Walgreen sees movie-burning DVD kiosks at stores

By Sue Zeidler

LOS ANGELES (Reuters) - Walgreen plans to put kiosks that can make DVDs of popular movies in drugstore photo departments next year, using a new system that would increase selection while avoiding piracy.

Recent change in copy-protection rules governing DVDs have freed Walgreen and other retailers to tap this new movie market by letting consumers burn digital copies onto blank discs at stores, industry watchers said.

Walgreen and CVS have tried to attract more customers in recent years by offering improved digital photo kiosks, in- store health clinics and exclusive merchandise.

For studios, the kiosks add to revenue, particularly from older and more niche content selections, without having to manufacture, ship and store them.

"We hope to launch DVD-burning kiosks in the next few months. We think its a type of solution that will work very well in our stores, giving us the ability to provide a virtual inventory to a diverse customer base," said Tiffani Bruce, a spokeswoman for Walgreen, the nation's largest drugstore chain, with more than 6,000 stores.

Last month, the DVD Copy Control Association, a group of movie studios and hardware makers that oversees the copy protection system for DVDs known as Content Scramble System (CSS), moved to allow its technology to be licensed more broadly, opening the door for DVD-burning kiosks.

Now Walgreen is working with Hollywood studios and consumers will be able to make DVDs in about 15 minutes.

"We believe it could right for most stores," Bruce said.