Jun 18, 2008
Posted by: Hitsville

The digital future: A Fantasia, with swearing

I’ve spent part of the last few days pondering a long LAT story on the movie industry’s ever-evolving home video plans—the nexus of DVDs, Blu-ray, on demand, etc. etc.

I wanted to get all the varying strands of the plans straight in my head—Disney tinkering with DVD release windows, Netflix’s new download box, the slow growth of Blu-ray….

Then I realized something. I didn’t want to get it all straight.

I didn’t care.

The problem with every one of the plans now under way is that they are about what the studios or cable or computer companies want to do, or what’s good for them.

The solution is to give consumers something that’s good for them.

I think the papers should turn the coverage around. The stories shouldn’t be about what Fox, or Apple, or Comcast, want to do. They should be about whether what the companies are doing measures up to what people might actually want or use.

After more than a decade dealing with all of the different entities that have provided me with media—various species of cable and satellite and ISPs, Netflix and the iTunes Store, Kozmo and Hulu, and all manner of other crude on-demand and pay-per-view services—I’ve pretty much reached my limit. So I thought about what I wanted, and came up with a helpful précis of what the benchmarks should be for digital distribution of movies and TV shows:

  1. I want to choose movies or TV shows to watch, when I want, from my TV screen. I want complete histories of shows (not just the most recent seasons, or part of the most recent seasons, or just some random, haphazard samples), and complete filmographies of directors and stars. (I really don’t care, by way of example, that Woody Allen didn’t make Take the Money and Run for United Artists, and it’s not part of the UA package. If I’m in the mood to watch an early Woody Allen movie, I want Take the Money and Run on the list.)
  2. I want a selection system based on a large database, with accurate capsule descriptions and intelligent keywording. I want it all done on an open system to allow networking with other movie and TV fans and browsing other folks’ recommendation and reviews.
  3. The database should be arranged on long pages and coded to preload, so paging through choices doesn’t involve five- or ten-second-long delays each time you hit the “next page” command.
  4. The download should start immediately and shouldn’t be delayed with promotional crap, bullshit corporate logos, legal enunciations, FBI warnings, previews, or anything in French.
  5. The viewing window doesn’t have to be indefinite. Let’s be reasonable. You aren’t always able to watch a given movie in one sitting. Six months—that’s reasonable. If I pay five bucks to watch a movie, I should be able to have it around for six months.
  6. If I buy the movie for download, I want the DVD extras, too, all accessible as the movie is playing, so I can switch easily to the filmmakers’ commentary, for example.
  7. Ixnay on the oxes-bay. (NetFlix and Apple, please take note.) I don’t want to attach another damn cord to the TV set, and I certainly don’t need another fucking remote. The studios and cable companies should agree on an open-standard cable box that will incorporate a new universal download system and not require me to use up another HDMI plug. (Many households are already juggling cable boxes, video game consoles and Blu-ray players.) Create the service, create the standards, and incorporate it into the cable box.
  8. Integrate the on-demand service with cable such that it doesn’t take three minutes and the pressing of nine different buttons to stop watching a movie and check CNN for a bit. The system should be designed to be used in real-world conditions.
  9. Do all of that, and then name your price. I’ll pay it.

The problem with this fantasy is that it requires all of the companies involved to play nice with a view toward making things easy on consumers. How they do it I don’t care, but it’s hard to envision the critical mass that all of the industries, collectively, need occurring if they don’t.

May 29, 2008
Posted by: Hitsville

Apple thumbs its nose at NBC

… by allowing HBO to charge $2.99 an episode for those of its shows that just joined the iTunes Store lineup, the Hollywood Reporter says:

NBC took The Office, Heroes and all the rest of its shows out of the iTunes Store last year, mostly because Steve Jobs wouldn’t let the company charge more than $1.99 for an episode. Or so it seemed at the time. The HR story has a lot of new information on the dispute:

[…S]ources also suggest that it wasn’t Apple but NBC Uni that was being stubborn in their previous negotiation stalemate. Not only was NBC Uni pushing to test a $4.99 price point—suddenly, “Sopranos” doesn’t seem that expensive—but it also wanted to institute dynamic pricing, an experimental new technology that recalibrates price based on consumer demand. NBC Uni declined comment on dynamic pricing, which is being tested by Warner Music Group.

