Media Servers, Streaming - where are we going

This year I walked the floor for the 1st two days with Jessica, my wife.  Media servers that were announced last year are finally shipping, Kaleidescapes lawsuit is almost finished, Vudu is launched, Escient shipped their box, and boy is the world confusing. I think there is a pathway out.  Here is our position and some strategies for media purchase and organization in the near-term.

Amblesides Positon on Digital Content Acquisition and Management

• Buy content on Disc whenever possible. Rent, don't buy (unless cheap), on-demand video content.  
  
• Kaleidescape remains the best DVD playback device, Tivo the best broadcast playback.  Best of breed is primary strategy for clients with 100% legal content strategies.
  
• For clients willing to violate Digital Millenium Copyright act (or use sw from companies that do), aggregating all content but broadcast onto a real storage server (either a PC or extender like XBOX 360 or AppleTV) allows for a lot of convenience. For a major library, the storage costs are non-trivial and disc changes might still be cost effective.
  
• For many uses, DVD storage added to the existing picture + music functionality of existing servers might make them viable and more interesting.
  

Personal Music, Video + Picture Sharing is getting mature - use your PC

AppleTV, Microsoft Media Center do this well, Tivo and DirecTV DVR's do this also but badly.  AppleTV does not play well with external storage while the other platforms do.  This shouldn't guide whether you become a PC or Apple household but somewhere there should be a large, backed-up, disk to hold your stuff.

Personal DVD copies on your PC are imminent

RealDVD and Drive-in both are riding the legal precedent set by Kaleidescape to rip full,encrypted copies of movies to a hard drive allowing for a DVD playback experience on the PC.  This is probably no more than 15% the value of a Kaleidescape system but for playback of kids discs in a convenient manner, it will be a boon to many.

Easy, high-quality on-demand movies are not imminent

There is extremely little on-demand HD content.  Netflix has positioned that they will have HD but none yet.  Amazon On Demand has zero.  Vudu has 200 movies, AppleTV the same.  The best source of casual HD content is a big DVR with lots of HD content.

 Movies + TV content are not following the same model as music

Online services for content rental - iTunes, Vudu, etc - or free services like Hulu - should be supported but not central to a video media strategy.  The devices, DRM strategies and quality will continue to be in flux for quite a while. This is very different from iTunes music purchases, music leasing via Rhapsody, etc - they are relatively mature and can be the center of a music strategy. Management and consumption of Disc + Online content needs to be managed by an aggregation platform - most likely PC based because of Apple's role as a content distributor and hw. Apple can be used with 3rd party tools that are have questionable legality but have a great user experience if that doesn't bother you.

Broadcast + Standard Discs are still primary

Amazon has 180K titles in standard def, Netflix over 100K. Between the broadcast and premium networks, one has a solid 4000 HD titles a week to choose from.  There are 1600 blu-ray discs total and maybe 300 HD downloadable titles across all services.  Because of the higher price of blu-ray discs vs. DVD's, especially catalog titles, the 20-1 current sales ratio probably reflects at least a 35-1 title sell-through ratio - lots and lots of $5.99 and $9.99 DVD's are bought.

Discs will remain primary for purchase

Amazon's update is focused on rental - purchase might go away.  iTunes offers no HD purchase at all for movies.  The HD sale market is extremely limited. While the library size of Movielink, Vudu and Amazon Unbox are fairly large, focus is on quick access.  Focusing on rental or instant viewing bypasses the channel conflict, storage and many other issues.  I think it must be much easier to deal with piracy when online viewing is the only possibility.

But the future is streaming

Streaming is the future.There is some general acknowledgement that streaming, not Blu-ray, is the video consumption end-game. Whether its streaming for live viewing or local storage and playback, streaming serves almost everyones purposes (maybe not the consumer but they are sort of the bottom of the barrel here.)  

The movie and TV production culture for many, many years has been one of leasing and periodic viewing.  One movie ticket, one season of re-runs, 16 weeks of HBO viewing, one pay-per-view.  VHS tapes and DVD's became a very important revenue source but one that often was selling through to the rental market. DVD sales are extremely important but they are shrinking while all other forms of consumption are growing.  Single viewing over the internet holds the promise of watermarking or dynamic encryption - something the industry needs to avoid the same fate as music industry.  Also, the TV industry has the history of ad supported content.  And it seems like it might be working in the video world - Hulu and YouTube don't seem to have any potential of going away while Pandora (a streaming music service) is pretty iffy.

Just don't buy streaming content right now - rent it

Purchase of low-cost content - iTunes TV Shows - seems very low risk.  It's really akin to the cost of rental and should be regarded as a short term purchase not long term.  Vudu, Amazon Unbox and others do not offer physical back-up of media to non-DRM media.  I advise clients to look at "purchased" content from Amazon or Vudu as a long-term rental.  $600 worth of movies will likely be gone if the company goes away and the hard drive crashes.  There is no way to back-up or restore.  Apple offers this with iTunes music and that feature - in addition to the ubiquity of the platform - makes it the only low-risk online content to purchase.  Vudu, Amazon Unbox, iTunes Videos, CinemaNow, MovieLink and all the rest offer no way to back-up your media to a standard (DVD/Blu-ray) for that can be played without their software.   No one has placed their software in escrow or demonstrated clearly how the content will not be orphaned.  All of the media comes with a restricted use license on top of the digit-millenium-act protected DRM.  

A Platform must have multiple uses, hold content, access + search content and allow for playback.

Tivo, Windows/Xbox and AppleTV/iTunes.  All three can store music, playback purchased music, rent movies, and playback stored movies.  And all three seem to have a footprint that allows survival.

A Personal/Family policy of ethics is necessary to properly decide on a strategy

Some of my customers own cars that go over 65 mph and I'm pretty sure they actually use that feature.  Somehow Porsche and Ferrari don't seem too worried about selling a tool that blatently breaks the law.  OTOH, most common sense understanding of fair-use has been contravened by the Digital Millenium Copyright Act.   Some families presume violation is fine, others want to respect the DMCA.  Since everyone wants, if it's easy and free, upiquotous access to content, this position must be clear - it is the largest constraint to a personal media strategy. I see households that seem to hold sw piracy and content piracy as lesser evils to breaking encryption on content they own.  As far as I know there have been far more prosecutions for content piracy than DMCA violations.  I'm not sure an end-user has ever been prosecuted for removing DRM from content while plenty have been prosecuted for content piracy.