies on IPTV devices as Now TV. But that is not as important as renewing rights themselves.

Netflix expects to lose up to $105 million this Q3 on its international operations, after spending heavily to market what is otherwise a low-staff European operation. It was recently buoyed by slightly lower UK and Ireland roll-out costs than expected, but remains under pressure at home to steady the ship and return to the black.

If that cost proves too much for Netflix, the upstart has got its defense in first. In June, it grumbled to regulators that ”Sky continues to hold a near monopsony on the acquisition of these rights”:

“If, in the upcoming year, it becomes apparent that Netflix and other Sky competitors are not able to obtain significant FSPTW rights from the major studios, this may demonstrate that continuing market dominance by Sky has resulted in Netflix having to find other routes to the acquisition of FSPTW content—other routes which avoid head to head competition with Sky for the acquisition of rights which Sky wishes to obtain in order to maintain the market position of Sky Movies.”

So, if Netflix can’t steal films from BSkyB in the next year, expect it to have to think out of the box.

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“Six months ago, we launched Netflix in the UK and Ireland, and today we are one million members strong.”

In just two quarters and two countries, Netflix has gathered an online customer base equal to half of that which Lovefilm, which also rents out DVDs and games, has amassed in five countries and over a decade.

The company doesn’t even have a UK office.

Netflix has invested very heavily in a UK and Ireland marketing campaign that includes multiple high-rotation TV ads and direct mail, and which has driven mainstream awareness for over-the-top movie subscriptions as a segment.

That investment hurts Netflix’s bottom line, but one million subscribers paying £5.99 per month gives Netflix monthly UK and Ireland revenue of £5,990,000 or £71,880,000 per year, and it’s only growing.

In Tuesday’s earning disclosure, Netflix repeated its launch-time stated theory that Lovefilm is not its main competition:

“We believe we have pulled ahead of Lovefilm in every important streaming-related metric.

“Going forward, competing effectively with Sky is our core and substantial challenge.”

Lovefilm claims two million subscribers and won’t disclose subscriber count for its Lovefilm Instant streaming tier, which it launched alongside Netflix in January. Netflix likely already has more streaming-only customers than Lovefilm does.

The UK over-the-top movie subscription segment is now hotting up. Aside from these two challengers, BSkyB, which owns exclusive licenses for offering movies from six Hollywood majors via subscription, is making them available to its own satellite subscribers on internet devices and last week launched Now TV, a spin-off over-the-top service offering Sky Movies without satellite subscription for £15 per month. That is three times more expensive than either Netflix or Lovefilm, but avid blockbuster fans may consider the newer, bigger catalogue three times better.

Amazon must decide how much it wants to capitalise Lovefilm so it can front up on content acquisition and marketing.

Impressively, Netflix’s one million new UK and Ireland members is also about half the size of the customer base it had signed in Canada and over 40 Latin American countries in a whole two years.

Netflix now intends to replicate its UK and Ireland roll-out elsewhere in Europe. But, as it invests in doing so, it will also need to spend heavily to out-bid BSkyB for UK and Ireland studio deals. As recent fee hikes for Premier League soccer show, BSkyB has the wherewithal to invest heavily in content.

The threat to Netflix, however, is its catalogue, full of old fare.

“As long as there are good markets to enter around the world, we will take U.S. profits and put them in to international expansion,” CEO Reed Hastings told investment analysts.

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Yesterday at its Google I/O event, the company announced more content options, so I decided to compare Google Play against the two incumbents. So how does Google now fare, considering it introduced the Nexus 7; an Android 4.1 tablet that’s optimized for Google Play?

I did a similar analysis in October, only then it was to see how Samsung fared against Apple and Amazon, and decided to take the same approach here with Google. Here’s what I found when looking at the most popular movies, TV shows, music albums, starting first with music.

