Tuesday, March 4, 2008

Toshiba Loses Blu-Ray Battle, But are Discs Really the War?

The new video format wars came to an abrupt end recently as Toshiba gave up on the HD DVD format and accepted that they would have to move to the new Blu-ray format. The question may be asked, though, will consumers really care who won? I've been accumulating hardware to install an HDTV recently and going through potential support for storing content. One item that caught my eye: a one-terabyte (1,000 gigabyte) file server than can park itself on a wireless home network or a direct network connection. This little puppy will set me back all of about USD 550 online. That's about the going price for a Blu-ray disc player for a device that can store hundreds of movies, though certainly the Blu-ray disc devices can be expected to fall in price.

Nevertheless, with home servers becoming more and more economical, why would the entertainment industry dicker around with discs when in-home servers, on-demand cable movies and other service channels can ensure far more rapid delivery of content to interested audiences? Yes, it will provide in-store sales and help to introduce technophobes to yet another new media format, but isn't that a little bit like telling a blacksmith to keep on selling those horseshoes because you never know when those automobile people might get a hankering for using their old horse-drawn carriage again?

It seems as if the movie industry, like many other sectors in the content industry, is a captive of its traditional metrics. Faced with a new technology - HDTV - the movie producers said "Hey, now we can make more money on in-store disc sales - this is great." This of course locks them into a form of sales that's chasing yesterday's audiences: in an on-demand world of content, it's better to develop an on-demand system that can enable more people to respond to systems such as search engines and profile-matchers that can feed people the movies that would most interest them in the moment. If you can get a movie easily on an on-demand basis and it is priced to make it competitive with theatres, store sales and rentals at different points in its "shelf life" why would you focus so much energy on a format that will inevitably be the focus of piracy? In an economy in which our ability to enjoy libraries of old content stacked on a shelf is dubious at best, the rationale for disc sales has grown appreciably thinner.

Producers of all traditional media need to get far better at making their content discoverable and accessible in the venues that users value most. If I am on my mobile phone, make it easly for me to click on an icon or link when a movie is mentioned and queue it up for my viewing for the next five days. If I am reading a book review at a Starbucks, make it easy for me to go download it into my iPhone or to order a print-on-demand copy that I can pick up at Kinko's. Print magazine publishers floundered for years with getting their online models to work because they were unwilling to embrace similar basic questions of how to service their audiences. When Hollywood gets around to recognizing more clearly that they're in the audience serving business and not the film and disc distribution business hopefully they'll follow the lead of publishers who have already started to learn how to service their audiences the way that they like to be served. In the meantime that terabyte server looks like a tasty option to reclaim my bookshelves for...books? I don't know, now...
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