The Future of Packaged Media 09 conference (Feb. 3-4, Los Angeles), a joint venture of the Frankfurt, Germany-based Media-Tech association, the Content Delivery & Storage Association (CDSA, the former International Recording Media Assoc.), and the Entertainment Merchants Association (EMA), marked an interesting point in the progression of packaged entertainment media. Where previous Media-Tech conferences have had a heavy technology focus, the estimated 300 attendees and exhibitor personnel that converged here found that this year’s iteration ranged substantially further afield.

"There was a need for this conference to bring in some fresh perspectives from people in the entertainment industry but not necessarily in the media manufacturing," which has been the historical focus of the program, said conference director Larry Jaffee. He cited "It’s Out There, Now What?", a presentation by buzzmaker Maurice Bernstein, CEO of Giant Step, relating how he helped turn Katy Perry and Amy Winehouse into brands. "The ‘Future of Packaged Media’ is a pretty broad topic and we wanted to hit on more topics along the food chain than just manufacturing."

Charles Van Horn, president of the CDSA, stated that 75 percent of the speakers had never been on one of the organization’s programs before, and that the emphasis on packaged media was to counter what he said has been an attitude in the general press that "packaged media is dead and digital [distribution] rules."

Show Them The Money
Business and financial issues were hot topics, reflecting the economic concerns that optical disc replicators have been facing as CD and DVD sales continue to trend downward, combined with a still-spreading global recession that is testing the nostrum that entertainment products are recession-proof. (In fact, Edward Williams, senior analyst at market researcher BMO Capital who specializes in the game industry, said that despite a doubling of the installed base of game consoles in the U.S. since 2007, "Games are at best recession-resistant.")

It also marked the first time that manufacturing and operations efficiency consultants presented at the conference. Productiv’s president Rich Boehling suggested that replicators place less emphasis on conventional operational protocols such as Six Sigma and instead implement "Earned Value Contracts," essentially abandoning the hourly wage model and instead reward productivity, as measured by pieces completed per hour. "Employees tend to give maximum effort when [payments are] tied to output," he explains.

A second consultant, Asheesh Barman, executive v.p. at Acutrack, emphasized green best practices. These include encouraging replication clients to move more of their paper products to disc or file formats such as PDF, implementing more manufacturing on demand for short-run work, taking advantage of state and local incentivized programs that reward use of energy-efficient products such as CFL bulbs for plant lighting, and using the same bulk packaging used to deliver blank disc media to ship the finished products back to the customer.

Disc makers got some mixed messages. John Marmaduke, president and CEO of media retailer Hastings Entertainment, believes its 153 stores in mid-sized U.S. markets that sell both new and used CDs and DVDs validate the big-box retail concept despite the fall of Tower, HMV, Wherehouse and other large media sellers. "A third of customers surveyed say that they’re OK with used media," told attendees, some of whom were replicators. He said that the buy-sell-trade-rent initiative underscores the notion that media is moving towards a "temporary ownership" model, in which DVDs and other media products move in a continuous cycle that Hasting is positioned as hub for.

On the other hand, BMO Capital analyst Edward Williams believes that game software is moving inexorably towards download distribution, propelled by low-cost apps for the Apple iPhone and iTouch devices, which he added pose a "significant" challenge to handheld game players, particularly Sony’s PSP. "The PSP needs to evolve to meet what is a very credible threat to it from Apple," he stated.

Many familiar disc-manufacturing brands were represented in a small product exhibit area, including mold maker Axxicon, manufacturing line maker Singulus and disc-inspection systems developer Datarius, which introduced a desktop laser-based inspection system that replaces its camera-based scanner for Blu-ray QC.

But there were some new faces that also reflect new directions for replicators. Thomas Fryer, CEO of 2GeeksInALab, asserted the company’s Global Garde content protection software, which uses less then 300KB of file space, enables replicators to offer piracy protection as a service for all types of files, including HTML and PDF formats, as well as on disc. "We believe that more accessible, easier-to-use copy protection will encourage more content owners to use optical discs to distribute content," he said.

Blu-ray Disc
Blu-ray authoring was a strong focus of the conclave, specifically regarding how it has made the authoring workflow more complex than DVD. A panel made up of several leading independent Blu-ray authoring facilities—1K Studios, B1 Media, Giant Interactive, Deluxe Digital Studios, and RCDb—concluded that while progress is being made to establish templates that will streamline the authoring process, issues real and perceptual remain.