Amazon sounds cheaper while Google Play has some dead air

Amazon offers the most “bang for buck” here, although prices can vary by the day. Just this morning, a George Harrison album on my wish list, for example, dropped from $9.99 to $2.99 and I bought it. In terms of the top 10 — again, using iTunes as a baseline — Amazon has 9 of 10 while Google is batting .600 with four strikes. Of course, this is just a narrow view; when casually browsing all three stores for music that I like, they’re generally equal although Google is still either missing a few.

Google at the movies isn’t bad

Google fares a little better here although it still lacks the breadth of content provided by iTunes and Amazon when looking at the current top 10. But like Amazon, Google Play offers lower prices than those found in the iTunes store. When the family wants to watch a movie, I’ve turned to iTunes in the past — mainly because we have an Apple TV. For my own consumption on a tablet or phone, however, I’ve been fine with Google Play. Amazon doesn’t support movie playback on any phones or tablets save its own Kindle Fire, so I rarely look there. Update: The original comparison showed Amazon with SD movie rental pricing, which was incorrect as pointed out by readers. The current table shows the HD movie rentals.

Don’t look for recent TV shows on Google

If you want to watch current HD episodes of TV shows, Google store isn’t playing. The company announced TV show support yesterday, but it’s like looking through an old Netflix catalog as current hot shows aren’t there. Even Amazon falls a little short: When looking for the most recent episodes of popular shows on iTunes, Amazon lacked one and had another in standard definition only.

Magazines are magazines are magazines

Google also added magazine support in Google Play this week and rather than be methodical about the comparison, I spent about 20 minutes browsing the digital newsstands. The main reason why is because the top magazines were available among all three at the same price. Checking the breadth of titles showed the same: Google is at least on even par with Amazon and Apple here. The experience of reading magazines may vary by device — small tablets and phones vs the 9.7-inch iPad, for example — but there’s little differentiation in content here.

Conclusion

Apple’s iTunes Store and Amazon’s market are a close one and two while Google is still playing catch up. Yes, the company has improved digital media offerings in Google Play of late, but there’s still work to be done. I recently said that consumers aren’t buying products anymore; they’re investing in platforms instead. Android as a platform may be the best seller, but Google needs to keep negotiating content deals to strengthen its ecosystem and give consumers a reason to shop in Google Play instead of Amazon or iTunes.

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Berlin’s Moviepilot.com, which is making its big push into the U.S., hopes to kill both birds with one stone. And, judging from the $7 million Series B round it revealed on Thursday, it’s armed with a boulder.

The round was led by new investor DFJ Esprit, along with Deutsche Telekom’s T-Venture, Grazia Equity and Creative Industries Berlin — all of which have already been backing the site’s German incarnation, moviepilot.de.

That German version is quite a different beast, however. It’s a Google-driven rumor and recommendation site that in turn powers Telekom’s T-Entertain IPTV package, and it’s very successful, with two million monthly uniques and 1.4 million Facebook fans. In fact, that makes it Germany’s most popular Facebook page, bar that for soccer team Bayern Munich.

But, as CEO and co-founder Tobi Bauckhage told me, it was only a first step:

“Based on the recommendations and based on this Facebook understanding, we said we had a chance from Berlin to create a new generation movie site that is concentrating on early fans, using the Social Graph and the Open Graph to learn about the fans, and kickstart recommendations based on that.”

So in October last year the startup opened Moviepilot.com, an English-language second iteration that’s plugged into a separate Facebook page that’s already amassed four million fans. Combined, the two services constitute the social network’s largest movie fan community.

Fans can use the service to discover new projects and follow them — one of Moviepilot’s many facets is that of a curated, personalised news site. And for the studios, the community can provide some sorely-needed marketing insight.

“We’ve always thought the real power of tech is not the distribution but discovery, not even of films, but discovery of audiences,” Bauckhage, a film-maker himself, said. “Discovery and recommendation is still supply-driven, but we’re moving to a model where you have to learn about your audience and build audiences.”

Audience insights

The problem, Bauckhage explained, is that the whole industry revolves around the opening weekend.

