Everything's on the table

Apart from quality and integrity, it seems.
It is informative to read Disney boss Bob Iger's presentation to the financial wizards of the Deutsche Bank this month. There's a major change of thinking in what he says about the way we consume entertainment media and it's going to have a profound impact on the future of our industry.

"There's confusion out there about what digital technology and high-def is," Iger told his audience, "and Blu-Ray and what Blu-Ray is. And I think that contributes a little bit to the hesitancy that you see in the marketplace to buy the new formats, even though the format is very compelling."

In a nutshell, that is the problem. What is Blu-ray? If you ask around, you'll find many people just don't know. Challenge them and they might tell you it's a 'better DVD' or 'a cool feature in my PS3' but rarely do they appreciate the benefits of lossless audio, high data rates or web connection.

To listen to the HDTV over the web guys, you'd pretty quickly believe that all HD is born equal. You want 720p from YouTube? You got it. 1080i over your ADSL broadband connection? No problem. Seen on your flat screen plasma display and from around 15 feet away it's "awesome" whether it was encoded at four or fourteen megabits. And tell me why I need Blu-ray again, when I can download all this stuff from the web? It's hard to counter these propositions.

A physical disc is easy to play whenever and wherever you want, which is what has sustained this business for the past few years. People like to build libraries; give discs as presents; let the children choose their own entertainment from a pile of DVDs, without having to go online. Blu-ray was supposed to pick up sales as DVD declined, adding quality, usability and interactivity to take us into the second decade of the 21st century. But connectivity could be its Achilles heel.

Bob Iger told his audience "The average home in the United States that owns a DVD player already owns 80 DVDs; there are many with well over 125. So in the last decade we saw a fair amount of growth in library building." What he said next is worrying. "Once you own 80 movies, I believe no matter what the economy is, you're going to be more selective about movies that you buy."

The answer to the decline in packaged media sales is not to be found in new blu shiny discs. As far as the mouse is concerned, the computer is the way of the future, an entertainment platform in its own right. Rather than the purchase of single, high value Blu-ray discs, consumers will be wooed by online entertainment, enticed to regard the web site as a 'destination' and visit often. If you can sell the occasional BD to collectors when they are passing, that's great, but all the extras, all the social networking, all the interactive features will be online, 'free' at the point of access. In exchange for this, advertising, appropriate sponsored links and other revenue-generating activities will be alongside the fun stuff.

It's a compelling vision of the future and it is not one that is restricted to Bob Iger, even though he may be the first to articulate it in such detail. Broadband video has changed the paradigm. It is now economic to do exciting things with Java and Flash on the website that cannot be financially justified on a Blu-ray disc. The result is a raft of plain vanilla BD titles that are audio-visually impressive but interactively lacklustre. In some recent releases, the DVD is far more exciting than the BD as a result of long production lead times and the version confusion in the Blu-ray player market.

Just as this truth becomes apparent, a further digital spanner is thrown into the works. A number of dedicated HD media players have been launched to bridge the gap between TV and PC, such as the Seagate FreeAgent Theater. A 500GB hard drive that docks with the computer and the TV, this unit emulates DVD playback, reading the VIDEO_TS file to display menus perfectly while upscaling SD to 1080i. It's robust enough to be given to the kids and big enough to store fifty or more ripped DVDs on a single drive.

It gives added emphasis to Bob Iger's words: "The computer is a very, very important place to entertain people."