If Nikki Finke hadn’t invented it and wasn’t so fond of litigation, I would’ve thrown a big TOLDJA! in the headline. Years ago I was writing about this inevitability and being laughed at. And at the end of this snippet, I’m going to go even further out on a limb and touch the third rail neither Hollywood nor the entertainment media that loves them dares touch (hint: movies suck today).

Also, I’m well aware that I frequently touch on this subject, but from the moment I realized video distribution was inevitably headed online, I also realized that this was as seismic a change in the industry as the invention of home video itself. You see, this is where the power of a very few ends — this is where the revolution really begins. Anyone can make a film nowadays, but the bottleneck is still distribution. You have a handful of distribution forces — all of whom are hostile to our beliefs and values, and I’m convinced that what we’re seeing unfold on an almost daily basis is going to change all of that. Not today and not even tomorrow. But  online video streaming (like the ability to self-publish a novel)  means that the prohibitive costs of distribution are about to be a thing of the past. The very few with the power are about to lose that power. The Man is going down.

We live in an amazing era where the ideal of democracy is becoming more of a reality. Music and the news media have already been splintered by the ability of the Internet to undermine the corrupt guardians of those institutions. And now it’s happening in the Left’s most lavish and cherished stronghold: The sound and fury of the motion picture.

This isn’t a technological revolution, it’s a freedom revolution powered by technology, where every twist and turn fascinates and must be encouraged.

L.A. Times:

Across Hollywood, a quiet revolution is brewing that’s about to transform living rooms around the world.

After desperate attempts to prop up the industry’s once-thriving DVD business, studio executives now believe the only hope of turning around a 40% decline in home entertainment revenue lies in rapidly accelerating the delivery of movies over the Internet.

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Courtesy of a superb story from The Wrap’s Brent Lang, we get a fascinating look at the possible future of the ever-changing home entertainment world. Hollywood’s biggest problem right now is that consumers are moving away from purchasing DVDs and towards dollar rentals at their local Redbox, even cheaper rentals at Netflix (if you use it as often as I do), and the crack-cocaine of convenience known as Netflix Streaming. Last year DVD sales collapsed 44% and wholesale revenues plummeted to just $4.5 billion from nearly $8 billion. In worse news, Bluray is looking like the new laserdisc — a nice format for hardcore fanatics but not something that’s going to catch completely on with the mainstream.

Studios are losing money like crazy due to this new non-purchasing trend and the hope behind Ultraviolet is that it will put customers back in the frame of mind of owning their home video. Essentially, this new technology will allow you to watch whatever you purchase on your television, PC and mobile device. This convenience appears to be the Big Pitch. I’m not sure it’s enough.  

 The home entertainment market has been shrinking at dizzying speed, but Hollywood thinks that it may have finally found a way to stop the trend before irrevocable harm.  

The answer, studios believe, is in the cloud.

In coming months, most major studios will launch UltraViolet, a system designed to let consumers stream and store movies and TV shows they purchase on multiple devices. It’s the next step beyond Apple and Amazon’s digital cloud services, which allow users to access music and eBooks on multiple devices. …

Reinvigorating the sell-through model is critically important because studios make roughly $15 on every movie they sell versus a few dollars on each one they rent. The studios expected Blu-ray to do that but the phenomenal success of Netflix and Redbox, both of which have made streaming or renting movies easier than ever, has cut into the sell-through business.

So that’s the problem and proposed solution in a nutshell. If it is what I think it is, here’s why I see Ultraviolet going nowehere::

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Hollywood and those who write about it need to face a very simple fact. Yes, new technologies like Netflix Streaming and outlets like Redbox are most certainly a part of the reason DVD sales are slumping. But another reason for the slump is the quality of today’s motion pictures. It’s just a fact that Hollywood is producing fewer films we want to see again and/or own forever.

The studios might be able to bait us into turning something like “The Green Hornet” into an opening weekend hit, but unlike anytime in my life, walking out of a theatre wanting to see “that” movie again is now the rare exception as opposed to the rule.

With video delivery technologies emerging in ways no one expects on an almost daily basis, there’s no silver bullett to solving the very serious DVD sales problem. But something that most certainly would help would be to make more films we’re actually excited about seeing again and again. 

Variety:

Consumers keep spending less on DVD as they switch over to Blu-ray, streaming services like Netflix and VOD, with the aging disc format earning 44% less last year than it did in 2009, despite strong sales for Fox’s “Avatar.”

The wholesale value of 415 titles released on DVD in 2010 fell to $4.47 billion from $7.97 billion in ‘09, a new report by SNL Kagan reports.

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The Los Angeles Times:

“For those who like renting movies, Hollywood may soon have a message: Prepare to wait.

“In an effort to push consumers toward buying more movies, some major film studios are considering a new policy that would block DVDs from being offered for rental until several weeks after going on sale.

“Under the plan, new DVD releases would be available on a purchase-only basis for a few weeks, after which time companies such as Blockbuster Inc. and Netflix Inc. would be allowed to rent the DVDs to their customers. The move comes as the studios are grappling with sharply declining DVD revenue, which has long propped up the movie business.

“Reed Hastings, chief executive of DVD-by-mail company Netflix, revealed that he had discussed delayed-rental proposals with several of his biggest suppliers. People close to the situation at several studios confirmed that such plans were under consideration and probably would take effect next year. (more…)