“It’s a supply-driven industry with a very limited shelfspace, with only a limited number of cinemas and screening rooms,” he said. “The anomaly of this industry is that you have a market entry phase of only 48 hours – this predetermines the money you’ll make in the whole lifecycle of the movie.”

So what do studios do? Generally, they launch a barrage of poorly-targeted advertising just before the all-important weekend. Moviepilot.com is in a position to tell them who’s following their projects, right from the first rumour to the release.

“For example, we had 15,000 fans for the Avengers before the film came out,” Bauckhage explained. “They use Facebook Connect to follow a project, and we get information back from the fans and understand what the fanbase is made of. We can see that, hypothetically speaking, they are 15 times more likely to be Buffy fans – we believe that the real dimension of how you understand audiences is not demographics, but taste.”

And the industry already seems to be lapping it up. Twentieth Century Fox is currently paying Moviepilot to promote the upcoming Abraham Lincoln: Vampire Hunter to early fans, and the studio knows it will get very granular data in return. Universal, Disney and Paramount are also clients.

So there you have it: Moviepilot is a pretty unique combination of fansite, rumour and news aggregator, and social marketing agency. Its new funding will allow it to open an office in Los Angeles this year, with a dedicated sales team in tow.

The likes of IMDB and Flixster should be watching this development with a concerned eye.

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“Whenever we needed money, we’d rob the airport. To us, it was better than Citibank.” — Henry Hill, Goodfellas

Seven years ago, Walmart controlled nearly half of a U.S. DVD sell-through business that generated nearly $16.3 billion in annual revenue. But even with disc sales plunging below $9 billion last year, and overall home entertainment revenue dipping to $18 billion from $24.3 billion over that same span, Hollywood’s movie business is still beholden to Walmart’s Bentonville, Ark. headquarters.

Fortunately for them, studio executives — and members of the media and tech press — only needed to travel about 15 miles East on the 60 Freeway to Rosemead, Calif., Wednesday to see the retailer show off what might be the home entertainment business’ last hope to resuscitate growth, the so-called “Disc to Digital” service.

Disc to Digital is a key component of the major studios’ UltraViolet initiative, which is designed to let consumers store digital  versions of the movies they’ve purchased on disc in a cloud.

Starting Monday, within the photo processing areas inside about 3,500 U.S. Walmart stores, consumers can begin uploading their disc collections to the cloud, paying $2 for each authenticated title (or $5 if they want to convert a standard-definition DVD to a high-def digital file).

$2 and two minutes of your time

I showed up at Wednesday’s demo at about 1:15 p.m., right ahead of a small contingent of Universal Home Entertainment executives, led by division president Craig Kornblau, holding a DVD copy of Universal’s 1997 Jim Carrey hit Liar Liar.

“Hurry, I just can’t wait to get into the cloud,” the affable Kornblau quipped, delighting a small cadre of chain and consortium PR staffers, as well as store employees who were still learning about how to administer the Disc to Digital service.

I had forgotten to bring my discs for upload, but Louis, a kind Walmart employee loaned me a copy of Warner Bros.’ 1990 Martin Scorsese gangster classic Goodfellas, so that I could test drive the system.

Walmart’s Disc to Digital service enables users of UltraViolet-authenticated DVD and Blu-ray titles to also own digital versions of their movies in Vudu, the retailer’s popular digital movie rental and sell-through service. Since I’m already a happily registered Vudu user, getting set up was pretty easy.

I filled out a form, offering up my Vudu user email, and also indicating what version of Goodfellas I wished to upload (I chose HD).

About two minutes later, Louis emerged from a computer workstation — he had stamped the disc with a little Walmart insignia, so that it couldn’t be authenticated again, and I had a high-def version of Goodfellas waiting for me in my Vudu account, ready to download or stream to a wide range of living-room and mobile devices, and share with select family members.

