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Headline, Technology News
Online distribution pulls ahead of film
Monday February 09th 2009The entertainment biz will remember 2008 as the year when global revenues from digital media exceeded revenue generated by movie theaters and homevideo combined. In its “Global Media & Entertainment Market Forecast, 2004 – 2012,” London research firm Strategy Analytics reported that online and mobile channels accounted for $90 billion in worldwide revenues; the global filmed entertainment market generated $83.1 billion.
“We’re starting to see now that digital media is becoming a significant part of revenue for a lot of companies,” says Strategy Analytics director of digital media research Martin Olausson. “A few years back, everyone was still discussing whether movies would be distributed online. That’s not a discussion anymore.”
For the global film industry, this is a double-edged sword.
Broadband downloading and streaming, terrestrial and cable video-on-demand (VOD), and mobile platforms are now all ways to watch entertainment content, from feature films and TV shows to made-for-Internet/mobile programming.
For the last few years, the questions have been: Are these viable alternatives to theatrical distribution? How much more content will auds consume on digital platforms? And will such platforms offer new production opportunities and generate fresh revenue streams?
Strategy Analytics’ astonishing numbers imply that digital distribution may have already won the day.
Of course, it’s not that simple. First, the technology isn’t where it needs to be for global domination. “There are still technical limitations, especially in the networks that go to the home,” Olausson says. “When you’re talking about HD content, you need a serious, 10-megabit connection to the home to have just one stream of HD, and since you have multiple uses in the home, you start talking about 30 to 50 megabits. We’re not there in most markets, with the exception of Korea.”
A quick look at broadband penetration shows the U.S., at 63.1%, and many European countries still lag behind South Korea’s 94% (see chart).
Then there are the business models. Hollywood studios, the proverbial ocean liners, are still in the midst of a lumbering turn. “The rules of TV and film said that producers and distributors told consumers what, when and how,” says the Carmel Group senior analyst Jimmy Schaeffler. “Now the power is slowly shifting to the consumer. These new digital technologies stretching from DVRs to the Web are turning the business upside-down.”
One major example is a case that may be decided in the U.S. Supreme Court. Cable TV provider Cablevision has long sought to move DVR functions away from the set-top box in the home over to servers at the cable company office. Studios and TV networks oppose such a service on the grounds that it violates their copyright protection.
“That raised a plethora of complicated and provocative questions related to who owns the content and whether the operator makes any more money,” Schaeffler says. Time Warner, Turner, CBS, NBC, Fox, ABC and Paramount balked at Cablevision’s plan, saying the remote server is a different model and requires an additional license.
Final word on whether this is indeed a new form of distribution has not yet been handed down. “They’ve already let the genie out of the bottle with TiVo,” Schaeffler says. “Content providers and distributors need to look short term, medium term and long term and make consistent decisions.”
This isn’t the only example of the evolving realities of digital distribution. In 2008, for example, Apple switched its downloadable model to rental. “To a large degree, that was because they saw the success of Microsoft Xbox Live, which only offered a rental solution, and that of Netflix, which added its Watch Now broadband option,” Olausson notes.
New forms of digital distribution vary wildly by country, says iSuppli analyst Steve Rago: “France is the mecca today for broadband TV. VOD is a very popular service, and revenues are going up. The same with Hong Kong and Korea VOD broadband, and now the government has given them permission for broadcast VOD as well.”
In the U.K., the National Endowment for Science, Technology & Arts chose 12 film companies to test digital distribution and production. Cross-media production company OneDotZero was one of the recipients of those grants.
“What we’re interested in is developing a sustainable model for production and distribution of content,” director Shane Walter says. “It’s a new way of developing content and ideas. The way audiences now consume media, maybe they go see a feature film, but they’re also interested in seeing a spinoff of that online or on the mobile phone.”
Although kinks in the model have yet to be resolved, the momentum is undeniably — indeed, relentlessly — forward. “It’s very much a youth-driven revolution,” Schaeffler says. “Technology makes digital distribution very desirable, and the forthcoming generations will demand it.”
WIRED WORLD
Percentage of households with broadband in 2008, listed by country’s rank:
94.0% South Korea
85.4% Denmark
82.9% Netherlands
81.7% Hong Kong
76.3% Australia
75.2% Norway
74.7% Canada
71.7% Japan
71.5% Spain
71.2% Switzerland
70.9% Finland
68.1% Taiwan
66.3% United Kingdom
63.1% USA
63.0% France
62.5% Sweden
58.7% Belgium
56.4% Ireland
56.2% Germany
52.3% Austria
Source: Variety
Headline, Technology News
Online distribution pulls ahead of film
Monday February 09th 2009The entertainment biz will remember 2008 as the year when global revenues from digital media exceeded revenue generated by movie theaters and homevideo combined. In its “Global Media & Entertainment Market Forecast, 2004 – 2012,” London research firm Strategy Analytics reported that online and mobile channels accounted for $90 billion in worldwide revenues; the global filmed entertainment market generated $83.1 billion.
