Wednesday, August 12, 2009

Technology v/s Content in the game of money

Lots of exciting developments on the technology front are making content-owners running for cover to courts. While the content-owner (i.e. Studio) spends $$$ making movies, music, etc - technology allows rapid distribution at rock-bottom prices or even free (i.e. piracy). Now, what is interesting for me is that I am equally passionate about both technology and content! I would'nt want to see anyone lose and although this is a long-standing (and life-long) battle, it is always interesting to see which side wins in a court ruling. Redbox has been the victim of studios targeting it for rock-bottom rentals - where Redbox has conveniently sourced the discs from the wholesalers/retailers instead of from the studios. A simple business model. Loss of $$$ for Studios = Gain of $$$ for Redbox. In turn, Redbox uses the internet and floor-space within wholesalers to rent their discs, in effect reducing their operating costs drastically. (The only big expense they should have is paying their people for the supply-chain algorithm!) Studios have now restricted wholesalers from selling their discs to Redbox (!!) and Redbox in turn has sued the studios!
I am compelled to sit on the fence when such debates arise. As much as I love technology (which is the way the world is going), I am equally passionate about the value of content. I am watching these battles with bated breath. Whatever the ruling, there will be further excitement as each of the sides try to win in the game of business.
Where is the audience/consumer in all of this? Well, the audience wants the cheapest price for the product, so my guess is technology will eventually win, and studios will have to think 1o times before spending $$$ on movies that will not make them any substantial returns. I am happy to the extent that since "Stories" are the most important part of the movie, and as long as the story is told with passion, the studios will have to cut costs on other items - actors' salaries, special effects, etc. Exciting industry this!!