Monday October 26, 2009 – Antonette Goroch
Disney took the wraps off its Keychest initiative for online digital distribution last week, as the company seeks to temper the effects of the growing slump in DVD sales (down as much as 25% at some studios). While this particular initiative seems unlikely to achieve that outcome, the shift in thinking from device based content security to device independent content security is pretty radical from such a major media player, and bodes well for the future of digital distribution.
Disney’s technology, which it plans to formally unveil next month, enables a consumer to buy permanent access to a title so that it can be played back across multiple devices, such as TVs, PCs or mobile devices, with the content housed in central databases rather than a consumer’s hard drive. A user is issued a “key” which checks in with a central database of ownership rights. With the system, Disney hopes to address one of the biggest issues facing widespread online digital distribution which is the ability to playback content securely in multiple digital contexts.
The challenges facing broad adoption of the initiative will be many. At a very basic level, because of the nature of any connected device strategy, adoption has to occur among a huge range of companies and industries. It seems unlikely that enough of a broad base of adoption can occur among so many competing players with different interests—many of whom will likely be wary of Disney having such a large degree of control over what would be vast databases of content usage information.
Still, the shift in thinking on Disney’s part is significant, and may ultimately be a key factor in reclaiming those falling DVD revenues. For too long major studios have tried to lock down content to specific devices and platforms to keep them secure, limiting their utility in an increasingly connected media environment. If consumers can’t easily play their content on multiple devices, they may balk at buying in the first place. Successful digital delivery, and its monetization for the Hollywood aftermarket, must be predicated on usage rights being attached to content not devices. Disney’s shift is a positive step toward building coalitions among companies with varying agendas. But they all have one shared agenda – sell as much content as they can. That’s kind of hard to do if it’s all locked down.
