The Truth About Divx?

One of the first DVD-related sites on the Web was Robert's DVD Page; it still contains a seminal work in the online campaign against Divx. Even now, it is held up in home theater discussions as a comprehensive analysis that thoroughly and conclusively proved that the Divx home video system is at best, all but bereft of merit, and at worst, a sinister threat to consumers and even to civil rights.

But did this study really prove the case against Divx, and in so overwhelmingly one-sided a fashion that 35 negative points about the product could be found against only 2 positive ones? Did anyone with knowledge of the system examine the arguments it proffered, and take the time to publish their conclusions? The answer would appear to be no--until now.

The following paragraphs contain, in point-counterpoint format, a long overdue, comprehensive review of the 35 points of The Truth About Divx.


More expensive hardware The Divx players are more expensive to make than comparable DVD players. Circuit City is not carrying the least expensive DVD players or are only selling them at higher prices to make their customers believe that Divx is not more expensive. According to Richard Sharp CEO of CC and Divx the Divx players costs 200 dollars more than a comparable DVD player when using the best offers from other stores.

In actuality, the price differential between Divx-compatible and DVD-only players eventually dropped to $50. For example, in the spring of 1999, the RCA 5231Z sold for $350 at Circuit City, while its DVD-only counterpart sold for $300 at the popular Target discount chain.

The $50 price premium for Divx compatibility was regularly blasted by detractors as an outrageous extravagence, despite the fact that it granted users access to a convenient alternative to traditional video rentals, not to mention high-quality digital versions of a number of desirable titles then unavailable on regular DVD. These same voices, however, were absolutely silent on the matter of a little-used frill, costing about the same amount, found on most mid-range and high-range DVD-only players: the built-in Dolby Digital decoder. DD bitstream decoding is normally done in the receiver, not the player, and thus few who pay for this feature ever use it.


More expensive software Buying a Divx disc you just pay for the first 48h rental period. This is far more expensive than a rental of a fully featured DVD title.

Divx rental discs sold for $4.49, a price quite competitive with the $3.99 price of Blockbuster, the largest rental chain in the U.S. (and Blockbuster rentals require a return trip to the store, more than making up for the extra expense). Had Divx survived, that $4.49 likely would have dropped as DVD technology matured and disc replication costs dropped. As for extra features on DVD, they may have been standard in 1998 but today, many discs come with little or nothing in that area, and the typical renter is not interested in them anyway.

Ironically, two-and-a-half years later, Blockbuster (and other chains) had significantly raised rates on DVD rentals since Divx's demise. In some areas (Richmond, VA, the home of Circuit City, for example) the charge was as much as $4.50 for a single night on a new release, and $3.50 for two nights for old catalog titles!


More expensive and complicated hookup You will have the extra expense of installing a permanent telephone lines to all your Divx players. If disconnected from the phone line for a longer period the Divx player will simply not work again. This is unlike any other consumer electonic device using a telephone connection.

Untrue--all that was needed as to install a splitter on the phone line, something most of the players had bundled with them, and multiple players would happily share a line with other devices and voice/fax. If you didn't have a phone line handy, a Divx player needed to be connected to one only for a short period once every few weeks. Case in point: of the five players registered to my account, only two were constantly connected to phone lines. And the idea of billing via a telephone line was something Divx? In actuality, it was borrowed from pay-per-view TV, a fact anti-Divx advocates rarely acknowledged unless directly confronted with it.


Lower quality and less content While there are now 3 widescreen Divx releases, about 99% of them are only pan&scan. No Divx discs contains both widescreen and pan&scan versions of the films or all the extras people are getting used to with DVD. The strong watermark(noise added to the picture to be able to track a VHS-copy) will also result in visible image degradation for some display devices.

Although it is true that most Divx titles were 4:3 aspect ratio, many of those were open matte, not pan&scan, while others were TV shows or pre-widescreen films in Academy Standard, and thus were presented in their original aspect ratios. As for widescreen, the percentage of Divx titles released in letterboxed and 16x9-enhanced letterbox format was increasing steadily at the time of the shutdown.

