Toys R Us to rent, sell kids’ movies via site

The Hackensack (N.J.) RecordOctober 5, 2012 

Toys R Us, which for years has done a big business selling videotapes and DVDs of children’s movies, is launching a sales plan for the digital age, a website where parents can rent or purchase more than 4,000 kid-friendly movies and television shows.

The website, ToysRUsMovies.com, went live Thursday, and the movies and television shows will initially be available for streaming and downloading on personal computers, Macs and Adobe Flash-enabled devices. Toys R Us plans to expand availability to tablet devices, TVs and Blu-ray players later this year.

The application for the site will be loaded onto the Tabeo, a tablet device Wayne, N.J.-based Toys R Us created as its exclusive version of a tablet computer for kids.

Toys R Us is entering the $750 million video-on-demand market with the launch, going up against established online movie sites like Netflix and the digital download services from Apple Inc. and Amazon.com Inc. Analysts and industry experts called the launch a logical move for Toys R Us, and said it could attract parents who want to use a site that offers only safe family fare.

“Even for families that have access to Netflix and other services, this looks like a nice way to get to curated content,” said Sean McGowan, a toy industry analyst for Needham & Co. Unlike Netflix, which itself announced a Just for Kids dedicated site for Xbox, ToysRUsMovies users will not have to pay a subscription fee, which is a plus, McGowan said.

“It’s a nice, logical add-on for the tablet, but they’ve (consumers) got to buy the tablet first,” said Chris Byrne, a toy consultant and writer known as The Toy Guy. “It’s going into a crowded and challenging market. More and more parents are giving up their cable and switching to Apple TV or some mechanism for downloading movies.”

Shelby Cunningham, an associate analyst for Digital Tech Consulting in Dallas, said the success of the Toys R Us movie site will depend on whether the company gives people something different. “Parents can already go on iTunes or the Disney site and download movies,” she said. “They have to make it easier for people and unique in some way.”

The asset for Toys R Us, Cunningham said, is “they have an audience. Toys R Us has been around forever. That helps, having a built-in audience to sell to.”

Michael Scharff, senior vice president, new ventures, at Toys R Us, said the company has been discussing creating such a website for some time, as “we’ve seen the DVD business shift to digital, much like music and books have over the years.” The ToysRUsMovies website has been in the works for about a year, he said.

The company will be promoting the new website as part of its store advertising campaigns and also will promote it on its social media sites and with in-store displays. Movies will be priced starting at $2.99 for a 24-hour rental and $5.99 for a digital download. Most television shows will cost $1.99.

Scharff said Toys R Us hopes to eventually use the site to offer exclusive content through partnerships with movie studios.

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