Richard Shim
The closing session of the US National Cable & Telecommunications Association on Tuesday pitted executives from rival media giants -- NBC Universal, News Corporation, Time Warner and Walt Disney -- against one another in a panel on the changing entertainment industry. However, in most cases they agreed on the impact of many new technologies, with the consensus being that older technologies, such as DVDs, are the current money makers, but they expect that to change."Our DVD sales make more money than Comcast, which is why they wanted to buy us," said Bob Iger, Disney's chief operating officer, referring to Comcast's failed acquisition attempt of Disney. "Those new technologies (video on demand, digital video recorders and high-definition television) will become good businesses, but they aren't now."
Seasons of television shows on DVD make up the fastest-growing segment in Time Warner's DVD sales, Time Warner's Jeff Bewkes said. News Corporation's president, Peter Chernin, estimated that his company did $700m in DVD sales. While there's still a lot of life in tried and tested products, emerging technologies not only attract gadget hungry consumers, in some cases they help overcome key concerns in the industry.
For example, high-definition television (HDTV) programmes offer sharper picture quality, whilst their high level of data content -- HDTV programmes have more image detail and use more storage capacity -- make it harder to copy them and distribute them over the Internet.
"If consumers like (HDTV), it could help to ease DRM (digital rights management)," Bewkes said.
However, the Federal Communications Commission's current 31 December, 2006, deadline to limit analogue television broadcasts and promote digital television was deemed unrealistic by NBC Universal's Bob Wright.
"It's realistic if you're comfortable with chaos," Iger chided. "It's a probable disaster."
The reason has to do with the cost of the equipment needed to film shows digitally, which is expensive, according to Iger and Wright. Disney spent more than $100m to build its television operations for digital, and NBC Universal has spent more than $200m.
"We can't strand people," Wright said.
Wright also said the effect of DVRs and giving viewers the ability to skip commercials was still not certain. Bewkes called the concern overblown.
Chernin -- whose company owns satellite television company DirecTV, with more than 1 million subscribers using TiVo's DVR service -- said that it's hard to say what kind of impact DVRs would have but that the industry has to adjust quickly.
"We may not like (DVRs), but we better learn to live with and profit from them," Chernin said.
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