UltraViolet Project a ‘Do-Over’ for Consumer Access to Content, Singer Says
Studios’ nascent UltraViolet initiative amounts to a “do-over” for the industry to give consumers access to legally purchased content on a wide array of devices, the chief technology officer of a major movie company said. Sony Pictures’ Mitch Singer, president of the multi-industry group backing the project, told communications lawyers and executives that the initiative comes after studios tried a strategy of filing lawsuits to “stop the innovation from happening."
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Now studios are dealing with “disruption” of distribution models head-on, Singer told an FCBA educational seminar in Washington Tuesday night. A Dish Network executive said it keeps simplicity of devices in mind, given many consumers aren’t cutting the cord because of concerns over complexity in getting high-quality video online. A plethora of ways to get content means network bandwidth capacity will be an issue “at all points” including Internet backbones, said Adam Goldberg, a consultant to technology companies. “And net neutrality I think is going to be an issue for some time."
A few years ago some thought digital content licensing was “a failed business model” for collecting media, with consumers unsure if content they bought would be accessible on new devices, Singer said. “Consumers want to aggregate content and want to play it on any device,” which undergirds the potential for UltraViolet, he added. “Simply putting it on the cloud is only a beginning” of the project. It will start commercially this year, Singer said. He said all major studios except for Disney are members, as are major consumer electronics manufacturers and retailers including Dell and Best Buy as well as Motorola, Comcast and its NBCUniversal business and Cox Communications.
The basis behind developing UltraViolet was meeting the demands of millennials, which Singer called the “largest generation.” To laughter, he said “all you baby boomers there, you're out. Nobody cares about you.” The thought behind the initiative is “we better do something quickly to meet their needs,” he said of millennials. It’s “better we disrupt ourselves than a new third-party service disrupting it for their gain,” Singer said. “We're building standards around this new format” and “it’s actually in a way the new standard for digital distribution,” he said: UltraViolet is about “an infinite number of devices that can access your content” by using a “digital proof of purchase” to authenticate ownership of media across devices. “What are we going to do to address the disruption in the industry,” Singer asked. “I think this is just the first step."
Singer hopes “regulation, litigation” won’t happen in the sector, and instead there will be “a series of agreements” between companies, he said: That’s “now happening in numbers that we did not see even a few years ago.” He doesn’t foresee release windows “collapsing” in which movies can be viewed on pay TV soon after they hit theaters, but it would be good if cinema-goers could use their ticket to watch related content at home. “I think congestion over the network should be a concern for everybody,” Singer said of his personal views on bandwidth. “We do see LTE and other 4G networks starting to roll out at very high bandwidth rates” and “some really interesting solutions to those problems” of not enough capacity, though he’s unsure if that will “outpace” use of Internet networks, Singer said.
That “customers want simplicity” is demonstrated because cutting the cord by canceling TV service, while getting similar content with ease elsewhere, is hard, Dish Senior Vice President Jeff Blum said. He keeps the proverbial “grandma in Iowa” in mind, who will want a simple set-top box for TV viewing. “There are millions of those people throughout the country who don’t live in D.C. or New York and don’t have all the new technologies,” and “we can’t forget about them,” Blum said. Dish thinks most people fall into the “middle bucket” segment of the population that wants a cable or satellite subscription for the “ease” of use, he said. Blum predicted “that communal experience where not everything is on the iPad or ‘I want to watch this movie'” individually on a small device “will last."
"The big copyright issue that maybe the Supreme Court will have to decide” in the coming years is the rights of a subscriber who legitimately buys content to “time shift” it to devices like iPads, Blum said. On “that copyright battle, I think we're going to get guidance from the courts,” he said, pointing to Time Warner Cable’s copyright dispute with some cable channel owners. “I think the next copyright battle will be do we have the right to place shift that content,” and hopefully there won’t be too much litigation, Blum said. He sought a “free market” for new movies to be released multiple ways, including in theaters, where hits will continue to draw crowds. “You never know when you produce a movie what the value is,” and therefore how much it will get in ticket sales, Singer responded. “In a theoretical world, it sounds great,” he continued: “But in the real world, I just don’t see a lot of movies going direct” to homes.