Digital Video Downloads 2010: Format War in the Cloud or a Perfect Storm?

Monday January 25, 2010 – Antonette Goroch

With VHS, DVD and Blu-ray formats now battles of the past, are digital video downloads set to be the next big format war in the ongoing evolution of digital entertainment? Maybe not.

This month’s announcement at CES from the Digital Entertainment Content Ecosystem (DECE) consortium of both new members and some vendor selections for DRM/content management again puts a spotlight on the necessary infrastructure for mainstream digital video delivery over the Internet. DECE, backed by 48 members including notables such as Sony, Warner Bros, Cisco, Motorola, Widevine and DivX offers a competing ecosystem to Disney’s recently announced Keychest. Both efforts are cloud-based digital ecosystems meant to support the notion of “buy once, play everywhere” digital video delivery. Will this set the stage for an ecosystem war? If so, the stakes are high as content owners are trying to hit the right chord for electronic distribution to combat a gradual decline in DVD sales.

Source: Digital Tech Consulting

But a crippling format/ecosystem war may not necessarily be a foregone conclusion.. Though some degree of standardization is necessary for the broad industry support needed to “buy once play everywhere”, there is an increasing tolerance for multiplatform solutions in the marketplace. Theoretically, two ecosystems could coexist peacefully and grow the market for everyone, provided content providers don’t restrict their access to one format or another, thus lessening the value of both.

Recent activity by content providers suggests this may be the case, since they have adopted a strategy of offering programming to many different outlets via differing business models and technologies, rather than locking into just one. Should this tendency continue, the coming year could trigger a radically different landscape for digital entertainment content and its delivery, as these cloud based ecosystems significantly up the value proposition (on the part of both consumers and content providers) for digital downloads.

What Does The e-Book Want To Do When It Grows Up?

Monday January 18, 2010 – Myra Moore

You want to read the book, see the movie, or play the game? How about all three at the same time? Or, maybe little bites of all three at once. It sounds ridiculous but it’s plausible that the embryonic e-book market could be moving in that direction.

Until now, the e-book and the corresponding reader were pretty cut and dry – a good facsimile of printed text (in shades of gray) on an electronic device. Avid book readers and gadget geeks are the target consumer and several million of us have taken the bait. But now the apparently irresistible urge to turn the e-reader into another electronic Swiss army knife has officially begun.

It was inevitable. First, you add the ability to play back mp3 audio files and load up some photos and the features check -box list begins to grow. The rumors of an Apple device/tablet that includes numerous electronic Swiss army knife implements right down to video playback and 3D capabilities, begs the question: What is an e-book reader, and maybe more importantly, what is an e-book?

We have yet to see an application where text, audio and video have been combined into a single electronic book/program (or whatever we’re going to call another potentially new media format) for view on an e-book reader. A U.S. startup, Spring Design, announced it will sell an e-reader this year that plays video. It looks like the device keeps up a wall between the video playback (in a small screen at the bottom of the device) and the reading of an e-book.

So I don’t think we have to worry about naming this new hybrid media anytime soon. But the ability to cram multiple promotional messages (read the book! See the movie! Buy the sound track! Play the game! Just push this button!) into one electronic expression has to have marketing execs salivating. Although it sounds like promotional Nirvana, the technology isn’t fully baked enough to enable this kind of application just yet.

My bet is that technology won’t be the big barrier though. Business models, content ownership, and copy rights hold the greatest promise for inhibiting the production and distribution of hybrid supercharged e-books. Will a publisher, movie studio, music label and content distributor each take a cut of the sale? Will there be revenue sharing among all if a consumer buys another product promoted in the e-book/program? How will all parties that contributed content agree on content security and management? Digital Rights Management (DRM) promises to be an especially thorny issue especially if the supercharged device has e-mail capabilities. Getting all the kids to play nice in the sand box will either take the aplomb of a great diplomat or a huge contract so heavy the involved parties will want to review it on an e-reader.

However this new kind of media and device get created, I’m not sure the avid book readers now buying the Kindle and Sony Reader are the likely buyers. Although today’s e-readers incorporate truly innovative technology that mimics the printed page and displays that page with minimal power, they’re pretty low-tech devices. Look for a lot of trial-and-error marketing as the stake holders try to figure out what they’re selling and to whom.

