April 21^st, 2008 (9:51am) - Sony has been in ongoing talks with studios in recent weeks to finalize agreements for movie and television distribution through the PlayStation Network.

Sony has already failed twice in the digital distrubtion space with it’s MovieLink service, and Sony Connect, the company’s response to Apple’s market leading iTunes service.

"They’ve got to get a win in the digital, and I’d say on the electronic delivery side of the business," said Kurt Scherf, an analyst with Parks Associates who studies technology in the home. "That’s where the future is. They’ve got to establish a toehold in that space."

With 4 million PlayStation 3s in the US and 9 million worldwide, connected to the Internet, Sony would be entering competion against established players Apple with its AppleTV product and Microsoft’s Xbox 360 Live service.

Xbox Live already offers its 10 million subscribers access to 350 movies and more than 5,000 television episodes from prime time shows such as "Lost" and "Scrubs".

Digital downloads are still a small percentage overall of the movie and television market, with $23.4 billion being spent in purchases and rentals compared to just $95 million on digital downloads. By 2010 revenue from digital movie downloads is projected to be worth more than $6.4.