The Early Release Window Experiment Continues
The early release window, which offers Hollywood content for home consumption while it is still showing at theaters, has been debated for many years. (In fact, I wrote about an enabling FCC ruling last year.) But right now its success is being debated more than ever before. The targeted price point of a premium video-on-demand (VOD) movie – $30–is the center of the debate. The current discussion compares the success of one expensive VOD movie to cheap movie theater tickets. Cinema owners and movie directors have voiced their concerns about the shift in content consumption, with cinema owners noting that it is impossible to reliably predict consumer behavior. If it was that easy, every Hollywood title would be a blockbuster. Early release windows, however, may provide a bit of safety net. I think that it will be an interesting offer for, initially, a small percentage of consumers. While the rate of adoption is questionable, it’s obvious to me that movie theaters won’t disappear any time soon and that electronic distribution will continue to grow. The studios certainly have conducted their own research, and it is evident that they have high enough hopes to shake up the traditional models and to support premium VOD movies. From our recent press briefings and Chicago’s CableNET show, I also see that the media is interested and closely monitoring this topic. But perhaps the most relevant indicator has arisen in our recent discussions with operators. They are evaluating this opportunity very seriously and investing time and resources in the digital watermarking requirement. This may be because even a small uptake by consumers will translate into a relevant chunk of revenue.
One technically interesting point for me is that operators often prefer server-side integration of watermarking. The tradeoff is whether the integration is done in the client device, or in the video server before delivery. For example, while our client-based VideoMark watermarking solution has the advantage of distributed processing without head-end integration, our new server-side StreamMark solution does not require modifications to client devices. Fortunately we began researching and investing in watermarking years ago. During the process, what we’ve discovered is that watermarking in the compressed domain means adding a server-side integration option; even if it means re-inventing the technology and taking a new look at digital watermarking. The targeted modification of video pixels is too slow when we consider the complex coding of compression schemes like H.264. Therefore, we have focused specifically on enabling watermarking in the compressed domain by making modifications that can be expressed efficiently in the compressed bitstream and applied while the content is delivered. Efficiency is key because the delivery infrastructure is all about delivering the maximum number of parallel streams. If we have to introduce overhead to it, it is crucial that it is small and fast. As underlying watermarking algorithms and requirements have matured, the ease of integration now is critical to broad adoption of digital watermarking. The development will remain interesting because it’s an experiment on the technical front as well as for consumer behavior and I am sure there will be more progress to be reported in the future. For more information on StreamMark, you can watch the video on ScreenPlays or download our white paper, “Integrated Watermarking Creates More Durable Pay-TV Businesses.”