"While some [authoring] procedures have ‘settled in’ because there has now been time enough certain templatized processes to have evolved, there is still enough uniqueness in every BD project that makes it difficult to completely streamline the BD workflow in general," commented Bruce Nazarian, president of the International Digital Media Alliance (IDMA) and CEO of Digital Media Consulting Group, Inc., who moderated the panel. But, he added, workflow is challenged by the fact that "clients are asking for far more complex BD projects to be completed on DVD timelines—and sometimes even DVD budgets!"

And that’s before BD-Live enters the picture. Panelists agreed that while the Java-enabled interactive iteration of Blu-ray remains complicated, programming-intensive and vastly more expensive than even standard BD authoring, it’s definitely on Hollywood's agenda.

Brian Johnson, president/CEO of B1 Media, stated, "BD-Live is still very new but the studios are putting a lot behind it."

Despite the format’s slow progress toward gaining consumer traction and mindshare, Johnson says it’s a necessary step for the progression of games on disc. "We carved out a niche for creating games for DVD releases over the last ten years, but the technology was very limiting because standard DVD players had no persistent storage, so all gameplay had to be pre-rendered," he said. "Also, SD players do not randomize well, so we could not create complex games. BD-J has opened that up and allows us to create games that not only look great at 1920x1080 resolution, but that also play like true video games. Now the games we are creating in BD-J are visually impressive and also fun to play because they are a different experience every time. And it’s a great way for the studios to communicate with their audience directly. With a big installed base of connected players, the studios will have direct access to provide their customers with not only Blu-ray Discs, but also downloadable content, and possibly digital versions of their films."

Sidebar: Politics Aside
One of the other notable aspects of the "Future of Packaged Media 09" conference was neither technical, nor specifically economic—it was political. The confab was a joint venture mainly between two trade organizations perceived to some extent as competitive with one another. CDSA and Media-Tech share constituencies among disc replicators, DVD mastering and authoring facilities, and supply chain entities, and both vie for the attention of content providers. Both Bryan Ekus, managing director of the Media-Tech Association, and Charles Van Horn, president of CDSA, acknowledged the perception of competitiveness in past years, though Ekus said it was never intentionally so. "There were anomalies that caused tension on certain sides at times, but our common goal is to bring the community together," he said. "We have to work together in synergistic manner of there won’t be any future."

Van Horn added that the economy also drove the organizations’ convergence on the conference. As for future collaboration, he said, "We will continue to explore other alternatives to move away from a proliferation of events with a lot of overlap to bring people together at a more wide-ranging common event."

Dan Daley (danwriter at aol.com) is an experienced journalist and author, covering the business and technology of the entertainment industry for over 20 years. His work has appeared in numerous publications, both trade and general interest, including Billboard, The New York Daily News, Mix Magazine, GRAMMY Magazine, American Way, Spin, History Channel, TravelHost, International Business, USA Today, ArchiTech, and many others.

The Authoritative Blu-ray Disc (BD) FAQ Has Moved!

Hugh Bennett’s The Authoritative Blu-ray Disc (BD) FAQ has moved to its new home at Hugh’s News (www.hughsnews.ca).

It can now be found at: www.hughsnews.ca/faqs/authoritative-blu-ray-disc-bd-faq

A study into the state of Video-on-Demand (VOD) in the UK, from the perspective of the viewer, has revealed that fragmented delivery technologies, confusing rights restrictions and expensive download charges risk driving viewers away from legitimate VOD services. Many viewers are keeping their use of VOD to a minimum, while others are turning to illegal download sites. But the study: VOD State of Play, developed by Essential Research, found that there is strong consumer demand for a TV-based VOD service and that viewers are willing to accept advertising to help make this a reality.

The report, which combines qual. and quant. research from hundreds of VOD users, predicts that once barriers to VOD are resolved, a seismic shift in the way that TV is consumed will take place: Currently 8/10 PC VOD users only use the services occasionally, however 24% of VOD users claim that they now watch more TV then they did before.

26% of PC VOD users admit to using peer-to-peer or torrents to download video content, with 42% of illegal VOD users saying that "watching programmes that are not scheduled in the UK" is a key driver. Price is also a factor with 75% of VOD users saying that on-demand services should cost less than the equivalent DVD.

