We all know that the PS4/XB1 are basically melons when it comes to simple media playback. With everything kinda put behind one service or the other. So take for instance the only way I can watch movies on my PS4 is to put in a blu-ray movie (honestly can't remmeber when last I even saw one) or download from their store or netflix or insert any other media service here. And the same can pretty much be said about the XB1. So this got me thinking about an alternative distribution model for movies.

Ad supported movie playback

• Firstly, the PS store will have practically every movie ever released to date.
• Now more importantly, as long as you are a PS+ member, every single movie in the store will be FREE. You don't pay a dime for anything. And you have the option to stream or download them. This ssytem can also work even if you aren't a PS+/XBL subscriber since the money is made from the ads and not your subscription status.
• The movies will be DRM'd to the max, basically the only thing that will be capable of playing them will be the console. However, if you opted to download it on the console you can stream it to any connected device.
• While watching any movie, there will be four 15-30sec unobtrusive ad slots that will appear and then disappear somewhere on your screen spread out across the duration of the movie. It will also appear whenever you do things like increase/reduce the volume, pause the movie..etc. Look at the pics below for reference.
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• Now from every viewing of any movie, around $1 worth of ad revenue is generated. Think 25c per 15/30sec slot. 4 slots per movie so $1. 
• Being that the actual movie download/stream is free to everyone and in 1080p 5.1 surround at least or even 4k..... it basically means everyone will watch way more movies than they ever had. Even digging into older titles just for the hell of it since they aren't paying anything. 
• With this, if sony/MS has a combined install base of 150M users at some point, it will actually be possible to have certain movies being watchs by as many as 50-80M people. Which in turn is equivalent to $50-$80M generated ad revenue.
• This will also probably bring an end to piracy as we know it.
• In addition, the system can even let you play pirated movies. you can steal a movie all you want, you will actually be doing sony/ms a favour as they wont have to cover the bandwidth cost for that movie. The system however won't play the movie unless it has a name and release year. Once you play it, the ads still pop up. everybody is happy.
• Something similar can be done for free to play games. Think  flash banners in an online lobby, or in fighters while they are announcing the round of a fight.
• Lastly, you can always just pay for the movie if you don't wanna see ads.

So what do you guys think, is something like this feasable and ingenious meaning that the guys that make these decisions are fools to not have tried something like this yet. Or are there some major hurdles and issues I am overlooking. Would something like this be something you are willing to do or support?

edit: added italized point.

Damn that's a grand scheme now they just need the guts to try it! I know I'd love it!

I would love something like that! HuluPlus also have an interesting alternative for some of their series. I can choose to have some four commercial breaks during an episode or to watch a three minute long commercial ahead of the episode, and then I will get no more commercial.

Overall, there should be one service that contains all movies and, preferably, all series.

Your math is a bit off, since you are assuming 150M users will have PS+/Gold subscription. Second, you are assuming that they will all be in the US, but it's more likely that a combined total of 50M users will be US based. (This because licensing outside US is done on individual country basis, and they would have to deal with hundreds of distributers WW). And US users already massively use Netflix for a reasonable monthly fee.
Otherwise, I can see that some people might take advantage, but I'm thinking more 5-8 million total, not 50-80M per movie.

Other thoughts, ad placement etc. seems plausible.

I don't know...
25 cents per ad, to reach one person is a lot! That means, advertisers will pay $20 million dollars to reach 80 million people. That's way too much. The Superbowl which has the most expensive ads slots every year, is watched by 110 million people and charges $3.5 million for a 30sec advert. TV advertising is just much better value compared to the prices you mentioned. Plus this is a new concept, so movie studios will have to convince advetisers about this. So in the beginning ad rates will be very low. Probably less than 1 cent per ad. 

Oh I know there are a myriad of legal issues to overcome when doing something like this. But in truth those aren't really that big when you consider that its not an app or service but rather a distribution guideline. It shouldn't matter where in the world you are, when a movie is licensed to be shown in your country, it will be on each platforms respective store.

User money isn't changing hands, ad revenue is only going between the platfomr holders and the content owners. As ong as a content provider is licensed to show/sell their content in any particular country then they are also covered hosting their content on the PS4/XB1. And its not like this ting will just happen overnight.

And my PS+/XBL numbers aren't too off. I am basing it off a possibility that the benefits that those services will offer, in addition to this free movies service will be som vast that most people will buy the consoles just to get in on the services. So there will be like an at least 90% sign up rate. Like saying, you want 10% discount on every purchase, free games every month, free unlimited access to movies, online multiplayer..then get PS+/XBL.

In an ideal situation, this would ultimately mean that at some point with as much as 150M combined users worldwide, at least 100M of them would be signed up to the service. 

Another way to look at legal issues regarding these movies, is that the movies themselves literally become like websites. There are no laws in the free world restricting which website you can go to or not or which ads you are exposed to or not. Legal isues really only come into play when money physically exchanges hands.As long as the end user pays nothing, no one can really tell you what to watch or not watch.

You can stream movies and shows from your computer to your Xbox. Paying and blu-ray are not the only ways. Plus with app services like HBO GO, MTV, Nick, FXNow, Showtime and much more, theres plenty of outlets for tv and movies.

Not really.... it wouldn't work that way.

Advertisers will not be paying for each ad on a per user bases. The will be paying for general ad slots. Meaning, an advertiser will  pay $2M for 2 thousand ad slots. But any one of those 2 thousand ad slots could be shown to as much as 30M people. 

The system balances out cause thousands of advertisers are paying $500k to like $2M every year for ad slots. Sony/ms collects all that money and passes it onto the content provider at the end of the year.

So basically, take the matrix movie by warner bros. There are 4 ad slots in each movie. each slot is worth 25c to the content provider (warner bros). You paying for an ad just means that you apy for like $1M for say 1000 slots. each individual slot can be seen by as much as 20M individual users depending on who is watching what and when when. If somehow 10M people watch the matrix movie, then each viewing has generated $1 in ad revenue from different ads. 

That is not the point of this thread. I am talking about a possible distribution method. one to surpass everything that we are using today and that doesn't require the end user paying for anything or paying for any number of monthly services. 

I personally think if something like this is done, there will literally be no need for any other kinda movie service outlet.

Ah right. But then with this system, there is no way a movie can generate $50-$80 million in revenue.