Still, the movie industry shows lukewarm interest in embracing E-business models until it gets better copy protection. The equation is simple: The ability of pirates to upload films to file-sharing services makes it extremely difficult for subscription services and pay-per-download stores to succeed. But the biggest worry isn't those bootlegging moviegoers using video cameras to make sketchy copies of first-run movies. Most of Hollywood's concern and energy are devoted to copy protection in the home.
That's where the relationship between moviemakers and tech companies takes center stage. Intel is sympathetic to the entertainment industry's plight--to a point, says Don Whiteside, who, as VP of legal and government affairs, manages the chipmaker's relationships with the movie and music industries. "All of our industries have a strong foundation in intellectual property, and we all have a fundamental interest in making sure our intellectual property is protected," he says. "Where we diverge is in what role one industry has in protecting the other's interests." Hollywood has accused IT manufacturers of capitalizing on the production of piracy tools, but the business obligation is to deliver capabilities consumers want, Whiteside says. "It's not generally our role as an IT company to be enforcing control of consumer behavior on the Internet."
IBM promotes "content enablement," in which algorithms embedded in content would detect network characteristics to determine what users can do with the content, rather than what they can't do. Bottom line: All digital-entertainment stakeholders will have to make compromises in order to get technologies to market in time to capitalize on the opportunity facing Hollywood, says Steve Canepa, VP of IBM's global media and entertainment business. "Witness what's happened in the music industry," he says. "Billions of dollars have been lost from a commercial model into a noncommercial model."
Studios will do whatever is needed to protect their content, says Hunt, chief technology officer at the Motion Picture Association of America.
Photo by Diana Koenigsberg
Agreements between these groups are needed before we'll enter a new era in which the Internet, advanced PCs, home-entertainment networks, and digital devices provide a level of convenience that's technically feasible today but science fiction from a business-model standpoint. "The sense of urgency at the moment seems to be about controlling the computing rather than just getting out there and seeing how [digital-distribution models] work," says Jim Burger, an attorney with the law firm of Dow Lohnes & Albertson, who represents technology vendors.
It's a plot waiting for a Hollywood ending: The seemingly impossible pair finds a way to live happily ever after. But for now, both sides are still waiting.