The report, which first appeared on the popular Boing Boing blog and picked up by a technology news site, said the digital rights management technology that prevented the DVD from being copied also made the movies unplayable on many commercial DVD players. The story quoted an anonymous optical disc R&D engineer who claimed to have examined CinemanNow's technology, called FluxDVD developed by ACE GmbH.
In an emailed statement, the online movie service denied the claim, saying the burn-to-DVD service launched last month has been "well received by our customers and studios alike."
"The system has been extensively tested for compatibility on standalone players and works on most players that can play a recordable DVD," the company said. "We cannot address vague assertions of flaws in the system except to say that if there are individuals for whom the solution is not working effectively, we encourage them to contact our customer support team so that we may help them resolve the issue."
A company spokesman said tests showed the DVDs worked on "94 percent of DVD players," and CinemaNow had not received complaints from customers or movie studios since launching the service.
"It's completely contrary to the experience all of these constituents have had," the spokesman said. He also questioned why the engineer making the allegations chose to remain anonymous in releasing his findings.
The launch of the CinemaNow service was newsworthy because it marked a loosening up by Hollywood in distributing movies over the Web. Studios have been reluctant to license their content without the assurance that it can be protected from illegal copying.
CinemaNow only offers for burning about 100 movies and videos, which is a tiny fraction of the participating studios' libraries. They include Buena Vista Home Entertainment, Lionsgate, MGM Worldwide Digital Media, Sony Pictures Home Entertainment, Universal Studios Home Entertainment, EagleVision and Sundance Channel.
CinemaNow, founded in 1999, is privately held. Investors of the online movie service include Menlo Ventures, Microsoft Corp., Lions Gate Entertainment, Cisco Systems and Blockbuster.