March 30, 2005 5:22 PM PST

Hollywood seeks iTunes for film

SANTA MONICA, Calif.--Sony Pictures Digital Entertainment is trying to develop and own the next iTunes--but for films.

"We want to set business models, pricing models, distribution models like (Apple Computer CEO Steve) Jobs did for music, but for the film industry," Michael Arrieta, senior vice president of Sony Pictures, said at the Digital Hollywood conference here.

"I'm trying to create the new 'anti-Napster,'" he added.

To that end, Arrieta said, his group plans to digitize Sony Pictures' top 500 films and make them available for the first time in various digital environments within the next year. He said the distribution for films like "Spider-Man 2" will go beyond just Movielink, the video-on-demand joint venture of Sony Pictures and several other major studios, which to date has hosted a limited library of Sony's movies.

For example, Sony plans to sell and make films available in flash memory for mobile phones in the next year, Arrieta said. It also will further develop its digital stores for downloading and owning films on the PC, he said in an interview.

Sony's plans--and similar moves by other studios--are likely to avoid empowering any one technology company--such as Apple in the music equation--and allow studios to pocket more of the profits. The philosophy in Hollywood is "Define your own agenda or someone else will for you."

Equally important is trying to avoid the rampant digital theft in peer-to-peer communities that the music industry has suffered, media executives say.

At the Digital Hollywood conference--a three-day event that began Wednesday--media executives including Arrieta ruminated on ongoing hurdles to giving consumers access to unlimited films, TV shows and multimedia on a range of devices, anywhere at anytime.

They agreed that issues surrounding digital rights management, consumer adoption, and simple and compatible consumer electronics remained bottlenecks in the industry.

Still, Hollywood is working with technologists to help deliver the promise of the "digital home" more than ever before, according to entertainment executives. It's just that the two sides may still be speaking different languages.

"The plumbing of IT is converging," said Adam Bain, vice president of technology and production at Fox Sports Interactive. "But there are so many different devices the trends are of a divergent nature."

Advertising's future
Media executives during the "Digital Home" panel also discussed the future of 30-second TV commercials in a digital environment that lets consumers skip over the ads.

Charles Swartz, executive director and CEO of the University of Southern California's Entertainment Technology Center, said that because ads are the most effective sales tool ever invented, they will not disappear. But, he said, there's an opportunity to customize and target the ads to people's homes with advanced technology.

"Commercials aren't dead; they'll just get more interactive and effective," said Shahid Khan, managing director of Bearingpoint, an entertainment consulting firm. "But someone has to figure out how to better measure this animal."

Whatever the case, entertainment, advertising and technology will increasingly meld into a seamless product, executives say, and it remains to be seen who will be the powerbroker. Sony Pictures, whose parent company develops a wide range of consumer electronics, reiterated that it's trying to set its own agenda for new entertainment distribution.

"The future is about creating an entertainment ecosystem," in which players, platforms, content rights and the user interface are fluid, Arrieta said. The industry's "in a transition period, but there's a high-level dialog (with technology partners) going on now."

14 comments

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Let Apple Do It
Ok..

So Apple has a nice track record with music, have been
streaming trailers for years, and they have the technology to
deliver as well. QT looks better then WMP and is used in many
more professional editing programs, so it just seems like a
natural thing to do.
Posted by jltnol (85 comments )
Reply Link Flag
who better to do it?
i think apple would do a great job of distributing movies in the style of iTunes. they have done a fantastic job with that program and service as a whole. they've shown their programming superiority in building programs for multiple platforms.

but this time around i'd like to see a linux client.

note:while QT is better than WMV, the file sizes are greater. maybe that's just the price of compatability. it's not like people who will be downloading movies are going to have storage or bandwidth problems.
Posted by Dibbs (158 comments )
Link Flag
Let Apple Do It
Ok..

So Apple has a nice track record with music, have been
streaming trailers for years, and they have the technology to
deliver as well. QT looks better then WMP and is used in many
more professional editing programs, so it just seems like a
natural thing to do.
Posted by jltnol (85 comments )
Reply Link Flag
who better to do it?
i think apple would do a great job of distributing movies in the style of iTunes. they have done a fantastic job with that program and service as a whole. they've shown their programming superiority in building programs for multiple platforms.

but this time around i'd like to see a linux client.

note:while QT is better than WMV, the file sizes are greater. maybe that's just the price of compatability. it's not like people who will be downloading movies are going to have storage or bandwidth problems.
Posted by Dibbs (158 comments )
Link Flag
Finally they start to think
I think it is brilliant that finally a media company is starting to think with the public instead of against it.

