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Friday, December 22, 2006

Ten Pivotal Events of 2006, from the Intersection of Entertainment and Technology

I’m getting ready to head off on vacation Friday afternoon, so from then until January 2nd, posting here will be (hopefully) light.

But before I leave, I wanted to list what I think have been the ten most important events of the year, at least from a CinemaTech perspective. Here’s how I’d frame the list: as the worlds of technology and entertainment increasingly overlap, what were the most significant happenings of 2006? And what sort of future do they point toward?

1. “The Extreme Diet Coke and Mentos Experiments.”

It wasn’t the Web’s most-viewed video of 2006, but by virtue of generating more than $30,000 in advertising revenue for its creators, Fritz Grobe and Stephen Voltz, the array of Bellagio-like soda fountains was the year’s most significant snippet of “user-generated content.” It proved that creative unknowns (in rural Maine, no less) can earn a return from video on the Internet – not to mention get booked on “Letterman,” NPR, and “The Today Show.” (Video of Fritz Grobe talking about the video is here.)

The Future: More opportunities for creative people to make money from viral video content on the Web, and to stretch the boundaries of what networks and studios have traditionally considered entertainment.

2. “Bubble” and “10 Items or Less”

Released in January and December, the two low-budget films from directors Steven Soderbergh and Brad Silberling were attempts to change the established practice of maintaining separate “release windows” for movies: first theaters, then DVD, pay-per-view, premium cable, and free TV. Neither experiment was a resounding success, but they were only the first creaks in a tectonic shift that will likely eliminate the aggravating lag between the time that movies leave theaters and when they show up on home video. (And help studios cut down on their marketing spending, since they won’t have to remind us about the movie when it finally appears on DVD.)

The Future: A shorter window of theatrical exclusivity (one week to one month), after which point a movie will be available in any form a consumer might want to consume it – from a giant-screen, high-definition LCD display to an iPod screen. This would preserve the option of seeing movies in a theater, which ensures that theaters will survive – they’ll just be cycling through more movies each year than they do today.

3. AccessIT Digitizes 1000 Movie Screens, and UltraStar is the First Chain to Go 100 Percent Digital

The digital cinema revolution, heralded many times since the late 1990s, finally gained real momentum in 2006, with AccessIT installing 1000 digital cinema systems in the U.S., and the southern California chain UltraStar announcing in February that it was the first to have put digital projectors in all 102 of its projection booths. Technicolor Digital Cinema also got into gear in 2006, though National CineMedia, responsible for setting the digital cinema strategy for the majority of screens in the U.S., still seems to be in neutral.

The Future: The smarter chains, like UltraStar, will start marketing digital cinema as a premium experience, pulling patrons from theaters that are still unspooling scratched-up celluloid. That’ll force others to upgrade, and the digital cinema conversion process will gain speed in 2007 and 2008. Some of the sharper exhibitors will take advantage of digital cinema to be more flexible in their programming, giving their patrons more choice about what they can see at the neighborhood Cineplex – and perhaps even permitting them to program it themselves on occasion.

4. Robert Greenwald Uses the Web to Raise $220,000 in Funding for "Iraq for Sale"

When the documentarian Robert Greenwald realized he needed more funding to get his movie about alleged war profiteering in Iraq finished before the 2006 elections, he turned to the Web. Of the 3,000 people who gave money via his Brave New Films Web site, most plinked in just $25 or $50, Greenwald told me. Everyone who contributed got a producer’s credit. And the amount raised was a significant chunk of the movie’s $775,000 budget.

The Future: Other filmmakers might tap into interest groups or fans of their prior work to help cover the costs of future projects, perhaps by pre-purchasing DVDs or digital downloads of the finished product, or by buying a producer credit that might entitle them to a small share of any eventual profits. Want to see a sequel made? Pony up.

5. Mash-Ups and Remixes

Warner Bros. invited Internet users to re-edit the trailer for the Richard Linklater film “A Scanner Darkly,” offering prizes to those who cut the best versions, including a trip to the movie’s premiere. This was a tentative first step toward allowing audiences to play with the raw materials of a movie, and Warner Bros., for the price of creating one trailer, sparked the creation of hundreds of trailers that circulated around the Web.

The Future: Some filmmakers may allow audiences to have access to all of the footage shot for a feature, producing their own alternative cuts – shorter, longer, with different narrative structures. Eventually, studios might sell (or allow the “volunteer editors” to sell) these different versions of the movie, as long as there was a revenue split deemed equitable to both sides. Why not have multiple products in the market – and the chance to sell a few different versions of a movie to its fans – rather than just one? (Oh, yes – directorial vision. That’s right.)