Most (but not all) Divx discs did not come with extras, anymore than VHS rental tapes did. Today, with DVD having grown out of a niche format into a mass-market one, the same can be said for more and more DVDs as well, especially non-blockbuster catalog titles. In fact, many discs released now don't have so much as a trailer, and sometimes not even an accompanying booklet or insert. Even scarcer are widescreen and 4:3 versions on the same disc; although that was common in the early days of the DVD format (and MGM has hinted a return to this practice), today most discs have the content in either widescreen or 4:3. Some popular titles (mostly family-oriented) are made available in 4:3 only, despite the howls of outrage from cinemaphiles.

This writer never noticed any troubles with Divx watermarking, even after playing many Divx discs on four of the five available player models, including the low-end Zenith DVX2100). Sources indicate that in order to detect the watermark, one had to intentionally scan, frame by frame, precise time indices in the film, specific areas of the screen, and know exactly what to look for, in order to see the mark. It was imperceptible otherwise. This anti-piracy technique worked so well, in fact, that it is now making its way to DVD.


Few stores As there are so few Divx accounts(20k?), because selling the discs means double inventory, because there is so little profit margin on selling the first Divx period and because Divx is owned and controlled by a competing electronics store there are nearly no other stores willing to carry the Divx discs. In 3 states there are no stores at all.

Although the distribution of Divx discs was less than optimal, there were Circuit City stores conveniently located in most U.S. areas, supplemented by a few non-Circuit City chains like the good guys!, and for those in areas without any Divx brick&mortar retailers close by, Divx itself offered a mail-order service with competitive shipping. In addition, Divx was working on improving retail availability of the product, and in fact had just worked out a deal with a chain of drugstores at the time of the shutdown.


Hostile to the environment Many people will throw away the Divx disc after the first viewing as the plastic disc is then worthless. This in not exactly environmentally safe.

Although packaging of convenience products like fast-food generates considerably more solid waste than Divx discs ever would have, to placate environmental concerns Circuit City offered recycling bins for Divx discs. In reality, though, most people would likely have kept the discs or traded them with friends--in other words, using Divx as the near video-on-demand system it was, and that Circuit City should have marketed it as.


Incompatible Divx discs can't be played on the about 1,5 million DVD-Video players or any of the about 7 million DVD-ROM drives sold so far. There will never be any DVD-ROM drives or portable DVD-Video players that will support Divx. This will assure that Divx can never be as big as DVD-Video.

Consumer electronics products change constantly, and quick obsolescence is a fact of life. Early DVD players didn't handle DTS, others choked on discs with DVD-ROM features, component inputs became popular, and now progressive scan and hardware scaling are the latest hot features. Also, someone who'd bought an early DVD player, and who later on wanted a Divx-compatible player had the choice of selling it to someone else who wasn't interested in Divx, and recouping part of their investment.

The lack of Divx compatibility with DVD-ROM drives is mostly a non-issue, because an overwhelming preponderance of the viewing public wants the convenience of a set-top player.

Divx's goals regarding market penetration were 15-20% of the VHS market, easily achievable even restricting their hardware sales to set-top units only.

As a final point here, many purchasers of DVD-only set-top players made the conscious choice to ignore Divx, meaning that they had no interest in it anyways.


Confusion Launching a competing format will confuse the consumers and confused consumers will not buy anything. The consumer acceptance of DVD will be delayed worldwide. The delay may be so long that it comes too close too the launch of the next DVD generation with HDTV resolution.

Many analysts believe that the opposite happened, and that the threat of Divx competition spurred many business into offering DVD products earlier than they would otherwise have. Rental stores began carrying DVDs even though the market was too small to be profitable, Internet e-tailers offered an incredible array of loss-leading deals on DVD discs (only a fond memory today), and the Best Buy chain, Circuit City's competitor, began aggressively promoting DVD players (working with Toshiba to bring to market a $300 player) and discs.


Fraud Many average consumers will not understand that the Divx disc they buy can't be played in any DVD player and they will also have problems understanding the rental system. Less honest people will take advantage of the confusion and sell Divx discs as used DVDs. This has already been observed several times at ebay.