Looks like Sony has realised that they can't put the genie in the box and might as well provide a good service for the online movie consumers.

With good encryption and subscription based downloading I can see a near future where for a small fee (maybe even included in your EverquestII account) you can download X amount of movies to keep, or X amount for "renting" that will selfdestruct after a month.

And not having to wait bloody ages when downloading a movie only to find out it is Tommy Lee and Pamela romping about again. Most of us want to be legal me thinks, just not paying through our noses while being legal.

Of course this will be compatible with the PSP and have the ability to be burned on a DVD.

But only 500 movies? I want the old stuff that you can't find in any shop. Bad horror movies from the 70s and 80s, ability to download all movies and series starring a certain actor or made by a certain director. Not to mention this is the perfect vehicle for all Manga fans out there.

Streaming won't suffice though. Someone calling me on my IP phone would crap the bandwidth right up.
Posted by Daniel Londonsvenskar (7 comments )
Reply Link Flag
Finally they start to think
I think it is brilliant that finally a media company is starting to think with the public instead of against it.

Looks like Sony has realised that they can't put the genie in the box and might as well provide a good service for the online movie consumers.

With good encryption and subscription based downloading I can see a near future where for a small fee (maybe even included in your EverquestII account) you can download X amount of movies to keep, or X amount for "renting" that will selfdestruct after a month.

And not having to wait bloody ages when downloading a movie only to find out it is Tommy Lee and Pamela romping about again. Most of us want to be legal me thinks, just not paying through our noses while being legal.

Of course this will be compatible with the PSP and have the ability to be burned on a DVD.

But only 500 movies? I want the old stuff that you can't find in any shop. Bad horror movies from the 70s and 80s, ability to download all movies and series starring a certain actor or made by a certain director. Not to mention this is the perfect vehicle for all Manga fans out there.

Streaming won't suffice though. Someone calling me on my IP phone would crap the bandwidth right up.
Posted by Daniel Londonsvenskar (7 comments )
Reply Link Flag
We Developed a Great Business Model for Video
We have been working on digital film and video distribution business model since 1998. We have developed a business model that is perfect for digital distribution of compelling entertainment. Technology like bittorrent, big hard drives, and time-shifting vlogging is making everything work perfect for us. If Hollywood keeps going they will probaley also figure out what took us a few years to develop and master. Glad to see they are starting to get it. There clearly are some interesting surprises however, when you start do this. Itunes is great for music but it has a few limitations we found for video global distribution. Decentralization of entertainment production is also going to make a lot of new entertainment available. I hope Hollywood is ready for fragmentation of their industry like the music industry. One example is a show we did which is an "American Chopper" with women who builds motorcycles for women. TV industry turned it down. But it now has its own way to market. You can see a trailer at www.entertaincbsi.com.

Mike Smith
CEO, EntertainCom
Posted by (2 comments )
Reply Link Flag
Iron fist vs Pied Piper
After posting I read your comments. These days if you have an
idea, check around someone is probably already proving it.

As far as distribution of old libraries of digitized films, Sony
should realize that they can not control distribution format to
allow high margins when they face an open source market for
most other creative digital video. This is no longer the age of
dueling giants as we had in the Betamax vs VHS days.
Technology will iteratively drive the medium and force
companies to evolve their business plans rapidly. Rather than
absolute control Sony should be looking towards revenue stream
direction and accept that the iron fist of copyright has been
replaced with the Pied Piper who survives in an equilibrium
between the economic interests of creators and viewers.

Good luck with your venture.
Posted by woofs_a_lot (14 comments )
Link Flag
We Developed a Great Business Model for Video
We have been working on digital film and video distribution business model since 1998. We have developed a business model that is perfect for digital distribution of compelling entertainment. Technology like bittorrent, big hard drives, and time-shifting vlogging is making everything work perfect for us. If Hollywood keeps going they will probaley also figure out what took us a few years to develop and master. Glad to see they are starting to get it. There clearly are some interesting surprises however, when you start do this. Itunes is great for music but it has a few limitations we found for video global distribution. Decentralization of entertainment production is also going to make a lot of new entertainment available. I hope Hollywood is ready for fragmentation of their industry like the music industry. One example is a show we did which is an "American Chopper" with women who builds motorcycles for women. TV industry turned it down. But it now has its own way to market. You can see a trailer at www.entertaincbsi.com.