Stuart Knapman, Partner at Essential Research and Director of the Study comments: "There is a growing realisation among audiences that they can control what they watch and when they watch it and this has huge appeal. But most are not doing it regularly as they feel that the industry is not keeping up with their expectations. Viewers want a hassle-free, cinematic TV experience with the right content and the right commercial model. When this happens, TV is going to change forever. But for most people the current reality is a computer screen with confusing rights restrictions and lots of proprietary software."

The report also includes classifications to define the attitudes of different VOD users:

1. Broadcast Assassins (18%)
• A tech savvy viewer who no longer relies on the TV schedule
• Has a busy social life, but will find time for must-watch television, such as US series and cult classics
• Uses various VOD services, including illegal file sharing sites to search for specific titles
• Feels forced into use of illegal providers by the deficiencies of legitimate services.
Tend to be male, with a quarter under the age of twenty-five.

2. Schedule slaves (20%)
• Have occasionally experimented with VOD services, but are none too fussed about them. Like television and trust the schedule to help them find something to watch
• Are broadly content with the way they are currently watching
In general this group is ambivalent towards VOD services. It is a diverse group in terms of demographics, understanding and ownership of technology

3. Willing confused (17%)
• Plan television viewing to ensure they never miss their favourite programmes
• Have experimented with VOD and have been impressed with services such as the BBC iPlayer. Complicated interfaces, technical jargon and pricing in many VOD services have left them confused and frustrated

This group tends to be slightly older (average age is 48) and whilst VOD is unlikely to replace scheduled television, there is an opportunity for incremental viewing

4. Unengaged (24%)
Television is not important to this diverse group. Since they see TV as a largely disposable product, they are unlikely to feel compelled to use VOD any time soon

5. Sky Plussers (21%)
• Regular users of Sky+ (and increasingly VOD services) to schedule television around their busy lives. This also allows them to watch more of the television they like, instead of whatever happens to be on
• They are often parents and their children regularly watch clips, programmes and films on computers & laptops. Some are experimenting with file sharing sites

They are generally happy to pay extra for VOD services. 4 in 10 claimed to have bought video from the iTunes store.

The report, which is available from Essential Research on request, was developed in consultation with the BBC, BT Vision, Channel 4, Five, ITV, Microsoft UK, MTV, O2, Ofcom, Three, UKTV, Virgin Media and Warner.

About Essential Research
Essential is a research consultancy specialising in Media, Communications, Technology and Entertainment. Our clients include Microsoft, MTV, the BBC, Channel 4, ITV, O2 and Freeview and we’ve worked on everything from the launch of new TV channels to consumer expectations of mobile video. Essential was established in 2005 by three former BBC executives; Luca Antilli, Stuart Knapman and Alex Charlton and in December 2007 was voted "Best New Agency" by the Market Research Society.

Visit www.essentialresearch.co.uk for further information.

As a globally renowned manufacturer of computer peripherals and optical drives, ASUS is constantly at the forefront of cutting edge technologies, providing users with innovative solutions for everyday computing. In pursuing this philosophy, the new ASUS External Slim SDRW-08D1S-U utilizes user-centric design in the Scenario-Based Design model to better address the needs of the user. By integrating these needs into its development and creation, the ASUS External Slim SDRW-08D1S-U combines both aesthetics and practicality.

Stylishly Simple to Use with Low Power Consumption
Sporting an elegant stand design and high glossy appearance showcasing excellent craftsmanship and quality, the ASUS SDRW-08D1S-U brings together high-speed data access technology and style with its attractive, vertical external DVD burner. A user-friendly software interface allows users to easily burn discs; allowing users to simply drag and drop data into the thumbnail layout when they are burning documents and media into a new disc. Drawing power from the computer and harnessing the transmission speeds of a USB 2.0 port, users can experience high-speed data transfer speeds while utilizing little power, perfect for the modern computing era.

Mobility and Disc Encryption for Trouble Free Mobility On-the-go
The ASUS SDRW-08D1S-U acquires power from the USB port of the users’ notebook or desktop, hence there is no need for an additional power adapter—further reinforcing its portability. Users seeking to protect their data will appreciate the Disc Encryption technology, which allows users to password-protect an entire disc or its partial contents with 128-bit encryption.

Turbo Engine
Turbo Engine increases the connection performance between the USB cable and the optical drive. Traditionally, the computer’s bandwidth slows down conventional optical disc drives while reading or writing data. With Turbo Engine, the ASUS SDRW-08D1S-U is able to read and write data at the highest speed.

www.asus.com

A new SNL Kagan study, "The State of Home Video," forecasts a new wave of revenue growth in the retail home video business over the next decade, generated by the emergence of Blu-ray Disc as the next-generation DVD format.

