Posts tagged ‘digital entertainment’

UV Doesn’t Smell Right

What a day for UltraViolet articles.  I understand that the group is planning a flurry of press releases based on some announcements that it is ready to launch, and the media is beginning to smell something isn’t quite right.  Being I’m still the skeptical Fool, I wanted to do a brief roundup of recent dubious UltraViolet coverage.

We all know what’s going on in the declining entertainment business, and today’s Financial Times does a nice job in telling it straight.  In no uncertain terms, if Hollywood can’t figure out digital and address the decline in home entertainment, Hollywood will stop making movies.  With big film concepts being shelved because they’re too expensive, we’re beginning to see the slowdown in new releases. It terms of digital dreams like UltraViolet saving the day, the FT had this to say:

Yet for all of the enthusiasm, Ultraviolet increasingly looks like a last throw of the dice for an industry desperate to preserve its retail business model. It is clear why Hollywood wants to keep selling movies: the profit margin on a DVD sale is more than 65 per cent – close to double the margin on a rental. Selling an electronic format is even more profitable because there are no manufacturing costs and minimal distribution costs.

But consumer behaviour has changed radically in the five years since DVD sales reached their peak, making it difficult to predict demand for a cloud-based rights locker. After all, consumers hardly lack choice when it comes to streaming movies or online TV programming.

The FT correctly sniffs out that UltraViolet’s positioning of selling $14 digital movies to consumers isn’t quite right.  With more and more options to rent and acquire content, UltraViolet runs the risk of being vDOA – Very Dull on Arrival.

The Hollywood Reporter talks about how retailers are bracing for a holiday season that doesn’t look so bright.  Retailers may afterall turn to digital to help ease their pain.  Hollywood Reporter, however, points out a glaring pimple on the face of the industry’s transition to digital: like it or not, there may be TWO major digital offerings this Holiday.  Disney’s All-Access with its Keychest digital locker competing with UltraViolet will supposedly be available soon (which is a bold statement to say that either will be ready).  By the way, All-Access content won’t work in the UltraViolet digital locker and vice versa.

Execs deny they want to start a format war, but let’s get serious for a moment.  There are two ecosystems that don’t play the other’s content.  No format war? That doesn’t quite smell right to me.

Keep your eyes, ears and nose peeled for more critical news of UltraViolet.  You’ll catch a whiff of something not right as well.

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Entertainment Retail is Dying

Things seem to just be getting worse for retailers as difficulties mount.  In turn after unfortunate turn, the stories seem to end up with retailers shutting down.  And this is especially true with retailers that sell DVDs, Blu-ray discs or CDs.  Unfortunately, the broader entertainment industry is not doing much to help out.  In fact, the finger of blame for much of the closing of these very important channels for entertainment companies can be pointed directly at…the content owners themselves.

Entertainment Retail is nearly dead and is gasping for air

In today’s news, Nipper, the loyal old dog that used to listen to His Late Master’s Voice, seems to have turned on all of his owners and has lived up to his name by biting one of the last surviving entertainment retailers in the UK.  You see, HMV – the retailer with the logo of the cute little terrier listening to the gramophone, is pretty much a goner.  The share price hit its lowest level ever during trading today and closed at 10.25 penceRecently, in a not-so-amusing gaff, an important Englishman named George Osborne (he’s the Chancellor of the Exchequer) basically stated that HMV is just about dead.

After three profits warnings in the past four months and continually trying to sell different chunks of the business, the future does not look so good.   They continue to fight for their life, but let’s just say that HMV is not a particularly appealing stock.

On our side of the pond, Best Buy in a recent press release talked about some not-so-good Q4 results. No, Best Buy is not going out of business, but their entertainment category might.  In Q4, entertainment declined by low double digits.  And their recent erratic behavior (buying the CinemaNow name to try to win its own Best Buy digital customers while recently doing a deal with Roku that hands customers directly to Roku and its content partners), indicates that they have no idea what to do.

Now try this:  Think back to ten years ago.  What retail stores did you go to in oder to buy your music?  Name three stores.  OK now think of today.  What retail stores do you go to in order to buy music from your heyday?   Not so easy to think of, right?

