Hollywood used to proclaim that “Movies are still your best form of entertainment.”

That it felt it necessary to do so was in reaction to its declining share of the entertainment market against the little box, television, where you could see things for free and in the comfort of one’s own home.

Hollywood assumed an adversarial stance against television right from the beginning, doing everything from encouraging stars under its control to stay off TV to changing the aspect ratio of movies so that they no longer matched the dimensions of the television screens. Yet think of how different things might have been, for television and for the Hollywood studio system, had the moguls of the 1950s decided that television represented not a threat, but a new outlet, a new source of profits in which everyone would have a chance to wet their beaks.

But they didn’t. They put more value on the short-term loss than on the potential for long term gain – and an already teetering studio system crumbled. And, after the ground finally stopped shaking and thanks to folks like MCA’s Lew Wasserman – the studios found themselves in the television business anyway. But they had to learn the lesson the hard way.

So you might think the next time the opportunity arose to tap into an emerging market that had the potential for big revenues, the studios would be the first ones in line. Guess again. As we all know from the famous “Betamax” case, the folks who produced movies and television entertainment were so concerned about the potential for abuse that they tried, essentially, to put a stop to home video recorders while overlooking the enormous profits to be made in movie rentals.

Fool me once, shame on you. Fool me twice, shame on me. But fool me a third time? The studios still seem to think that new technology, rather than being a source for additional profits, remains the enemy. Case in point: RealDVD, a product from Real Networks, the same folks who gave us Real Player and other interesting media applications for our computers.

As the company puts it, RealDVD is “a cool new product that lets you save your DVDs to your PC or laptop,” a way to get additional value from the DVDs you have already purchased. RealDVD is, in essence, a convenience in much the same way cassette tapes (remember them?) were a way to listen to the music contained on the LPs (remember them?) you had purchased while driving in your car.

RealDVD is not, at least according to RealNetworks, a tool for pirating media. The company says it has stringent protections embedded in its software to prevent piracy and illegal copying. And, truth be told, anyone interested in breaking through the piracy protections encoded into today’s DVDs so they can rip free bootlegs has more than enough shareware to choose from already that they don’t need a program developed by a for-profit company to make things easier for consumers.

But, just like they did with television and with home video recorder, the big studios have reacted with horror to the idea that something that might make it easier for consumer to get more life out of products, in this case DVDs, which consumer have already purchased, that they brought suit against RealNetworks to shut things down.

There are certainly real issues involved here. The protection of intellectual property is a very real concern, for producers and consumers alike. As is the matter of the assignment of rights for duplication, the definitions of personal use and the distribution of revenues that might be generated from what one can assume would be the increased sale of DVDs.

But the fact remains that the technology companies, RealNetworks among them, are looking to the future while the studios remain grounded in the present or, even worse, the past. DVDs will eventually go the way of the LP, becoming an anachronistic storage device of interest only to serious collectors. The Internet, and downloads, is where the future lies. Programs like RealDVD are part of the transition and it makes little sense to trying and keep it shut down. The smart move, from a business perspective as well as a technological one, is to follow where it leads.