Although it is true that unscrupulous eBay sellers take advantage of buyers who think they are getting DVDs, it can be argued that had the system become widespread, people would have become familiar with the differences between the two systems, and this would not be happening, at least to the extent that it is.

As for the system being too complex for the average person to use, the Webmaster believes that if a six-year-old family member can understand it, adults should have no difficulty.


Lies In order to sell Divx lies and half-truths has been reported to have been used in allmost every CC store. Even the official info and ads from CC and DVE has been marked by this.

The key word here is reported - apart from some anecdotal evidence provided by very biased Internet sources, no evidence of this was shown. This writere's own experiences with Divx sales pitches showed them to be basically honest. In fact, customers who bought Divx-compatible players (apart from the low-end DVX2100), could have done a lot worse. Those who bought the Proscan PS8680Z over the comparably-priced Toshiba SD3108 DVD-only player (which had buggy firmware, slow layer changes. and poor anamorphic downconversion) should consider themselves lucky, while buyers of the Panasonic X410 should be pleased to know that that unit was the only member of the A110 family not to have problems with the top-selling Matrix disc.


Not for families with children Paying full price to get an exstended(no, they are not unlimited) rental period will not be possible with all titles. Try to calculate what 1 year of Lion King would cost and try to imagine explaining to the kids that they can't see the title even if it's on your bookshelf.

Divx was a rental system, but virtually all the non-Paramount titles in the Divx catalog were available for conversion to DivxSilver unlimited play, either on release or once their rental window had elapsed. The Disney animated titles released to Divx were in the former group.

Paramount, the source of most of the titles that were not convertible to DivxSilver status, directed customers wanting unlimited play to the DVD versions. (Like Dreamworks, Paramount had no titles digitally exclusive to Divx.)


No 2nd hand market You can't sell your Divx movies even if you have paid Divx full price to "own" the titels.

The notion of selling used Divx rental discs makes about as much sense as trying to sell the Blockbuster rentals one rented last fall. As for DivxSilver conversion, one didn't have that done to "own" the titles, one did it so that you could have unlimited viewing privileges for a disc on all players registered to a given account.

The writer makes a good point when he states that DivxSilver status was not transferable (although people were known to do so via transferring accounts). In this Webmaster's opinion, those interested in DivxSilver conversion process would have been better served by purchasing the DVD version wherever possible, and reserving DivxSilver conversion for those titles where the only quality alternative was laserdisc (which requires an expensive high-end player if the image quality is to even approache that of DVD or Divx).


No more video nights with your friends If you take a Divx disc you "own" over to a friend not only does he need to have a Divx player, he will also have to pay a 48 hour rental fee to play the disc.

For most people it would not have been an issue, and might even have been an advantage. (What better way to discourage people from borrowing your discs and subsequently damaging them?) Once, this writer did take a Divx copy of "Spaceballs" to an acquaintance's place, bringing over an X410 to play it on.


Expensive demos It will not be possible to show a part of a scene on a Divx disc to demo the new digital video format without having to pay a full 48 hour period for it. The Divx retailers will equally not be able to demonstrate their players with actual Divx discs.....

If a customer had a Divx disc (non-Paramount and not a title in its rental window) that they wished to use for those purposes, they could have had it converted to DivxSilver, and any retailer could have done the same. Or, they could have simply used a DVD instead. (Most Divx owners had at least a few of those.)


You will have to lock the video player away Imagine if the babysitter would take a short peek(Looking for cool menus and extras...believing that it's real DVD discs) at 50 of the movies in your collection that you do not yet "own" or have not yet watched. Hiding the discs/player or setting a password is something that actual consumers(those with 12:00 blinking on their VCR) are not likely to do.

Setting and using the password feature on Divx players to prevent unauthorized rentals and DivxSilver conversions was very simple, much simpler than setting the time on a VCR (everything was done using the regular player setup menus that everyone ends up using sooner or later). In fact, parents with small children could have set up the Divx password at the same time they set up the player's parental lock feature.

Looking at menus did not incur a charge, and the only Divx extra (a featurette on the 16x9-enhanced Amistad) was free to view as well.

