Disney, Fox Announce Video-on-Demand Deal

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The Walt Disney Co. and News Corp. will form a joint venture to provide Internet and cable-based video on demand, the companies announced Wednesday.

The venture had been expected after five other major movie studios announced a similar plan several weeks ago.

The new company will be called Movies.com and will use an existing Web site of the same name, which is operated by Disney.

Unlike the other major studio venture, Movies.com will also be offering films on a cable television service, which the companies say should launch about the same time as the Internet-based offering.

The companies said the joint venture is scheduled to debut early next year.

Also unlike the other major studio venture, films provided to the service by Disney and 20th Century Fox will appear on both the Internet and cable service exclusively for a short time after they are released on video and DVD and before they begin airing on pay-per-view services.

The other studios, including Sony Pictures Entertainment, Universal Studios, Paramount Pictures, Metro-Goldwyn-Mayer and Warner Bros., will provide their films to their video on demand service, tentatively dubbed "MovieFly," on a non-exclusive basis.

Disney said it will not be supplying its animated films to the service.

News Corp. is the parent company of the Fox News Channel, which operates FOXNews.com.