Will Hollywood's 'UltraViolet' plan replace the DVD?

A group of film studios, consumer electronics companies, software makers, and ISPs say they are offering consumers an easier way to store, view, and access content. Critics say it's PlaysForSure all over again.

A group of stakeholders in the entertainment industry are poised to make a important sales pitch to consumers concerning the way they buy and watch movies and TV shows.

Warner Bros. Entertainment, Netflix, Microsoft, Hewlett-Packard, and Best Buy are among the members of a consortium called the Digital Entertainment Content Ecosystem, or DECE, which has come up with a set of standards and specifications designed to make approved digital content playable on certified devices. DECE calls the technology UltraViolet.

"The DVD was the most successful consumer product launch ever in history...it was an open platform, meaning their was one standard, every manufacturer made it, all the content on the planet was available for it. We don't see that model currently.
--Barry McCarthy, former Netflix CFO

DECE announced this evening at the 2011 CES in Las Vegas that it expects companies that have licensed UltraViolet to begin rolling out products and services beginning this summer. DECE said it expects UltraViolet will appear in the United Kingdom and Canada later in the year. If you believe that the DVD and physical media are in their twilight years, then UltraViolet's backers appear to be laying the groundwork for the next home-video format.

The pitch from UltraViolet's supporters goes something like this: users could acquire what are essentially lifetime rights to movies and shows. The rights to certain content could be easily transferred from one service provider to another if the owner chooses to switch or if one the services closes down. Owners wouldn't have to fear losing or breaking their movies anymore because all the material would live in the cloud and be accessible via Web-connected TVs, handhelds, computers, and set-top boxes. DECE said families who use UltraViolet "will be able to create an account for up to six members who can access the household's UltraViolet movies, TV and other entertainment...consumers will also be able to register up to 12 devices" so UltraViolet content can be easily downloaded to those devices or shared between them."

But here's the rub: the content will be swaddled in digital rights management, software designed to prevent unauthorized copying. While DECE played up the number of accounts and devices UltraViolet users will have access to, critics will likely scoff. Expect many from the tech sector to accuse UltraViolet's makers of trying to lock up consumers' content--again.

Naysayers have argued that the Internet helped consumers seize control of media by enabling them to share digital films, music, and books as many times as they want and play it on whatever devices they want. Michael Robertson, the longtime technology entrepreneur who founded pioneering music service MP3.com and has worked with digital lockers for nearly a decade, is among UltraViolet's doubters.

"I think the era of trying to cram formats and standards down the throats of consumers is over," Robertson said. "When we live in a world where users are one click way from BitTorrent and from obtaining a high-quality film copy that can be played on any device, I don't see UltraViolet, with its restrictions and limitations, winning consumers back. Consumers just have too much power."

DVDs were once white hot consumer goods. For a mini history lesson, click on the story from 1999 about sales projections. Screenshot by Greg Sandoval/CNET

Mitch Singer, chief technology officer at Sony Pictures, a DECE member, says there is no conspiracy to snatch away control from consumers. He said UltraViolet is a way to make digital movies and TV shows more appealing by making them as simple to view, store, and transfer as the DVD. He notes history has shown that the lack of open standards only hurts consumers.

"If every brick-and-mortar retailer would have had their own [DVD] format that wouldn't have made any sense at all," Singer said. "But digital rolled out exactly that way. It rolled out in a series of fragmented silos."

This wasn't unprecedented. Singer said plenty of innovative products debuted this way, but then quickly changed.

"Xerox fax machines in the early days could only fax documents if the machine on the other side was Xerox," Singer said. "ATM machines would only give money to cardholders who belonged to the same network...but over time if you want to see any substantial growth you have to open it up."

Barry McCarthy, Netflix's CFO the past decade until leaving the company last month, predicted two years ago there would be a need to create standards for the Web distribution of movies and he suggested the plan would be modeled after the DVD.

"The DVD was the most successful consumer product launch ever in history measured in terms of growth in the number of units in U.S. homes," McCarthy told the Unofficial Stanford blog in 2008. "It was five years to 50 percent household penetration and it was an open platform, meaning their was one standard, every manufacturer made it...all the content on the planet was available for it. We don't see that model currently [in Web distribution of movies]. Apple has a device...but it only talks to the Apple Web site. It doesn't talk to Amazon. It doesn't talk to the Netflix site...And if there's a Netflix device that we make or someone makes for us that runs the Netflix application that gets you to a Netflix Web site, it's only going to talk to our Website. In a perfect world, there would be open platforms."

Robertson said the UltraViolet effort looks very much like PlaysForSure, the DRM certification program that Microsoft tried to establish for devices and content services in 2004. It failed to take off . Josh Martin was one of those who were critical of PlaysForSure but the mobile and video analyst for research group Strategy Analytics argues UltraViolet is a superior strategy.

"I think the era of trying to cram formats and standards down the throats of consumers is over."
--Michael Robertson, entrepreneur

Martin said UltraViolet could work because the key players appear to have learned from past mistakes.

Martin wrote in October that under UltraViolet's plan, content "is not locked to a specific device but to a user (or a family of users)." He said that this means users can transfer content to a wide array of devices and that makes UltraViolet content more flexible than the DVD.

The most important difference between Ultraviolet and PlaysForSure, according to Martin, is that UltraViolet supports various DRM schemes and either "changes the DRM 'wrapper' when a file is transferred between devices," Martin wrote, "or allows a user to download a new file that is suitable for that specific device (i.e. you wouldn't want to transfer a 1080p file to your phone). This increases utility while reducing end user complexity."

The other big knock on UltraViolet is that Apple and Disney haven't signed on. How can a standards agreement be any good if consumers aren't able to watch movies from one of the most important film studios or play content obtained from iTunes?

Singer, said UltraViolet movies and TV shows will be available on the iPad and iPhone because those devices are compatible with an app created by Netflix, an UltraViolet partner. But Singer concedes video purchased from iTunes currently won't play on UltraViolet devices.

About the absence of Disney, Martin said "In order for consumers to believe in this technology, all major content owners must be on board and as of today they are not."

 

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