“We’re starting to see now that digital media is becoming a significant part of revenue for a lot of companies,” says Strategy Analytics director of digital media research Martin Olausson. “A few years back, everyone was still discussing whether movies would be distributed online. That’s not a discussion anymore.”
For the global film industry, this is a double-edged sword.
Broadband downloading and streaming, terrestrial and cable video-on-demand (VOD), and mobile platforms are now all ways to watch entertainment content, from feature films and TV shows to made-for-Internet/mobile programming.
For the last few years, the questions have been: Are these viable alternatives to theatrical distribution? How much more content will auds consume on digital platforms? And will such platforms offer new production opportunities and generate fresh revenue streams?
Strategy Analytics’ astonishing numbers imply that digital distribution may have already won the day.
Of course, it’s not that simple. First, the technology isn’t where it needs to be for global domination. “There are still technical limitations, especially in the networks that go to the home,” Olausson says. “When you’re talking about HD content, you need a serious, 10-megabit connection to the home to have just one stream of HD, and since you have multiple uses in the home, you start talking about 30 to 50 megabits. We’re not there in most markets, with the exception of Korea.”
A quick look at broadband penetration shows the U.S., at 63.1%, and many European countries still lag behind South Korea’s 94% (see chart).
Then there are the business models. Hollywood studios, the proverbial ocean liners, are still in the midst of a lumbering turn. “The rules of TV and film said that producers and distributors told consumers what, when and how,” says the Carmel Group senior analyst Jimmy Schaeffler. “Now the power is slowly shifting to the consumer. These new digital technologies stretching from DVRs to the Web are turning the business upside-down.”
One major example is a case that may be decided in the U.S. Supreme Court. Cable TV provider Cablevision has long sought to move DVR functions away from the set-top box in the home over to servers at the cable company office. Studios and TV networks oppose such a service on the grounds that it violates their copyright protection.
“That raised a plethora of complicated and provocative questions related to who owns the content and whether the operator makes any more money,” Schaeffler says. Time Warner, Turner, CBS, NBC, Fox, ABC and Paramount balked at Cablevision’s plan, saying the remote server is a different model and requires an additional license.
Final word on whether this is indeed a new form of distribution has not yet been handed down. “They’ve already let the genie out of the bottle with TiVo,” Schaeffler says. “Content providers and distributors need to look short term, medium term and long term and make consistent decisions.”
This isn’t the only example of the evolving realities of digital distribution. In 2008, for example, Apple switched its downloadable model to rental. “To a large degree, that was because they saw the success of Microsoft Xbox Live, which only offered a rental solution, and that of Netflix, which added its Watch Now broadband option,” Olausson notes.
New forms of digital distribution vary wildly by country, says iSuppli analyst Steve Rago: “France is the mecca today for broadband TV. VOD is a very popular service, and revenues are going up. The same with Hong Kong and Korea VOD broadband, and now the government has given them permission for broadcast VOD as well.”
In the U.K., the National Endowment for Science, Technology & Arts chose 12 film companies to test digital distribution and production. Cross-media production company OneDotZero was one of the recipients of those grants.
“What we’re interested in is developing a sustainable model for production and distribution of content,” director Shane Walter says. “It’s a new way of developing content and ideas. The way audiences now consume media, maybe they go see a feature film, but they’re also interested in seeing a spinoff of that online or on the mobile phone.”
Although kinks in the model have yet to be resolved, the momentum is undeniably — indeed, relentlessly — forward. “It’s very much a youth-driven revolution,” Schaeffler says. “Technology makes digital distribution very desirable, and the forthcoming generations will demand it.”
WIRED WORLD
Percentage of households with broadband in 2008, listed by country’s rank:
94.0% South Korea
85.4% Denmark
82.9% Netherlands
81.7% Hong Kong
76.3% Australia
75.2% Norway
74.7% Canada
71.7% Japan
71.5% Spain
71.2% Switzerland
70.9% Finland
68.1% Taiwan
66.3% United Kingdom
63.1% USA
63.0% France
62.5% Sweden
58.7% Belgium
56.4% Ireland
56.2% Germany
52.3% Austria
Source: Variety
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Headline, Technology News
Online distribution pulls ahead of film
Monday February 09th 2009The entertainment biz will remember 2008 as the year when global revenues from digital media exceeded revenue generated by movie theaters and homevideo combined. In its “Global Media & Entertainment Market Forecast, 2004 – 2012,” London research firm Strategy Analytics reported that online and mobile channels accounted for $90 billion in worldwide revenues; the global filmed entertainment market generated $83.1 billion.
