Warner Bro’s tries direct streaming movie rentals on Facebook

Media giant Warner Brothers announced this week that it has partnered with Facebook to test whether the social network’s 600+ million users would be willing to pay to stream movies directly through the site.

Warner Bros. has started the trial with the smash hit 2008 Batman movie, The Dark Knight, directed by Christopher Nolan, and starring Christian Bale and the late Heath Ledger. The movie is available for rent from the movie’s Facebook fan page using Facebook’s virtual currency (in the U.S. only at the moment), and users will have to pay 30 Facebook Credits (US$3) to watch it.

The rental period lasts for 48 hours, and the movie will stream directly through Facebook. Users will be able to be pause, stop and resume the movie in separate Facebook sessions. The studio has promised further test releases in coming months.

Facebook has inserted itself here as an alternative financial middleman to other digital film distributors such as Netflix (whose stock took a battering on Tuesday following the Facebook announcement), Amazon and iTunes, by offering the Warner films online for Facebook Credits, taking a hefty 30 percent cut of the profits in the process. The company’s focus has mainly been on advertising thus far, but focussing on properly standardising and monetising the Facebook Credit system may prove to be much more fruitful for Facebook in the long run.

Here are some pro’s and con’s of Warner’s Facebook movie idea:

Pro: Convenience

For users who already spend a good portion of their time on the internet and on Facebook, this is a natural progression to a captive audience which makes sense, as everything is in one place. Whether a full length movie will hold the attention of users also engaged in other Facebook and online activities at the same time is questionable.

Pro: Sharing with friends

The application allows viewers to make use of Facebook as normal while the movie streams, by posting comments while watching, updating their status and so on, which makes for a more communal and interactive online viewing experience.

Con: Quality and lack of device integration

Warner’s streaming movie via Facebook is only available on a PC, whereas competitors’ streaming technology is available on PC’s, and numerous televisions, set-top boxes, gaming consoles and mobile devices which offer a much higher quality viewing experience. DVDs and Blu-ray discs are generally also very cheap to rent or purchase, and combined with a good TV screen, this movie experience can be infinitely more satisfying than streaming online.

Con: Strange selection process

Why launch with a movie which, although uber-successful, has been around for 3 years already? This isn’t a promising start. Warner Bro’s says it selected The Dark Knight due to the high number of “Likes” on the movie’s Facebook fan page (more than 3.9 million) which indicates its popularity amongst the social network’s users. The logic of this doesn’t ring true however, as one would assume that if user’s have ‘Liked’ the film, they have already seen it, perhaps several times, and would likely own it digitally or on higher quality DVD or Blu-ray. Facebook users don’t appear to be particularly interested in the Warner Bro’s lukewarm offering; the “Watch The Dark Knight from Warner Bros.” Facebook app had only 1 750 monthly active users at the time of writing.

Con: Sharing your details with a corporate identity

Watching one of Warner’s movies requires you to link your Facebook account with their Facebook app. This gives Warner Bros access to your basic Facebook information including your name, profile picture, gender, networks, user ID, list of friends and anything you’ve publicly shared on Facebook. That’s a load of delectable information for marketing departments to salivate over.

Con: Facebook Credits

Facebook users can buy Credits using credit cards, mobile phones, or gift cards available for purchase in retail stores. Customers can’t take them out of the Facebook system, exchange them for cash or give them to other users, so it’s a much more limited system than PayPal for example. The security of the payment system and Facebook’s privacy history is also questionable, and the many people who don’t use Facebook Credits may not be inclined to hand over their credit card details just to watch a streaming movie which they can get in many other places.

Con: Reliant on very high speed connections

Ever tried to watch a high quality, full length streaming TV show or movie on a slow to medium (usually marketed as “high”) speed connection? Interruptions, buffering, pixelation and pain and frustration are all you get for your efforts. Assuming this is a service that will be launched worldwide, unless you live in a place where very high speed internet is affordable and copes with high usage, you might as well not bother.

Interestingly, The Dark Knight was also the launch choice for another of Warner’s new digital distribution methods for the studio, as it became one of the first Warner Bro’s movies available as a stand-alone app designed for the iPad last month, along with Inception later on. Rather than gaining access to the films through iTunes, consumers instead download a free app, which lets them buy the movies for unlimited streaming directly from Warner.

The app route is important because it avoids the geographical limitations of iTunes, as it allows Warner to sell Inception and The Dark Knight in 23 countries where iTunes does not currently operate a video store — including fast-growing and highly pirated markets like China and Russia.

Would you rent a movie to stream through Facebook? Let us know what you think in the comments section below.