Move aside HBO, Showtime, and Starz!, Blockbuster is currently in talks with Viacom to start it’s own premium channel. The move would involve Blockbuster investing in a partnership with Viacom in return for the digital rights to the new channel.

The network which is expected to debut in the fall of 2009, would mix movies and television shows from Paramount, MGM, and Lions Gate. Currently those studios have an agreement with CBS owned Showtime, but talks have stalled on renewing that deal.

From a consumer perspective, I understand why Blockbuster would want to look for new business models that focus on the digital side of things. But I don’t know if a new TV channel is a step forward unless there is a massive on-demand section involved with it to go with a superior selection. Consumers want selection at their fingertips, not another channel that is telling you what you should be watching. The Viacom press release did say that this would be a potential “game changer” for the industry.

What concerns me about this model is that it only involves those studios. When I’m searching for movies through any of my DVD rental accounts, I don’t go by the studio nor care. I don’t want to be tied into a set of studios. I don’t want to have to sign up for 5 premium channels to get all the movies under one roof. This kind of channel hurts independent filmmakers that don’t work with a major studio.

I do see a few scenarios for how this channel could be really good. First, everything needs to be on-demand. That means their entire library at the touch of a finger on to my TV. A way to link up my account online to my TV box so that I could add or search their database from my computer (and not a clunky TV interface). Getting newer movie releases faster than anyone else. And finally, having new TV shows on their right after they are first run on the networks. That would be a quality service despite the limitations posed by only having those major studios involved.

But it’ll ultimately come down to whether these channels can offer me something that the DVD rental services don’t have. The Viacom press release seems to indicate that MGM, Paramount, and Lionsgate have about 20,000 movie titles under their control. I can get 80,000 from Netflix, including those from the major studios I just listed. Sure it might be a day wait, but my selection is four times the amount of this channel. Inventory trumps convenience in my book.

Nothing is for certain and this could all just be a big rumor. It makes sense though for both sides, although it does come at the same time Blockbuster is looking at making the moronic move of buying Circuit City. We’ll keep up-to-date on the situation and post about any news.

Source: Wall Street Journal