The story also details more of the complex dynamics behind the scenes as companies try to balance competing revenue streams—and the implacable Jobs:

Even if a program’s popularity was key to setting its price, “Sopranos” hasn’t proved particularly popular in its first few weeks on iTunes — perhaps because of the elevated price point. It is ranked 24th among season packages on iTunes; among individual episodes, “Sopranos” didn’t even crack the top 100.

No doubt Showtime might want to test the $2.99 waters not only because it shares HBO’s premium status but also because its series “Dexter” is currently the most popular full-season order on iTunes.

If sales ends up driving pricing, shows that aren’t necessarily big on-air hits but are iTunes darlings could command higher prices, including the CW’s “Gossip Girl.”

However, one conglomerate exec believes that Apple might have its own opinions on programming value. “When you get into that conversation, it’s a slippery slope,” the exec says. “Because we’ll differ with them on what content is worth what.”

If anything is indicative of a show’s iTunes price, look at the digits appearing on its DVD price tag. HBO in particular has a massive DVD business, and with that comes the need to maintain a higher price in order to afford some protection from cannibalizing DVD sales.

But variable pricing is only part of what content companies want from iTunes. What one might call variable packaging is high on the wish list as well, which means the ability to bundle multiple titles in creative ways—for instance, selling a film and its soundtrack together for one discounted price.

Another question altogether is whether Apple also will adjust revenue splits—known to be in the neighborhood of 70-30 with the content companies—once pricing changes. Not likely, most say, and beside the point for Apple. Content isn’t seen as much as a revenue driver in and of itself as it a catalyst for more significant dollars that come from sales of iPods and AppleTV devices.

May 29, 2008
Posted by: Hitsville

Life imitates Onion. (One in a continuing series.)

Blockbuster yesterday unveiled a device with which customers can download movies in two minutes …

… onto a portable device they bring into the store.

Cnet offers the ridicule you’d expect here.

Reasoning this out, you have to figure Blockbuster did some research and either found that or is just hoping that there is a market for people without broadband in their homes who wanted, for some reason or other, to enjoy the novel experience of quote-unquote downloading a movie …

… and in theory, if the device catches and became familiar, the company could conceivably have them everywhere—7-Elevens and so forth—with lots and lots of movies available. (The company said it was aiming for a thirty-second download time.)

The troubles with this line of reasoning, however, are legion. For the first, if you don’t have broadband, are  you going to be the type of person who feels comfortable toting around a hard drive and repeatedly hooking it up to and dehooking it from your TV?

Second, if you’re already schlepping to the video store, who wants to carry along an electronic device? Isn’t it easier to just, you know, rent a DVD?

And that brings up the real motivation for the service. It’s a way to make it easier for Blockbuster and the studios; no running out of discs (even though they cost pennies to make), and one assumes the devices would be DRM’ed within an inch of their usefullness.

Convenience for corporations versus convenience for customers. In this day and age, what could possibly go wrong?

Apr 18, 2008
Posted by: Hitsville

The NBC vs. Apple war continues

Digital developments come so fast that it is, in the end, understandable why so many execs can be found saying senseless things. Even if you get one part of the equation, plain old ignorance (or corporate moneyminders above) keeps folks in a rut.

(I’ve seen this phenomenon a lot in places I’ve worked. Favorite example: The news exec who intoned to an assembled staff meeting, “We’re not getting Blackberries!” He then went on to announce that the company was going to hire some consultants—at who-knows-what cost—to analyze the news division’s reporting procedures in the digital age. Six months later, the consultants report came in. Task Item No. 1: “Reporting staff needs Blackberries.”)

