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Requiem for the DVD

5 Apr, 2006 By: Erik Gruenwedel

March 23, 2006. The day packaged media died. Call it “Dead DVD Walking.”

Universal Pictures International announced it would soon offer on the Internet in England digital downloads for purchase of major movies on the same release date of the DVD.

Less than 10 days later, largely moribund download services MovieLink and CinemaNow hawked similar rights (sans the DVD) to top studio fare on PCs in the United States.

Not to be outdone, HotMovies.com, an online adult entertainment site, launched Download-2-Own.com, which claims more than 35,000 streams paid for by the minute.

Some might argue the shot fired across packaged media's bow occurred some time ago, when cable TV began aggressively promoting video-on-demand and pay-per-view programming.

Big box retailer Best Buy in fourth-quarter filings reported a 4.5% decline in same-store entertainment software sales.

But not until the studios acquiesced to the concept of digital delivery did it really matter. And then, only on their terms.

Studios, as content holders, hold all the cards. They — unlike their piracy-addled music industry counterparts — decide what the channels of distribution will be and for how long.

Pundits and studio bosses may extol the virtues of next-generation optical-disc technology (Blu-ray Disc and HD DVD), and wring their collective hands when backroom antics among competing Japanese consumer electronics giants over respective technology patents and license rights help fuel consumer indifference.

But as the launch of high-definition packaged software and hardware languishes, the studios appear to be hedging their bets in a separate direction.

Although I didn't sense it at the time, a paradigm shift of how studios viewed their future occurred recently with the revamped Warner Bros. Home Entertainment Group. The unit's new president quietly opined supplanting the rental window with premium-priced VOD on Time Warner cable.

Window juggling? Perhaps. But the studios, if nothing else, follow a herd mentality toward the next big thing. And that is now the movie download. When the studios figure out a way to download content beyond the PC to the TV, the days of the DVD cash cow will be more than numbered.

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