Video Industry Sees Similar Shift in Digital Content Distribution as in Music
Digital technologies have made music and movie content easier to distribute and produce, said executives in the movie and music industries. There are lessons to be learned from music’s digital transition that can help the video industry understand its shifting distribution channels, they said Tuesday evening during a Silicon Flatirons panel discussion webcast from the University of Colorado at Boulder.
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The music industry had to transition to new digital distribution models very quickly, said Cary Sherman, CEO of RIAA. “It had to be done at the same time as a rampant piracy was dropping the bottom out of the music industry.” Since then, piracy has declined, he said. “It’s still a problem, but not as bad a problem as it was,” he said. “More than 60 percent of our revenues come from digital, [and] we've licensed every kind of service,” he said. “Revenues have leveled off and we're getting to the point where we're going to see growth again.” It’s very easy to digitize music, said Mark Cooper, research director at the Consumer Federation of America. “We shall see about where video goes.”
Digital technology has given independent artists a lot of opportunity, said Justin Konrad, an entertainment attorney at Hutchinson Black. It’s a time of great optimism for independent publishers and artists, he said. There also are new technologies for distribution, like Spotify and Pandora, he said. “The trouble is that they're difficult to monetize.”
New technology has made it cheaper and easier to make a studio-quality album in a basement, said Konrad. “The technology has made it such that you can bootstrap a record. … It doesn’t have to be a financed record.” There’s always been a lot of independent content and it fed the system very well, said Sherman. “A lot of self-produced stuff is put out there but it doesn’t necessarily sell. … It’s part of what you do to get exposure."
The innovation in technology works well with the movie industry, said Linda Kinney, MPAA senior vice president. There’s a lot of innovation in the movie and video industry, she said. “They're technology companies at heart.” The new digital environment “is creating new revenue streams that didn’t exist in the analog world,” she said. “DVD sales have gone down, but there are revenue streams that made up for that,” like VOD, Internet advertisers and TV Everywhere, she said.