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Now Is the Time to Take Back Our Business

21 Sep, 2015 By: Thomas K. Arnold

The home entertainment business is beginning to make sense again. The emergence of Ultra HD appears to have galvanized everyone to once again to work toward a common goal, which is the same goal the studios have been pushing since this business began nearly 40 years ago: getting consumers to buy movies for on-demand viewing, at a nice profit.

The Blu-ray Disc Association wasted no time in drafting specs for the Ultra HD Blu-ray Disc, which will be the optimum way to watch movies with four times the clarity, and 64 times as many colors, as HD. Nearly 10 years after its launch, the physical disc is still unmatched in terms of quality and durability.

Within weeks of the BDA announcement in late August, Samsung and 20th Century Fox were first out of the gate with a player and movie titles. (See story, page 10) Samsung’s Ultra HD Blu-ray Disc player promptly won a rash of accolades from the technology press  at the IFA 2015 trade show in Berlin, where it was unveiled. As Tom’s Guide noted, “Streaming services come and go, but the UHD Blu-ray player will let you keep a permanent collection.”

Also in September, we saw the launch of Vidity, an enabling technology that lets consumers store their UHD content locally instead of in the cloud, and also easily move it around to various devices, from Ultra HD widescreens to smartphones. With each disc or download they buy they get a package of files geared toward all these various devices, for instant viewing anywhere, at any time.

Let’s face it — our industry is never going to put the Netflix genie back in the bottle. Reed Hastings and his crew came up with a brilliant concept, playing right into the twin “wants” that I believe dictate all human behavior: simple and cheap. Netflix was also able to hit the studios when they were down and offer them big bucks for catalog product, more than they were getting by putting it out on disc. The result, of course, has been a near-complete decimation of the catalog business — and a stern warning to studios that the content they value the most, the fresh new theatricals, must always remain in their control.

And the studios have done a great job protecting their new releases. The problem is, they haven’t done such a great job in keeping consumers interested in buying them. UltraViolet never lived up to its promise because it was a complicated process — further encumbered by Disney’s insistence on going it alone, with Disney Movies Anywhere. As the song says, “united we stand, divided we fall. …”

We now have an exciting new product, Ultra HD Blu-ray Disc, and it is incumbent that other studios follow 20th Century Fox’s lead and start announcing, and issuing, product — sooner rather than later. We also have Vidity, which not only eases the transition from physical to digital, but also immensely enhances the digital value proposition. Again, it is critically important that other studios join in and not proceed with their own proprietary variant.

The more I think about it, the primary reason home entertainment began to stumble and fall a decade ago was that it stopped making sense. At a time when the quality of the viewing experience should have been front and center, our industry kept getting distracted, first by BD-Live, a failed attempt to appear technologically cool at a time when few TVs were even connected to the Internet, and then by 3D, a perfect storm of a disaster (I remember buying a TV and no one knew which glasses I needed, not even the tech support guys at Panasonic!).

We’re at the point now where consumers are spending a little more than half as much on buying movies than they were a decade ago. Everyone’s tuning in to Netflix, studio home entertainment divisions have been bled dry of some of their brightest talent, and the TV folks are taking over, with OTT the mantra of the day.

And yet the opportunity to take back our business — selling movies to consumers — is now at hand. Let’s think long-term viability, not short-term profits, and do it right.

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