Additionally, one would assume that if you were entrusting a person babysitting to the care of your children, in your own home, you would have already set guidelines as to what the sitter was allowed to do with your other audio-visual equipment. Why would your Divx player be any different? And the nice thing about a Divx bill was that it noted exactly the date and time the charge was incurred, so you'd know without question if the sitter was responsible.


Expensive errors "Hey, this is the wrong film!" How many times have you put the wrong VHS or CD into a player? That error will now cost you a 48 hour rental.

The Divx player would always prompt before starting a new viewing period. In fact, if the disc had been played on any player registered to the account of the player being used, you would be told the the viewing charge, in addition to how long the viewing period was good for.


Films can become unplayable If another company buys the rights to a movie or if Disney again put one title on moratorium expect that a Divx disc you have paid full price for can suddenly become unwatchable.(If you believe I'm just inventing this you should carefully read the Divx customer account agreement).

Although viewing rights technically could be turned off by the Divx central billing system, of questionable legality was the indefinitely making unviewable without compensation a disc for which people had paid. It would have sparked a backlash, something that Divx was working very hard to avoid (which is why the DivxGold version of Mulan was not released).

The writer misses the point as to what a Disney moratorium is all about: to prod the consumer into purchasing a title or risk losing access to it.


Everything you do is surveyed Divx claims that their system will survey the consumer no more than that of an ordinary video rental store will do. This is not true. With Divx they will have to keep track every item from the day the item is manufactured until the Divx system is discontinnued. They will also know the exact hour you are watching the movie. As if this was not enough each disc is individually numerated so they can(well, they actually have to) track where you are taking the disc. National agencies will be lining up to get access to the Divx surveilance system. If a crime is commited in your area and you just watched a similar crime on video don't be surprised to get a visit from the police.

The rental tracking is a non-issue as far as this Webmaster is concerned. At least with Divx, the customer and credit card information were locked up in secure servers, with access controlled by ex-Secret Service personnel. With Blockbuster and other traditional renters, such information can be accessed by the low-paid, constantly-recycled part-time clerks, who are subject to minimal background checks.

The last point raised by the author here is just plain silly -- in Canada and the U.S., the only places where Divx could be used, such flimsy "evidence" would not provide a sufficient basis for probable cause or the obtaining of a search warrant. Satellite and cable pay-per-view are already tracking such information!


Only low end players Only the manufacturers selling the lowest quality players supports Divx. The first manufacturer to sell Divx players filed bankruptcy under Chapter 11 the 22th of May 1998.

The RCA 5231Z was and is an excellent entry-level unit, while the Panasonic and Proscan products were mid-range in their day (and the latter an especially good value). High-end players were only weeks away at the time of the Divx shutdown. In fact, the Webmaster came into possession a prototype JVC XV-DX1, which boasts component outputs (like the Proscan), onboard Dolby Digital decoder, and a host of bells and whistles; this unit was already showing up in online e-tailer catalogs when Divx marketing ceased. Also, a new high-end Zenith unit loaded with features and scheduled to enter manufacturing June 17, 1999, was weeks away from release. Several other manufacturers had new mid-range and high-end offerings in the works, aimed at the then-upcoming 1999 Christmas season.


Can't support the best extra material You will not have the cool extras that many DVD-Video titles will have when used on a computer with a DVD-ROM player. This because a Divx disc can't be played on any DVD-ROM players.

Divx is a rental system, not a collector format; the target market, VHS renters, has little interest in extras, and in fact, many people buy DVD discs with DVD-ROM features and don't even know they're there. And besides, now that DVD is a mass-market product with thousands of additional titles appearing on the format every year, more and more DVD discs do not come with such extras.


No price competition With Divx you will only be able to re-renting from one company. If the format gets accepted among the consumers they will have a monopoly and can set the prices without any competition.

Divx had a goal of capturing 15-20% of the VHS rental market, hardly what could be called a monopoly. Also, the big studios would never have permitted one company to control their home video releases. (Blockbuster's hegemony had caused them enough grief already.) Couple that with over-the-air broadcast, satellite and cable pay-per-view, and competition is aplenty.