Bringing back $20 movie purchases

The system is designed to rekindle consumers’ willingness to buy movies rather than merely stream them on platforms like Netflix. Last month, research firm IHS Screen Digest, for example, noted that low-margin movie and TV show streams will surpass  higher-margin disc sales and rentals in quantity, with the overall home entertainment sector still continuing to see revenue declines.

As of late February — about four months after launch — UltraViolet had claimed only around 1 million sign-ups. However, the Hollywood majors — who will greatly expand the number of UltraViolet-eligible titles to around 4,000 on Monday — hope the inclusion of Walmart and Vudu will accelerate the initiative’s buy-in.

Having already talked to a number of ranking home entertainment executives who are quietly pessimistic regarding UltraViolet’s success, I still left Rosemead Wednesday slightly excited.

The house of no Mouse

With a trip to my mother-in-law’s retirement-community condo rendered upon me for this upcoming weekend, I saw value in being able to watch Joe Pesci’s Tommy DeVito savagely beat and murder all who annoyed him as I distracted myself with Goodfellas on my iPad 2. But since a wireless connection isn’t available there, I might be as out of luck as Michael Imperioli’s poor, half-witted Spider — on the iPad, Vudu will only let me stream the movie and not download it. (I can always buy it again on iTunes — Apple, which is conspicuously absent from the UltraViolet grouping, will let me download movies to the iPad, of course — but the whole point of UltraViolet is supposed to be about letting me enjoy the movie on any device I want with a single purchase.)

Then there’s title availability. Any urge to selflessly provide my 6-year-old son the same kind of relief with a downloaded copy of Cars 2 or Toy Story 3 can’t happen either, whether or not I can find a wireless connection, since the biggest supplier of kids’ movies, Disney, doesn’t do UltraViolet.

Meanwhile, not every title from every participating studio is available. For example, as we reported earlier this week, Fox movies like Rise of the Planet of the Apes become unavailable on platforms like UltraViolet and Apple’s iCloud once they enter any of HBO’s pay-TV windows.

“Today, everything is different … I ordered some spaghetti with marinara sauce and I got egg noodles and ketchup. I’m an average nobody. I get to live the rest of my life like a schnook.” — Henry Hill

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With Universal reaching an agreement with HBO to relax contract rules limiting cloud-based distribution of movies during their pay-TV window, Fox is now the only studio that faces restrictions for its titles on Apple’s iCloud and UltraViolet.

Fox and HBO are still working on an adjustment to their long-term agreement that would allow digital storage and access of Fox titles on these cloud services during their pay TV window. Access generally starts six months after DVD release and extends anywhere from 12-18 months. (Depending on the deal and the movie, films can also later re-enter second and third pay TV windows.)

But the clock is ticking. On Monday, Walmart will launch a retail promotion campaign designed to kickstart the struggling UltraViolet cloud initiative — and all the studios were supposed to be aboard. (Update: Disney is not in the consortium backing UltraViolet, a fact not mentioned in this report earlier.)

That’s when Hollywood’s major studios will make about 4,000 titles available for UltraViolet storage. But Fox’s 10-year, $1 billion pay TV deal with HBO, signed in 2007, will limit its participation in UltraViolet. The studio-backed initiative offers DVD and Blu-ray purchasers a cloud-based digital copy of the movie they just bought, as well as films they already have in their disc library.

Those who purchase Fox movies like Rise of the Planet of the Apes on iTunes will be similarly affected, with access to iCloud restricted (see lower left hand corner of the embedded photo). Put simply, when Fox movies enter their various pay TV windows, they will be blacked out from the cloud.

Last year, Warner Bros., which like HBO, is also owned by Time Warner, worked out an adjustment to its HBO contract whereby consumers who purchased the studio’s films prior to their entry into the pay TV window could still access and store their bounty in iCloud and UltraViolet during the blackout period.

On Monday, paidContent confirmed a Mac Rumors report that Universal was able to get HBO to agree to a similar allowance.

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