Last week’s Hollywood Reporter has yet another excellent story (Variety who?) looking into the many fascinating details of where digital technology is currently taking home video — a subject I’m even more obsessed with than Jon Stewart. Powered mostly by the raging success of Netflix’s streaming video service — a concept too undeniably popular for Hollywood to ignore for even a second longer, the latest idea is to create a hybrid that offers the beauty of digital streaming with the all-important revenue created by DVD purchases that are so vital to the entertainment industry’s bottom line. The current digital purchase model is ludicrous.
As it stands now, the price of purchasing a digital copy of a film from, say, Amazon (that you have to store on your own hard-drive), is practically the same price as a new hard copy, double the price if you’re willing to wait a month to purchase the previously-viewed hard copy and triple the price of waiting six months to purchase it out of a bin at Walmart. With Obama determined to tank the economy, people are thinking these kinds of purchase-points through today. There’s also the sad fact that movies themselves just aren’t as good as they once were. Regardless, Hollywood finally appears to have figured out that this digital business model isn’t attracting enough customers and is now developing an idea that sounds somewhat promising. See if you agree.
They call it UltraViolet, and a number of heavy-hitters, including Netflix and Microsoft, are teaming up to bring it to fruition this year (what a time we live in):
[S]tudios are also terrified of the trend toward renting streaming media rather than purchasing it. Consumers wonder why they should buy digital movies for what they’d pay for a physical DVD that is loaded with extras. To sweeten the digital deal, Sony has introduced some enhancements: a search function that uses facial recognition and speech-to-text software; Clip & Share, allowing viewers to share clips on Facebook and Twitter; and an interactive music playlist that links to movie scenes and the iTunes Store.
“We are trying to take advantage of the digital platform to provide an enhanced experience,” says Rich Berger, SPHE senior vp digital. “We think this makes it more collectible.”
Beyond sale-enhancement experiments, what the studios are looking toward is UltraViolet, a service launching this year. You buy a movie digitally, and it is stored in a locker that resides in the so-called “cloud.” It could replace DVDs as thoroughly as music downloads have replaced CDs.
UV is being built by the Digital Entertainment Content Ecosystem, a consortium of more than 60 leading companies. DECE’s members include most major studios, LG, Samsung, Microsoft, Best Buy and even Netflix.
UV’s key is in making the purchase and storage of digital media as easy as buying a DVD and throwing it on a shelf — no complicated rules and access to your library wherever there’s an Internet connection. Down the road studios should even be able to blast updated digital extras to movies that are stored in the cloud so they can make the claim that the cloud doesn’t diminish the value of your collection, it enhances it.
One challenge for UV: Disney and Apple’s iTunes have not signed on. But if UV can persuade movie lovers to purchase some of their favorite films digitally rather than merely rent them, studios can worry a lot less about a DVD industry that has been shrinking for four consecutive years.
Other than saving shelf space, I’m not entirely sure of what the advantages are to purchasing a digital copy unless it’s a whole lot cheaper. I like the hard copies and I don’t think I’m alone. There’s something about gazing at that wall of treasures that’s immensely satisfying. The comparison to iTunes or digital music in general isn’t a perfect one, either. One of the reasons digital music downloads are so appealing is that you can buy one song at a time as opposed to paying for an entire album, which is usually packed with cuts you’ll never listen to. There’s also the convenience of being able to take your music collection with you on a device smaller than a credit card. We don’t watch movies the same way we listen to music. At least not yet.
Essentially, if you want to boil it all down to a Hollywood logline, UltraViolet sounds a lot like iTunes but with film and television episodes. The stakes with UltraViolet are enormous, as well. Unless Hollywood can figure out a way to get us to buy movies again their entire business model is going to have to change. Movies very rarely achieve profitability at the box office. DVD sales have been what takes them over the top and the industry has operated for years as though this is just a given. We’re already seeing the consequences of that no longer being a given in the form of fewer films being released and a 7 month summer season packed with sequels, remakes, and franchises. But everyone know the public is growing weary of films directed only at teenage boys (who are no longer predictable ticket-buyers, either) and then what does Hollywood do?
I suggest you read the whole article, though. What I focused on is actually an afterthought to look at how Netflix is increasingly under fire — in a good capitalist way — now that others are jumping onto the streaming bandwagon. The Big Question is no longer Is streaming is the future?, the question is whether or not people will be willing to subscribe to multiple streaming services. Like HBO, Showtime and Starz operate now, if we as consumers want access to everything streaming online, it appears as though we’re going to have to pay more than one provider.
Let me close by making a political point: Look at the marvel of electronic and digital technology today; look at what happens when government gets out of the what and lets the innovator’s innovate and the competition compete. Not only has the product improved exponentially in my lifetime (I remember when my family bought our first color TV), it’s also so affordable that almost everyone has a hi-def television with surround-sound and a Netflix subscription.
Imagine if this innovation and competition was allowed to be unleashed in public education and health care. There’s no reason to be believe the results wouldn’t be similar and yet we keep pushing those vital and necessary services in the exact opposite direction.