The future is here

By Bob Chapek -- Video Business, 3/17/2006

Chapek

MARCH 17 | Over the last several years, I have given numerous speeches about the future of our business and the implications of such rapid technological evolution pertaining to the subject of innovative content delivery.

Well, given the developments of the last several months, it seems safe to say that the future is now. That is not to say that the pieces have all fallen in place, nor that the rate of new developments will in any way slow. It is rather an acknowledgement that many of the ideas, concepts and decisions previously discussed as issues to be dealt with in the future are now upon us today.

It seems every day I am bombarded by somebody pitching a new technology.

To be honest, they are all starting to sound more or less the same … or at least based on the same basic themes. Distinguishing between which of these we should invest time and resources exploring is the real challenge.

Certainly, just because something might be technologically possible doesn’t mean it has a viable place in the world. At a minimum, it needs to meet some consumer needs, presumably better than other options in the marketplace.

It also needs to have a business model that is sustainable economically; there are certainly plenty of folks willing to give our content away to make themselves money. And of course, we need to ensure our content is adequately protected.

This, of course, pertains to packaged delivery options as well as electronic. That is why Buena Vista Home Entertainment on behalf of The Walt Disney Company is so bullish on the revolutionary technology of Blu-ray Disc. It is well positioned to be the future solution for packaged media, with its superior capacity and interactivity, copy-protection systems and market force superiority that is unrivaled. As we approach the launch of the high-definition era of our industry, I am very encouraged with how the Blu-ray Disc format will revolutionize the home entertainment world.

As the world evolves in uncertain ways, one thing is certain—that we cannot hide under a rock and pretend that the world of content delivery will not change, sometimes in ways that threaten current philosophies, dogmas and business models.

The consumer is an extraordinarily powerful group of folks; they get what they want as they vote with their dollars.

The biggest risk we run is in not meeting their needs, and then the voting is no longer done with dollars but for free, as illegal distribution theoretically then becomes the only way for them to get what they want. Competing against “free” is hard, but it’s incumbent upon us as an industry to provide the value necessary for the consumer to justify the expenditure. But it’s not impossible—just look at the $25 billion worldwide bottled water business.

Bob Chapek is president of Buena Vista Home Entertainment.

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