You get the evidence

So what is going on here?  Sure, there’s the lame excuse about the economy, the proliferation of entertainment options, the shift to other ways of consuming.  But, there is something else going on.  I believe the content owners have been playing games that have led to the destruction of entertainment retail.  As if on cue, Kevin Tsujihara of Warner Brothers Home Entertainment today announced a “Mega-App” that basically cuts retailers right out of the picture so Warner can go direct to customers.

How’s that for kicking a dog while it’s down!

8 tracks beat digital album sales?

In the “isn’t data cool” category, check out this graph which compares 8-track sales to digital album sales.  While the game is far from over, I can’t help but notice that the growth rate for 8-track is better than digital albums.  It’s really no surprise since you can’t beat the convenience of downloading tracks.  But this is more eye-poking evidence to the music business that packaged music is all about singles and that the album is going the way of the Model T.

Here’s the blurb from the article.

The digital album may ultimately win this race, though cumulative 8-track sales are still much larger than digital album sales to-date.  And here’s a scary thought: at current growth rates, the brick-like 8-track could actually be hailed the victor.  Take a look at these shipment totals, based on RIAA figures dating back to 1973 (the format was actually introduced in the mid-60s, though we don’t have reliable figures for that pre-1973 period).

I’ve got no real pearls of wisdom here today, other than the obvious: if you’re in the music business and want to make living, embrace social media to get the word out.  Build an audience organically, and then get on the road to earn some cash.  Live performances are the only way to survive in this new game…

Life imitating art? Or…

I told you I was snarky due to the weather…But I feel much better, and guilty for mentioning anything in the first place.  At least I get to work from home and not deal with snow in my city.

This post is symbolic of life’s inexorable march toward digital, and how the blur between real and digital is becoming more and more difficult to discern.  Check out these posts from Gizmodo and a comment regarding the Snowpocalypse on the East Cost over the last few days.  It got me thinking – does art imitate life, or does life imitate art?  Hmmm.

In the Gizmodo video, this car actually landed in this position!

And then there’s the art piece.  Which came first?  Strange days indeed.

Digital induced madness

I’m feeling a bit snarky after this weekend.  Maybe it’s the weather, or the chaos in Egypt.  Or maybe it’s because I am still so bemused, befuddled, bewildered and be-Fooled  at the whole concept of Digital Copy and why on earth studios are just so stubborn about thinking that customers give a damn about it.

I sat down with the kids to melt my brain to Despicable Me, and was subjected to a 3 minute trailer on how great Digital Copy is and how it’s the future of entertainment on the go.

As I watched the sleek and sexy production, I had to go “pffft” (meaning “as if”) when the trailer walked through a few use cases that no one on earth is going to ever do.  They showed a couple at the top of Mulholland Drive in a convertible, overlooking LA, with their laptop on the dash and watching a movie.  “Take it with you where ever you go” was the voice over.   I had to ask, who the hell is going to bring their laptop so they can watch a movie at the top of Mulholland Drive?

And then, it cut to a scene with a mother shopping in the store while her toddler, safely strapped in the cart, watched a movie on her mommy’s cell phone.  “Now moms can entertain their kids any time on any device.”  What?!  What mom is going to give a toddler a cell phone so that they can watch a movie in the store?  Wait a minute – maybe they are on to something!  With Digital Copy, you never even have to make eye contact with your kid since they will be glued to all your devices to watch movies!

OK, I get the point – watch movies wherever you are.  I’m all for it.  But really, what customers really care about watching movies where ever they are?  Aren’t movies best enjoyed at home, with your family or friends, on a screen that doesn’t cause your eyes to hurt, or your neck to ache, or your wrists to cramp?

This is the crux of the issue for all digital entertainment, Digital Copy prominently included, and for the dozens of companies/consortia out there trying to do something about it.  We’ve got to ask ourselves, who really cares?

By the way, Despicable Me was great.  And the best part was watching it with my kids on a lazy Sunday afternoon.

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