Anyway, with the National Association of Broadcasters meeting next week, NBC Universal’s top digital officer, George Kliavkoff, is making news with just this sort of thing. On the one hand, there are noises coming from NBC Universal that the company would be looking into making Hulu available on cellphones. It’s pretty vague as yet, but the notion is out there.

Why? Well, here’s an AP story on the effects of debuting the premiere of a new episode for free online:

CBS Corp. executives took an unusual risk last fall before its series debut of “Big Bang Theory” — it offered the entire episode online despite the chance it would sap viewership for the TV premiere.

The show, about two geeky physicists and their beautiful female neighbor, got 90,000 views on CBS.com and other Web sites over a week, followed by a better-than-expected 9.5 million for the Sept. 24 on-air premiere.

(The story as a whole is a good overview of the state of the ad industry online for the networks.)

But there are still huge logical flaws. For example, Kliavkoff told Fortune that making video available online combats privacy:

Hulu offers users “all the value of aggregation, one-stop shopping for premium content,” Kliavkoff said. At the same time, he thinks it will reduce the illegal exchange of the content on peer-to-peer networks. “The best defense [against piracy] is providing a legitimate place for people to enjoy the content,” he said. For example, if NBC can post the latest episode of “Saturday Night Live” one minute after it’s finished airing, as happens with unauthorized posting on YouTube, viewers are more likely to watch the authorized stream.

Which is fine, except that NBC still isn’t making the video available for a move to one’s iPod. That’s where the piracy roars back in. In the digital age, if data can be moved, it will, whether NBC’s top digital officer wants it to or not. So kids will just torrent the show and stick it on their iPods.

… Which brings us back to the network’s war with the iTunes store, which it left in a huff last year because Steve Jobs wasn’t letting the company making its wares—what was the word?—more “attractive”—for its consumers. (Making prices “attractive” and “flexible” in NBC-speak is synonymous in normal English with “higher.”)

Now, over at Cnet, Kliavkoff is saying that the real issue with Apple is piracy. From an onstage interview at the Ad:Tech conference in SF, Cnet quoted Kliavkoff thusly:

“If you look at studies about MP3 players, especially leading MP3 players and what portion of that content is pirated, and think about how that content gets onto that device, it has to go through a gatekeeping piece of software, which would be a convenient place to put some antipiracy measures,” Kliavkoff said in an onstage interview at the Ad:Tech conference here.

In case you didn’t get the reference, he’s talking about Apple. Maybe I’m missing something, because the tech sites aren’t making a big deal about this, but Apple does have DRM restrictions on its video. With some tweaking you can move video files (along with anything else) around on an iPod, but even that way video from the iTunes Store doesn’t play on non-authorized computers. Kliavkoff seems to be upset that one download can be moved to more than one iPod (though each one needs to already be tied to the main computer), but in real life that’s too awkward for it to be a big piracy generator.

Mar 06, 2008
Posted by: Hitsville

“Flexibility” raises its ugly head again

A few weeks ago, we saw how, in the dispute between NBC and Apple, the word “attractive,” when it came to the price of NBC shows on iTunes, was a convenient synonym for “higher.” Back then, “flexible” was in the mix as well:

“Our negotiations were centered on our request for flexibility in wholesale pricing, including the ability to package shows together in ways that could make our content even more attractive for consumers.”

Emphasis added. That was an NBC flack, nattering on about how Steve Jobs wouldn’t budge from his uniform pricing policy on iTunes. My point at the time was that the press wasn’t challenging or reinterpreting those euphemisms.

Today, Variety, which should know better, is now incorporating the euphemisms into the reporter’s copy. Here’s Scott Kirsner, covering a Jeff Zucker appearance at the Harvard biz school:

He seemed chagrined at NBC U’s dealings with Apple. Last year, the Peacock pulled its TV shows from iTunes after a dispute over pricing — the company wanted the flexibility to offer hot shows at slightly higher prices than Apple’s standard, and library content at a discount.

The company didn’t want flexibility; it wanted to charge what the market would bear. Jobs’ argument is that that approach was short-sighted. Variety’s version is too Universal-friendly by half.