No rare titles or special editions If Divx is accepted they will take over the market from specialised video stores who will have to close. The profit margin they can get from selling Divx discs are simply not enough for them. How many rare movie titles do you expect to find at the local grocery store if they start to sell Divx there? Contrary to the claims Divx will mean that the consumers will have less titles to choose from as it will kill nearly all specialzed video stores. Apart from less choice many jobs would also be lost.

Divx was not a suitable format for releasing catalog titles, which tend to sell in very low volumes.

Actually, many obscure catalog titles that would have otherwise languished in the vaults gathering dust found their way to Divx. There was simply no way that the revenues that many of these titles would return could justify the mastering and compression expense for DVD versions. With Divx versions, these expenses were the responsibility of DVE (which was anxious to get as many titles into the Divx catalog as they could, so the mastering costs weren't as big an issue), and the studios were paid up front for making their titles available for Divx release, in addition to getting a cut of the proceeds, so it was a win-win-win situation for them. And, a little known fact was that some of the MPEG-2 masters produced for Divx actually went on to be used in later DVD releases of those titles!

Therefore, it is fair to say that the availability of Divx resulted in a greater selection of titles on digital disc for consumers to choose from, with a much higher quality of presentation than the VHS and laserdisc versions that were the only other formats the copyright holders saw fit to release these titles on.


More spam Contrary to their claims the company behind Divx is already selling their address list for direct mail purposes. They also use the Divx player to send unsolicited commercial offerings directly to your Divx player so that they can be displayed on your TV.

Direct mail is a fact of everyday life for people in the U.S. and Canada; if one is not interested, one just tosses the offending correspondence in the recycling bin.

As for the Divx special offers, this is unlikely to have have become an issue; in fact, many would have considered it an advantage that they could get them. If not, it was quite simple to just select ERASE and get on with one's day, just as is done with e-mail spam.


You are in their pocket No information system is without errors. What if you find that you are charged for viewing a disc you know you have not seen the last month. How can you prove it to them? If you refuse to pay they may simply disable your Divx account.

In reality, Divx was a very well designed and reliable system; in two years of using it, with 5 players in 5 different households, and several hundred discs played, this writer never had a problem. Divx customer service was very adept at tracking what few errors came up, and coming to positive resolutions on them.


You will have to pay more and more What will you do when they start charging you a monthly fee for having a Divx account? Will you pay whatever they ask or will you throw away the film collection you paid for "unlimited" viewing of? (If you believe I'm just inventing this you should carefully read the Divx customer account agreement)

Although technically possible, this is just speculation. In reality, Divx never charged a fee for having an account, even to persons who acquired them after the phaseout period began. Divx intended to generate its revenues through disc sales, extra viewing periods, and DivxSilver conversions.


You better walk and talk like us To watch video if you have no credit(or bank debit) card or where you have no phone line? Forget it!

Having a credit or debit account is a normal part of everyday life in Canada and the U.S. Online renters like Netflix require the same, and even some brick&mortar stores want a credit card number for deposit in the event of theft of the tape or disc.

Phone lines, too, are something virtually every household in Canada and the U.S. has access to. In the extremely unlikely event that someone affluent enough to purchase a player and maintain an account did not have a phone line in their house, they could always take the player to someplace with a line (this would only have to be done every few weeks).


You have to follow your check and Divx account closely If your check account is not balanced when the automatic(and surprisingly high) Divx payment arrives then Divx may close your Divx account and you will suddenly find yourself unable of viewing the entire movie collection you have already paid full price for.(If you believe I'm just inventing this you should carefully read the Divx customer account agreement)

Most people keep their credit and debit accounts in good standing, so that was a non-issue. Also, it is likely that most people rarely bought extra viewing periods for their discs. Surprisingly high charges? The biggest one this writer ever got was $6.50, hardly a sum worthy of concern.


No long vacations What will happend if your phone line is not working for a period or if you go on a longer vacation and you are not willing to leave the player connected?

In that event, one reconnected the player to a phone line, and in a few minutes everything was back to normal. In fact, this was routine practice with three of the five players that were registered to this writer's account. But, if one is not going to be home, what's the problem with leaving the player connected to a phone line in one's absence, anyways?


