Downloads Likely Won't Kill the Disc

9 Mar, 2008 By: Thomas K. Arnold

The end of the format war was met with a spate of articles in the mainstream press questioning the extent of Blu-ray Disc's victory. The articles were based on skeptical analysts who believe packaged media is doomed regardless, that before too long everyone will be downloading movies just as they are downloading music.

I don't buy it. Music and movies are two entirely different beasts, and just because the music industry went to downloading within a few short years doesn't mean the home entertainment industry will do the same — not in two years, not in 10 years, maybe not even ever.

Here's the rub: We've never bought movies the same way we've bought music. Music has always been bought by the song, whereas with movies you buy the whole thing, not a scene here or a scene there. The music industry nailed its own coffin shut by first killing off the single, and then raising CD prices above $20. Consumers no longer had an affordable way of sampling music, so they rebelled — and the fruits of their rebellion were the original Napster and other file-swapping mechanisms. After initially fighting the download phenomenon, the music industry ultimately relented and developed a pay model. At the same time, CD prices were brought back down to Earth. But by then it was too late: Consumers were burning and sharing their own CDs. They may buy plenty of 99-cent songs, but overall spending on music is way down.

Now let's look at the digital downloading of movies, which began in earnest about two years ago when the major studios began offering their big movies over the Internet. The business never really took off because movie prices are comparable to DVDs.

Moreover, the quality of downloaded movies is roughly on a par with VHS — fine for iPods and maybe laptops, but certainly not the massive HD screens we're now buying. Downloading a movie in true high-definition takes 10 hours. Even if that process were significantly sped up, there's still the hassle of somehow transferring it to an HDTV.

I predict we're going to see two parallel home entertainment business models emerge: a packaged-media model with top-quality picture and sound and gobs of special features, and a download model for quick iPod viewings. And with the enormous profit potential of Blu-ray Disc, and major studios such as Fox and Warner including digital movie files on discs, don't be surprised if movie downloading never really takes off.