While the current impact of Blu-ray has been relatively minor (standard DVD still comprises 97.1% of the market), SNL Kagan projects that high-definition DVD will attain 59.7% market share in 2014, with $13.1 billion in revenue. By 2017, this figure is expected to soar to 73.8%, or $15.6 billion.

The SNL Kagan study points to 2010 as the start of the resurgence in retail revenue. Sales of Blu-ray players are expected to grow from $255.4 million in 2008 to $1.3 billion in 2010, reaching mass-market penetration and spiking to nearly $6.9 billion in 2013.

However, Blu-ray’s unrivaled dominance may be short-lived, with video-on-demand (VOD) poised to become a major force in home entertainment after 2017. SNL Kagan estimates that there will be 98.8 million high-speed Internet homes capable of delivering VOD in 2017 compared to 115.2 million high-definition DVD homes.

"Blu-ray will be the driving force behind the video retail market throughout the next decade," said Wade Holden, analyst at SNL Kagan. "The current economic climate, however, will slow the growth of this new format and likely keep it from reaching the heights that it may have in better times. VOD services will continue to improve in both technology and content over the next decade and begin to draw consumers away from Blu-ray and DVD by 2017."

"The State of Home Video" is an in-depth analysis of various segments of the video industry including: DVD and VHS Hardware, Performance Benchmarks, Retail Rental and Sell-Through, Sell-Through Titles, High-Definition DVD, Suppliers and Video-On-Demand.

Reports such as "The State of Home Video" are available exclusively as part of the SNL Kagan Unlimited Information Service. For more information on this report and other media and communications data within the SNL Kagan Unlimited, call 866.296.3743 or email SNLKaganSales@snl.com.

About SNL Kagan
SNL Kagan, a division of SNL Financial LC, is a comprehensive resource for financial intelligence in the media and communications sector, including the broadcasting, cable, entertainment, motion picture, telecom, wireless, satellite, publishing and new media industries. The SNL Kagan suite of products integrates breaking news, comprehensive data and expert analysis into an electronic database available online and updated around the clock. For more information, visit www.snlkagan.com.

In these tough economic times, Americans are likely spending more time at home and in front of the TV. Despite the ever-increasing number of channels offered by cable, satellite, and phone company TV providers, video rental services continue to be a popular source of entertainment for many people. Consumer Reports' latest survey of its online subscribers found that Netflix subscription service had the highest overall satisfaction. The service received high marks for price, selection and service. Most Consumer Reports' online subscribers were highly satisfied with the experience of renting videos from all of the rated providers, which included subscription services, in-store kiosks, and walk-in-stores and chains. Price was the biggest driver of overall satisfaction, although convenience, variety, and flexibility are all factors in what makes a video rental subscription service appealing.

Subscription Services
Consumer Reports' survey respondents found Netflix to be the top choice, rating it higher than Blockbuster's competing Total Access service. With monthly payment plans starting at $5, Netflix was among the standouts for price; it was top-rated for selection and service. Readers reported that orders were filled promptly and with very few errors. The company offers more than 100,000 titles, including 1,000 Blu-ray titles. Mail delivery is supplemented by a streaming service that can deliver videos to a computer or Netflix-enabled TV or Blu-ray player with an Ethernet port.

Although Blockbuster Total Access has the only $4-a-month plan, it was generally more costly than comparable Netflix plans, and survey respondents were less satisfied with the price. But Blockbuster's advantage is that Total Access subscribers can supplement mail delivery and returns by picking up or returning videos at one of the chain's 4,600 stores nationwide. While the company's DVD collection has more than 85,000 titles - about 15,000 fewer than Netflix - its Blu-ray selection is comparable. And unlike Netflix, which charges an extra $1 for Blu-ray titles, Blockbuster doesn't charge a premium for high-def rentals.

Kiosks
Vending-machine like movie dispensers are popping up in malls, supermarkets, and drugstores. Consumers can browse the machine's selection and pay with their credit card. Consumer Reports' survey found that Redbox, the biggest video-rental kiosk company, got top marks for price and convenience. Movies cost $1 per night and Redbox allows consumers to reserve movies online before picking them up at a nearby kiosk. For the most part, consumers are likely to find a random selection of the most mainstream movies in Redbox kiosks. Readers rated it worse than average for selection.