The hookup is ready for more surveyance The system could also be used to monitor all DVD and CD titles you play on the Divx player. Even if the players don't do this today only a small software upgrade is all that is needed.

In reality, the Divx players had limited memory available, which had to be reserved for billing purposes. Upgrading players for this kind of monitoring would have required a replacement of their SP Modules with redesigned units, something that demands the physical intervention of a service technician.

Divx players could NOT track information about individual DVDs or audio CDs, other than knowing that a standard DVD or audio CD was being played. These discs carry no serialized ID, and therefore the player/system had no way to maintain and pass on individual information.


No moving over borders allowed If you move to another country your entire Divx movie collection would become worthless.

Divx was a Region 1 product that could be used in the U.S. and Canada, just like Region 1 DVD. The author neglects to mention how DVDs, too, are region-protected to prevent their sale for use outside a specific geographical area. Besides, Divx was a rental format, not a collector's format, and provided that none of a customer's titles were converted to DivxSilver, this would have been a non-issue.


Incentment to piracy People are not likely to accept paying each time they view a title they already have in their house. They could copy it to VHS using a macrovision buster. It would even be fully legal for the consumers to do this. How do you expect the studios to cover their loss?

Assuming that by "incentment" the author means "incitement", this statement is mere speculation. The truth is that Divx was a system that allowed copyright holders to enforce and safeguard their legal rights, not lose or compromise them.

Most renters have little interest in viewing a title more than once, and they would see no point to videotaping each and every one of their Divx discs when DivxSilver conversion or better yet, the DVD version, would be more practical options.


Not for movie collection What will you do with the collection of Divx discs you "own" if/when the whole Divx project is stopped? Do you expect that you can still watch a Divx disc you "own" 15, 10, 5 or even 2 year from now just as you can with VHS, Laserdisc and ordinary DVD?

That's correct -- Divx was a rental system, not a collector's format. Rentals are not permanent! With any titles converted to DivxSilver, after the phaseout period began customers had the option of a full refund of their DivxSilver conversion fees. With rental discs, they had over two full years in which to complete their viewing periods, an amount of time that is more than generous, and in fact it appears that customers who started additional viewing periods for their used discs in the last few months of Divx operation were not charged for them.


You may have to pay for others If your player is stolen and you don't inform the correct Divx instance in the right way or rapidly enough you "may be liable for payment to Divx for charges incurred from unauthorized use of your Player.".

On the contrary, this is a strong point of the Divx system, because it would allow police to track down where the phone call originated from. There is no comparable mechanism for theft recovery with a DVD-only player. Besides, why would anyone with a compromised account of any sort, Divx, credit, or what have you, hesitate in reporting it to the issuing agency?


There may be more coming... If Divx succeeds expect similar systems to be used for DVD-ROM and DVD-Audio. By releasing software only on a Divx system they hope to push the consumers into supporting this more expensive rental system.

Even though Divx was pulled from the market, other limited-access software systems are still in the works. Now that technology permits it, it is inevitable. Strangely enough, there has been very little debate on these newer systems, especially those concerning HDTV.


Dead when hacked No matter how impressive the encryption is there will always be a loophole. To modify a Divx player so it "forgets" it has played a disc should not be too big a challenge for many hackers. Expect such players to become mainstream in the USA and the rest of the world if Divx by any chance takes off in the USA. Remember that the Circuit City chairman Richard Sharp warned that early adopters were taking a risk. This is indeed true with Divx. If Divx is not killed right after the launch expect a new system called something like Divx-2 soon to be launched rendering the old Divx players outdated and the old discs unplayable.

Triple-DES encryption, used to protect Divx disc content, is currently unbreakable, and will likely remain so for the foreseeable future. In fact, the U.S. Government uses Triple-DES for sensitive documents, something they would never do if there were even the slightest chance it could be compromised.

Eleven years after Divx appeared on the market, the security protecting the Divx Secure Processor, the secure computer that drives the Divx playback hardware, has yet to be cracked (unlike the weak CSS of DVD). It is easy for someone to make broad statements about how hacking into the secure computer in a Divx player should be "not too big a challenge", but only the passage of time can determine if it is right or wrong. With that passage having occurred, we finally have an answer--it is just that, secure.