6. Web sites including iTunes, Amazon, Vongo, and Guba offer full-length downloadable features, joining CinemaNow and Movielink

2006 was the first year you could purchase a digital version of a movie to own (rather than just rent one), and the first year that some sites allowed you to burn a downloaded movie onto a DVD. The process is still too complicated, and the pricing isn't enough of a discount from the DVD price. (That's thanks, in part, to pressure exerted on the studios by big retailers like Wal-Mart.) Best pricing offer so far: Vongo’s all-you-can watch for $9.99 a month.

The Future: Movies get easier to download to PCs and laptops, and also easier to "beam" directly to boxes that sit atop the television set, like an Akimbo or a TiVo. That, along with more reasonable pricing, will usher in a world where truly any movie is available on demand. I also think we'll eventually see studios offering to give us access to fragments of movies, perhaps supported by advertising, or sold for small change... allowing a blogger to incorporate a short sequence from the original "King Kong" into a review of the Peter Jackson 2005 version, or allowing a movie fan to create a site dedicated to the best car chases of all time, and embed each one in the site. Why force people to buy the whole thing, when you can generate additional revenue monetizing movies by the slice?

7. Google buys YouTube

The $1.65 billion deal happened in October, and I suspect execs at the two companies are still trying to figure out the best ways to work together, new ways to partner with media companies rather than responding to lawsuits, and new ways to monetize all of those minutes of video being watched on YouTube. Even if YouTube eventually fades away (someone is going to introduce a way to watch video online that doesn’t make you feel like you’re viewing it through a Vaseline-smeared window, and it may not be YouTube), the site was the first to make it simple to publish, view, and comment on video clips – and that’s a big deal. YouTube also pioneered video-as-conversation, where one user would post a short video, and others in the community would respond with videos of their own.

The Future: I’m not sure we’ll need a central repository of video like YouTube. Video players will be embedded everywhere – and clips we want to watch will come to us through subscriptions, feeds, and sites that we visit regularly, rather than requiring that we go to a site like YouTube and look for what we want. With that model, there’s not much benefit that accrues to the site hosting the video – unless that site inserts advertising into the clip, or can somehow persuade me to visit that site when I’m done watching.

8. Disney buys Pixar

Since the release of “Toy Story” in 1995, Pixar had become Disney’s most reliable supplier of hit movies. The lesson here: be consistently great at what you do, and unrelentingly creative, and before long you’ll become indispensable. Disney couldn’t afford not to buy Pixar, especially if some other studio did. The price tag: $7.4 billion. Disney also handed over the reins to its entire animation operation to Pixar execs Ed Catmull and John Lasseter.

The Future: The barriers to making a good-looking computer-animated movie continue to drop. You no longer need an established studio; “Happy Feet” director George Miller built one from scratch just for his penguin pic. Lower barriers and lots of new competitors mean the business of making CG features is going to get insanely competitive for everybody… including Pixar, DreamWorks, and Blue Sky, the troika that have owned the market for the past decade. One way Disney/Pixar will respond to the competition: returning to making the occasional old-school, 2-D animated movie. One, "The Frog Princess," is already in development.

9. Digital Cinematography Creeps into the Mainstream

This was the first year that a significant number of big-budget movies were shot using digital cameras (mostly the Panavision Genesis). The list included “Apocalypto,” “Flyboys,” “Superman Returns,” “Miami Vice,” “Click,” and “Scary Movie 4.” Panavision CEO Bob Beitcher told me the company doesn’t plan to develop any new film cameras. Meanwhile, Red Digital Cinema was working on a high-end digital camera with a low-end price, and Vincent Pace, Jim Cameron, and Sony Electronics were beginning to market the Fusion digital camera for shooting 3-D features. This year, it was used in Canada on the set of “Journey to the Center of the Earth.”

The Future: 2006 will be seen as a tipping point for the acceptance of digital cinematography in Hollywood, and in five years, film will be used on movie sets predominantly as an aesthetic choice, rather than the default. 3-D films will increasingly be shot that way, rather than converted to 3-D after principal photography is completed (as was the case with a 3-D version of “Superman Returns,” shot in 2-D with the Genesis.)

10. Blu-ray and HD DVD debut; consumers yawn

Introducing two competing, incompatible formats for high-definition DVDs was a lose-lose proposition. For the manufacturers, sales have been slow as consumers wait to see which format will win out. And the consumers who have waded in early risk being stuck with a collection of obsolete discs if it turns out they’ve chosen the wrong format. This was corporate idiocy at its worst.

The Future: I wish I were enough of an optimist to predict that pointless standards wars would cease… but in digital media, we’re already seeing the emergence of incompatible standards. Just try playing a TV show or movie purchased from iTunes on a device other than an iPod.

    That’s my list. Any quibbles? Anything to add? Would you rank them differently? Please post a comment… and enjoy the holidays.

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