Times are tough. With financial resources dwindling by the minute, the movie-viewing public recoils in horror as Hollywood asks them to pay $39.99 for a film on Blu-ray disc. But there are ways to watch those flicks that are more economical. Just in time for cash-strapped film buffs to snap them up, increased bandwidth and processor power are making it practical to stream or download HD movies to living rooms and home theaters.
Sounds good, but there's a catch. Those production studios are holding out on us. Look at the Netflix HD service on the Xbox 360, the super-sharp HDX movies on the Vudu set-top box, HD movies via Apple TV, and you see the same story every time: thousands of movies and nothing on.
The best movies aren't available for download in HD. The studios are protecting their lucrative Blu-ray sales. Doesn't this sound a lot like the record companies when they tried to stop the online digital music juggernaut just so they could keep selling CDs for $16.99?
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Movie studios are throttling the online release of their best and newest titles, just at the same moment that broadband connections and PCs can handle HD streaming and downloads. We took a look at the best-selling Blu-ray discs on Amazon, and noticed that only one of the top 10 sellers is available on any download/streaming service in HD. That one movie is Iron Man, pretty much the studios' poster child for online sales, holding it out and figuratively saying, "See, we're offering good movies online." No, you're not. One new blockbuster overshadowing hundreds of third-tier flops (Get Smart, I'm looking at you) and moldy oldies does not an online library make.
Why Are They Doing This?
Content purveyors would like to protect their old business models. They want to keep that Blu-ray and DVD gravy train rolling. Some consumers are enabling this. For reasons I don't really understand, a sizable portion of movie buffs want to collect discs to watch again and again, or to just see their boxes lined up on a shelf. For that, many are willing to pay upwards of $25.99 (or a crazy $39.99 retail price) for Iron Man or Hancock or Dark Knight or Wall-E on Blu-ray, because they can't get those movies in HD quality any other way.
Or Can They?
A peek at one of the many torrent tracking sites shows that every movie that's released on Blu-ray is available for illegal peer-to-peer (a.k.a. BitTorrent) download in pristine 1080p, sometimes weeks before the physical Blu-ray disc ships. And those copyright-infringing downloaders are not the worst problem for 2009, according to Forrester Research analyst James McQuivey. He says websites such as megavideo.com and watch-movies.net are an even bigger threat to movie studio revenue in the coming year.
Worn-out Business Models
It's not just the movie studios that are trying to protect worn-out business models. TV networks are holding back full episodes of series for online viewing or download, protecting syndication revenues that garner billion-dollar profits. At the same time, heavy downloaders are being throttled by service providers such as Time Warner, struggling to conserve bandwidth while also protecting their own pay-per-view movie and pay-channel revenues.
Past is Prologue
Clinging to tired old business models ... standing in the way of technology: Doesn't this sound a lot like the record companies in the early part of this century? They tried to protect sales of their overpriced CDs while the world discovered the lubricated ease of downloading every song ever recorded. For free. Eight years later, record stores have almost disappeared from the landscape, and Americans download twice as many singles as they buy in CD form. Digital downloads of music just surpassed overall CD sales at Atlantic Records. Apple's iTunes continues to sell music for $0.99 a song, an almost-reasonable price that's helping record companies salvage some profit in this new way of doing things.
Downloads on the Upswing
Likewise, HD movie downloads will eventually surpass sales of Blu-ray discs. In the meantime, movie studios can't foot-drag this technology just so they can continue supporting their traditional business model. They must make HD offerings plentiful and reasonably priced; the current fantasy of retailing movies at $40 will not fly. Downloads will happen either way — with studios receiving a fair profit, or left out in the cold while consumers find a free way to do the same thing.