Toshiba Announces Strategic Partnership Strengthened to Expand Delivery of Digital Media via SD Cards

Toshiba Corporation announced that it would make an equity investment in MOD Systems Incorporated, a U.S.-based industry leader providing digital content delivery systems to the retail sector. Toshiba will invest USD 20 million in MOD Systems, in addition to a previous investment of USD 4 million made in September 2007, bringing Toshiba ‘ s total investment to USD 24 million.

MOD Systems provides retailers with a digital media delivery system that enables consumers to download digital content for burning to an optical format. In spring 2009, the company will expand its current music download system with a new system, bringing direct downloads of diverse entertainment content, including movies and TV drama series, into the retail sector. Consumers will be able to use SD Cards, the most widely used solid-state media card, to download the content for enjoyment in the home. MOD Systems is now in discussions with potential partner companies, including studios and other content providers, hardware manufacturers and retailers.

Alongside conventional packaged media, such as CDs and DVDs, more and more people are turning to the Internet as a source of content. As Internet-based delivery of music and video content to the home grows, Toshiba sees growing consumer demand for new ways to purchase digital entertainment. Downloading content to SD cards in retail stores opens the way to a new delivery service offering a wide range of high quality titles with fast download speeds and complete security. The potential of this highly promising business model persuaded Toshiba to invest in MOD Systems.

Most video content is today distributed on optical discs. The expansion of broadband infrastructure though, points to rapid growth in downloads of digital content for consumption in the home. However, high speed downloads of large data sources such as movies require a high-speed connection able to handle high bandwidth. And a successful business model delivering value to all parties involved demands technology for copyright protection and secure delivery. Direct download in retail environments fully answers these concerns. Downloading video content at high speed to an SD Card will offer consumers a quick and simple means to access video entertainment.

Toshiba will develop dedicated set-top boxes for the service that allows consumers to watch content on TVs, and also develop portable devices that will allow content to be viewed and enjoyed anywhere. Toshiba will also produce and market high capacity SD cards for the system. Providing this physical environment and assuring that it can be easily used by consumers is expected to promote expansion of MOD Systems ‘ digital media delivery service.

Deployment of kiosks and other self-service devices that will enable downloads to SD cards in retail stores will be delivered by NCR Corporation, another investor in MOD Systems. Video entertainment content will be provided by Hollywood studios and other major studios: 4,000 titles are lined up, and more will be available by the time the service launches. Initial downloads will be in standard definition (SD) content, and the service may also be applied to downloads of HD content in the future.