Making Music With Kiosks

V3 Media believes digital media should be ubiquitous—as ubiquitous as the ATM machines that dispense cash on every street corner and in every retail outlet.

So it’s only natural that executives and engineers at the Las Vegas-based solution provider have taken to calling their new Intel-based single-purpose system an “ETM,” an entertainment teller machine that dispenses videos like cash.

“The way the ETM works is with a touch-screen,” said Michael Poncher, executive vice president of V3. “If you know the genre, the artist or the name of the movie. or the first initial in one of the words in the title, you tap it in.”

V3 Media has invested $4 million and three years developing its MediaRacer solution. The system sorts through a database, locates the file and burns it to a CD or DVD right on the spot. In one deployment last year, V3 provided its MediaRacer system to a Las Vegas music publication and distributor, Smash Magazine, which caters to regional rock bands and their local fans throughout the Southwest.

But V3 is hoping to crack a much larger market to gain a return on its three-year development effort. The company has been in what Poncher called fruitful discussions with a major national retailer, which he declined to name, and expects to roll out as many as 10,000 of the media-on-demand kiosks this year. That would be a big win.

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he appeal to large retailers is the ability to expand inventory and carry more titles to serve the tastes of an increasingly eclectic audience. “The most [CD or DVD] titles you’re going to see in any retail store is between 900 and 1,000,” Poncher said. “We can provide 150,000 titles.”

Poncher said the company—which employs 15 people, mainly engineers, and has recently begun hiring in anticipation of expansion—will use its own brand, MediaRacer, on the solution or build systems that are branded with a customer’s name.

This is not the first time Poncher has been involved with the rollout of a burn-on-demand solution. Last year, he worked as a consultant for a now-defunct system builder that partnered with Protocall Technologies, an ISV in Commack, N.Y., to develop a software burn-to-CD kiosk solution. The solution was rolled out at 225 CompUSA retail outlets.

Poncher said he figured if the concept worked with computer software, it could work with any digital media. After the CompUSA rollout, he went to work for V3 with a broader vision: targeting the potentially bigger markets for retail video and music on demand.

While the music part of the equation is not difficult because of the small file sizes, video presented a challenge. That’s where V3’s expertise came in. The company has developed proprietary media compression and decompression technology—PAV2, which stands for “picture, audio and video.”

The MediaRacer solution not only provides compression and decompression technology but also database capabilities that allow for easier storage, transmission and copying of digital-rights protected media. DVD burn time on the solution is about five minutes, Poncher said.

If the concept takes hold, the potential market is huge. The music industry alone ships about a billion CD units per year, a market of between $13 billion and $14 billion annually, according to the Recording Industry of America.

The video market is even larger. The Digital Enterainment Group estimates that consumers last year spent $21 billion either buying or renting DVDs worldwide.