Video on Demand
Despite the seeming convenience of video on demand (VOD) services offered by cable, satellite and phone company TV service providers, they trailed other options in satisfaction as far as price and selection. Additionally, Consumer Reports' survey suggests that this option tends to be a supplement to rather than a replacement for other ways to rent movies, perhaps as a way to get the newest titles.

VOD offerings comprise movies, TV episodes, and other programs that consumers can order. Once the selection has been started, there's typically a 24-hour viewing window during which the program can be paused, stopped and viewed again. VOD titles, generally priced between $2 and $5 are offered in standard and high definition. Most cable companies offer some free VOD titles, generally either kids programs or older movies. Cable still has the edge in VOD, but the newer, fiber-optic TV services, such as Verizon FiOs and AT&T's U-verse, are now competitive with cable services.

For all types of TV providers, satisfaction with VOD picture and sound quality was on par with other rental options, and subscribers found it easy to order movies on demand. To enjoy VOD, consumers must subscribe to the service provider's monthly TV service.

Walk-Ins
If in-person service is a priority, Consumer Reports recommends local independent, non-chain stores and Family Video, a walk-in chain with 550 locations in 18 states. Survey results showed that Family Video was better than average for price and that independent stores offered superior customized, customer-oriented service.

The complete report and Ratings of video rental services are available in the March 2009 issue of Consumer Reports, wherever magazines are sold. Portions of the story are available for free online at www.ConsumerReports.org.

TSUTAYA online Corporation (Head Office: Shibuya-ku, Tokyo, CEO: Hiroshi Yamaji) of TSUTAYA group will start the industry’s first download distribution, [TSUTAYA TV Internet Sales Service] (acTVila Internet Video Download Service) from Friday, December 19th, 2008 on "TSUTAYA TV on acTVila ", a high-definition movie distribution service developed on [acTVila], the Internet service for digital TV management owned by acTVila Corporation, (Head Office: Minato-ku, Tokyo. CEO: Koichi Sawane). At the same time, TSUTAYA online Corporation is planning to distribute about 400 movies and TV dramas including some of Hollywood’s Major Film Studios’ products in the world’s first, high-definition copying to removal media including Blu-ray Discs.

TSUTAYA group creates a transition bridge between DVDs to Blu-ray Discs by providing merit of high-definition videos to wide range of customers via our service while sophisticated and multifunctional digital appliances become more popular and high-definition videos like Blu-ray Discs become new standard in recent years.

■ Download distribution service in high-definition
[TSUTAYA TV Internet Sales Service] and [TSUTAYA TV Internet Rental Service]
TSUTAYA TV has been promoting [TSUTAYA TV Streaming Rental Service] (acTVila High-vision Video Online Rental Service), a high-definition video streaming service for digital appliance*4 that support [acTVila Online Video Rental Service] since June 6th. From December 19th, TSUTAYA will start [TSUTAYA TV Internet Sales Service] and [TSUTAYA TV Internet Rental Service] that allow customers to enjoy high quality and high-definition videos with digital appliances that support [acTVila Online Video Rental Service / acTVila Internet Video Download Service].

■ Copy to media including Blu-ray Disc
TSUTAYA TV will start [TSUTAYA TV Internet Sales Service], the service that allows customers to copy high-definition videos into removable discs including Blu-ray Discs and iVDR-S. This service achieves to provide customers to enjoy wonderful environment that fits their life style, "anytime" and "anywhere". Movies and TV series that will be distributed on [TSUTAYA TV Internet Sales Service] and [TSUTAYA TV Internet Rental Service] includes some of Hollywood’s Major Film Studios’*5 products including the works of Paramount Digital Entertainment International, THE WALT DISNEY COMPANY (JAPAN) LTD., Warner Entertainment Japan Inc., NBC Universal International Television Distribution. About 400 works including [HEROES] series 1 and 2, [LOST] series 1 to 3, [Desperate Housewives] series 1 to 3, [CLOVERFIELD], and [Dreamgirls] will be distributed in high-definition by the end of December and more and more sequentially.

TSUTAYA group is actively working on the integration of TSUTAYA Internet service and TSUTAYA stores under the theme of "ALL TSUTAYA" to provide the best value to the customers to enjoy entertainment contents including movies, music, games, and books in various ways.