Mike Smith
CEO, EntertainCom
Posted by (2 comments )
Reply Link Flag
Iron fist vs Pied Piper
After posting I read your comments. These days if you have an
idea, check around someone is probably already proving it.

As far as distribution of old libraries of digitized films, Sony
should realize that they can not control distribution format to
allow high margins when they face an open source market for
most other creative digital video. This is no longer the age of
dueling giants as we had in the Betamax vs VHS days.
Technology will iteratively drive the medium and force
companies to evolve their business plans rapidly. Rather than
absolute control Sony should be looking towards revenue stream
direction and accept that the iron fist of copyright has been
replaced with the Pied Piper who survives in an equilibrium
between the economic interests of creators and viewers.

Good luck with your venture.
Posted by woofs_a_lot (14 comments )
Link Flag
Sony foolish - will be washed away
Sony is foolish if they think that cost of production and
distribution will remain high and allow them to maintain the "big
studio" control of digital video movies. They might better be
spending their time aligning with or building the very proletariat
distribution medium they are railing against. At least that way
they have a chance of keeping in the game. Whether it was luck
or vision, Steve Jobs is the one riding the wave of the future.
Sony's plans here will simply be washed away by that wave.
Posted by woofs_a_lot (14 comments )
Reply Link Flag
Sony foolish - will be washed away
Sony is foolish if they think that cost of production and
distribution will remain high and allow them to maintain the "big
studio" control of digital video movies. They might better be
spending their time aligning with or building the very proletariat
distribution medium they are railing against. At least that way
they have a chance of keeping in the game. Whether it was luck
or vision, Steve Jobs is the one riding the wave of the future.
Sony's plans here will simply be washed away by that wave.
Posted by woofs_a_lot (14 comments )
Reply Link Flag
How can Apple reach the living-room (Revolution).
Most "normal" people want to watch movies at home in the
living-room, not in the computer room.

Will people buy Mac minis or plug PCs to their TVs to watch HD
movies from an Apple movie store? Don't count on it.

In my view, the only way Apple can reach the living-room of the
casual movie renter/buyer is through one of the 3 next
generation consoles. Will it be the X-Box 360? No. Will it be the
PS3? It's now clear that it's no...

What's left? A 200-300$ shiny black box that is no bigger than 3
DVD cases (hint hint) and that can play 20 years of Nintendo
games trough an online video-store interface with built-in DRM.

And that box will run on a PowerPC (code named Broadway) with
an ATI graphic chip (code named Hollywood), with a slot loading
DVD and mini GC disk drive and two USB (2?) ports.

Add Apple's iTunes and its store front-end, the iPod and 20
years of Hollywood movies in HD H.264 format to the mix and
you get:

quite a Revolution indeed.

And it will be televised ;)
Posted by (31 comments )
Reply Link Flag
How can Apple reach the living-room (Revolution).
Most "normal" people want to watch movies at home in the
living-room, not in the computer room.

Will people buy Mac minis or plug PCs to their TVs to watch HD
movies from an Apple movie store? Don't count on it.

In my view, the only way Apple can reach the living-room of the
casual movie renter/buyer is through one of the 3 next
generation consoles. Will it be the X-Box 360? No. Will it be the
PS3? It's now clear that it's no...

What's left? A 200-300$ shiny black box that is no bigger than 3
DVD cases (hint hint) and that can play 20 years of Nintendo
games trough an online video-store interface with built-in DRM.

And that box will run on a PowerPC (code named Broadway) with
an ATI graphic chip (code named Hollywood), with a slot loading
DVD and mini GC disk drive and two USB (2?) ports.

Add Apple's iTunes and its store front-end, the iPod and 20
years of Hollywood movies in HD H.264 format to the mix and
you get:

quite a Revolution indeed.

And it will be televised ;)
Posted by (31 comments )
Reply Link Flag
 

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