| The victory of Sony 's new Blu–ray high–definition disc over a rival format, Toshiba 's HD DVD, masks a problem facing the studios — the overall decline of the DVD market. Domestic DVD sales fell 3.2 percent last year, according to Adams Media Research , the first annual drop in the medium's history. Adams projects another decline in 2008, and a similar dip for 2009. So instead of celebrating the Blu–ray format, the studios are scrambling to introduce an array of initiatives aimed at propping up the broader market. Some efforts, like the addition of new interactive features and changes in how DVDs are packaged and promoted, are intended to prevent further market erosion while nurturing Blu–ray, the NY Times reports.
But media companies are also introducing technology that they hope will solve the more difficult tasks of generating growth and delaying the obsolescence of DVD altogether. DVD sales are sagging for various reasons, including a flooded marketplace and competition for leisure time. But the Internet is perhaps the biggest enemy, report Times writers Brooks Barnes and Matt Richtel .
Technology companies have watered down the DVD market by aggressively pushing Internet downloads. Apple 's iTunes now offers downloads of 500 movies and last month started renting titles. Meanwhile, telecommunications providers like Time Warner and Comcast are pushing their faster broadband lines by promoting them as capable of delivering fast downloads.
Movie studios are fighting back by taking a page from the Internet playbook. Indeed, the centerpiece of the market rejuvenation effort is something 20th Century Fox calls "digital copy." Fox DVDs, starting last month, now come with an additional disc holding a digital file of the title. Consumers can download the file to a computer in about five minutes — far less time than via the Internet — and then watch the movie there or transfer it to their iPod .
"This puts the DVD at the center of the digital revolution and returns the business to a growth trajectory," said Mike Dunn , the president of 20th Century Fox Home Entertainment. Sony Pictures Entertainment , Universal Studios , Walt Disney and Warner Brothers are all pursuing their own versions of the idea.
But John Freeman , an industry analyst, sees the effort as a stall tactic. Although digital copies are "a step forward," he told the Times , that step is tantamount to Hollywood admitting that its lucrative hard–goods business is growing obsolete. Today, digital files on discs; tomorrow, mass downloading straight from the Internet. |