Bringing 3D TV Into the Home

Monday January 11, 2010 - Shelby Cunningham

You couldn’t throw a stick without hitting a 3D TV demo at CES last week. If you wanted to get to get a proper demo, though, you had to wear special glasses. The consumer electronics makers say 3D is so compelling that consumers won’t mind the glasses.

I’m not sure wearing battery operated glasses while sitting in your own living room may be an attractive situation to some. I know that I like to multitask while watching TV and movies, and I know I'm not the only one who does that. And if you're watching TV while wearing special glasses you can't frequently gaze over to the laptop or smartphone.

The one home entertainment sector that I can see bringing 3D TV into the home quickly and with high numbers is gaming. My reason for this is simple: You are generally fully focused on the screen at all times while playing a game. You have no desire to check Twitter or send an email or Google a random actor's name in the middle of a game and are, therefore, going to have no problem keeping this pair of glasses on and looking at the screen.

Sony announced pre-CES that the PS3 would be able to play 3D games when hooked up to a 3D TV thanks to a simple firmware update. While it makes sense that the PS3 will be the first to hit the 3D gaming circuit (they even had demos at CES) because of Sony's line of 3D TVs, the Xbox 360 probably won't be too far behind since the console is already 3D compatible. Now it's just up to the game makers to create incredible 3D games, as well as the consumers to want to buy the TVs and glasses.

Wireless HDMI: Bigger than 3D

Monday January 4, 2010 – Stewart Wolpin

While CES will be replete with gaudy 3D HDTV and 3D Blu-ray demonstrations, likely complete with Avatar and Up! clips, a far more consequential innovation will be purposefully well-hidden – wireless HDMI.

Losing the annoying trailing HDMI cable connecting a consumer's A/V stack to their wall-mounted HDTV is an interior decorator's dream, and so a wireless solution is likely to prove far more popular in the real world than 3D.

Unfortunately, there's more than one way to skin this particular cable cat: Wireless HD (WiHD), Wireless Home Digital Interface (WHDI) and WiGig. A handful of companies are backing multiple consortiums: Hitachi, LG, Samsung, Sharp and Sony are all listed as supporters for both WiHD and WHDI, for instance; LG, Samsung and Panasonic are supporters of all three. Chip makers also are doubling up; Broadcom and Intel both are supporters of WiHD and WiGig.

While all three consortiums seek to provide a wireless uncompressed 1080p HDMI connection, each uses slightly different technologies and envisions slightly different usage cases.

WiHD has the simplest mission – provide a wireless HDMI replacement over the recently unlicensed 60 GHz band.

WiGig also operates in the 60 GHz band, but is a more multi-purpose and interoperable standard. WiGig is an extension of standard 802.11 WiFi with complete backward compatibility, the goal to provide a higher bandwidth – 7 gbps, 10 times faster than 802.11n – wireless connection for high-bandwidth functions such as transferring HD video from a camera to a PC.

Both WiHD and WiGig are short-range (10 meter) same-room technologies. Neither is strictly line-of-sight; if you stack your A/V gear underneath or next to your HDTV, the wireless stream will bounce off nearby walls to your HDTV to complete the wireless circuit. Implementation in larger rooms, therefore, could be challenging.

WHDI is a slightly different wireless animal; it aims to connect all devices to any display in your home. WHDI operates in the more flexible 5 GHz band (just like 802.11n), so it does not require line-of-sight and has an up-to 30-meter range, expanding equipment placement flexibility to multiple rooms.

Choosing Sides

At CEDIA a few months back, three HDTV makers – Sony, LG and Panasonic – all exhibited WiHD-enabled HDTVs, but none of these models are widely available.

But next week, several HDTV makers will unveil a slew of sets endowed with WHDI; most of these models will require the purchase of a separate wireless kit consisting of a wireless dongle for the TV and a transceiver STB, likely priced below $400.

The WiGig wireless HDMI specification isn't due until the end of 2010 at the earliest, and the first WiGig-enabled products of any kind likely won't be in stores until 2011.

There's no question consumers will find losing that dangling HDMI cable compelling. Even though a certain amount of consumer confusion is likely to ensue as WHDI and WiHD and its HDTV partners fire multiple marketing salvos when the latest wireless sets hit the market this spring, practical wireless HDMI is bound to be far more popular than the flashier 3D.