“We’re starting to see now that digital media is becoming a significant part of revenue for a lot of companies,” says Strategy Analytics director of digital media research Martin Olausson. “A few years back, everyone was still discussing whether movies would be distributed online. That’s not a discussion anymore.”
For the global film industry, this is a double-edged sword.
Broadband downloading and streaming, terrestrial and cable video-on-demand (VOD), and mobile platforms are now all ways to watch entertainment content, from feature films and TV shows to made-for-Internet/mobile programming.
For the last few years, the questions have been: Are these viable alternatives to theatrical distribution? How much more content will auds consume on digital platforms? And will such platforms offer new production opportunities and generate fresh revenue streams?
Strategy Analytics’ astonishing numbers imply that digital distribution may have already won the day.
Of course, it’s not that simple. First, the technology isn’t where it needs to be for global domination. “There are still technical limitations, especially in the networks that go to the home,” Olausson says. “When you’re talking about HD content, you need a serious, 10-megabit connection to the home to have just one stream of HD, and since you have multiple uses in the home, you start talking about 30 to 50 megabits. We’re not there in most markets, with the exception of Korea.”
A quick look at broadband penetration shows the U.S., at 63.1%, and many European countries still lag behind South Korea’s 94% (see chart).
Then there are the business models. Hollywood studios, the proverbial ocean liners, are still in the midst of a lumbering turn. “The rules of TV and film said that producers and distributors told consumers what, when and how,” says the Carmel Group senior analyst Jimmy Schaeffler. “Now the power is slowly shifting to the consumer. These new digital technologies stretching from DVRs to the Web are turning the business upside-down.”
One major example is a case that may be decided in the U.S. Supreme Court. Cable TV provider Cablevision has long sought to move DVR functions away from the set-top box in the home over to servers at the cable company office. Studios and TV networks oppose such a service on the grounds that it violates their copyright protection.
“That raised a plethora of complicated and provocative questions related to who owns the content and whether the operator makes any more money,” Schaeffler says. Time Warner, Turner, CBS, NBC, Fox, ABC and Paramount balked at Cablevision’s plan, saying the remote server is a different model and requires an additional license.
Final word on whether this is indeed a new form of distribution has not yet been handed down. “They’ve already let the genie out of the bottle with TiVo,” Schaeffler says. “Content providers and distributors need to look short term, medium term and long term and make consistent decisions.”
This isn’t the only example of the evolving realities of digital distribution. In 2008, for example, Apple switched its downloadable model to rental. “To a large degree, that was because they saw the success of Microsoft Xbox Live, which only offered a rental solution, and that of Netflix, which added its Watch Now broadband option,” Olausson notes.
New forms of digital distribution vary wildly by country, says iSuppli analyst Steve Rago: “France is the mecca today for broadband TV. VOD is a very popular service, and revenues are going up. The same with Hong Kong and Korea VOD broadband, and now the government has given them permission for broadcast VOD as well.”
In the U.K., the National Endowment for Science, Technology & Arts chose 12 film companies to test digital distribution and production. Cross-media production company OneDotZero was one of the recipients of those grants.
“What we’re interested in is developing a sustainable model for production and distribution of content,” director Shane Walter says. “It’s a new way of developing content and ideas. The way audiences now consume media, maybe they go see a feature film, but they’re also interested in seeing a spinoff of that online or on the mobile phone.”
Although kinks in the model have yet to be resolved, the momentum is undeniably — indeed, relentlessly — forward. “It’s very much a youth-driven revolution,” Schaeffler says. “Technology makes digital distribution very desirable, and the forthcoming generations will demand it.”
WIRED WORLD
Percentage of households with broadband in 2008, listed by country’s rank:
94.0% South Korea
85.4% Denmark
82.9% Netherlands
81.7% Hong Kong
76.3% Australia
75.2% Norway
74.7% Canada
71.7% Japan
71.5% Spain
71.2% Switzerland
70.9% Finland
68.1% Taiwan
66.3% United Kingdom
63.1% USA
63.0% France
62.5% Sweden
58.7% Belgium
56.4% Ireland
56.2% Germany
52.3% Austria
Source: Variety
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