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It seems there's no doubt in anyone's mind that video on demand is going to be hot for Internet users. But in Europe, the real problem isn't whether somebody will make money, but who that somebody will be. At a conference in Montpellier, France, telecom operators and media companies got together to haggle their way through business models that will hopefully mean on-demand programming for us sooner rather than later. Sure, there have been a few smaller deals brokered recently, like those between between U.S. TV and film-rights owners like Warner, and European telecom operators such as Fastweb, Deutsche Telekom AG and recently with France Telecom. But programming is limited and neither camp expects big profits from this just yet.

For their part, media companies say they are concerned online video on demand could increase their exposure to piracy.
Internet peer-to-peer software enables millions of web surfers every day to download films for free, even though piracy protection technology has improved. Films rented from online distributors can destroy themselves within a few hours.

Obviously, this draws a parallel with the music industry, which faltered on its business models, letting Apple's iTunes gain a huge lead. I don't think anyone wants to see that happen again.

Firms haggle over video on demand [Reuters]