Shop Talk: The Cloud
By David Mumpower
May 24, 2012
BoxOfficeProphets.com
The ubiquity of cheap DVD players created the most fertile landscape in the history of the movie industry. 70% of the North American homeowners had DVD players by the end of 2004. $21.8 billion worth of revenue was attained on the home revenue market. The body of that was accrued through DVD. From 2002-2009, home video dollars surpassed monies compiled through theatrical ticket sales. There was a changing of the guard in consumer behavior whose effects are still reverberating today.
The difference as we have discussed ad nauseam over the years is freedom of choice. Until the 1980s, people could watch exactly three channels (plus PBS if your parents were boring). In the early cable television era, options were expanded somewhat but the onset of the digital era is where the cataclysmic change began. With the advent of this technology, consumers were inundated with new entertainment options. The full impact of this is only being felt now as we once again witness movie ticket sales surpassing home video sales.
The reason for this is not improved box office. To the contrary, box office ticket sales have stagnated in the 1.3 billion sales range the past two years. 2012 looks to be better; of course, this year is being propped up by The Hunger Games and The Avengers, two of the top 15 domestic releases of all time. The behavior itself is still the same. People are spending less time watching movies these days. When they do, they oftentimes spend less money. Cheap solutions such as Netflix and Redbox have yet again fundamentally altered how consumers acquire media. Studios are aware of this numbers change on their bottom line and let’s not sugarcoat their fear. They are absolutely terrified by what is transpiring.
Entertainment corporations are as reliable as clockwork when the bottom line is jeopardized. These are the instances when they reconsider their otherwise constant intransigence. Desperation equals motivation in such scenarios. Enter the cloud.
We discussed this emerging technology in our Top Film Industry Stories of 2011. We ranked it as the fifth most important event of 2011, even though clouds were not new last year. What happened is that they expanded in the same manner we witnessed with DVDs from 2000 to 2001. No, cloud movie storage has not become such a technological obelisk quite yet. What has happened, however, is that it has become viable. And that viability is something I have begun to track on a personal as well as a professional level. Over the next couple of weeks, I want to share my experiences with you in hopes that they will be helpful as you begin to consider the same choices.
Over the past year, I have taken a giant leap into the cloud. Before explaining the process, I should note a few aspects of my personality. The primary one is that I am a packrat. Try as I may to rid myself of this habit, it has proven instinctive. I am also a collector, the worst personality trait to possess in combination with packrat-itude. Finally, I am an obsessive movie lover, something you have probably deduced by now if you are a long time reader of the site. And oh yes, I married something with all three of these traits as well. When we moved in together, we unintentionally doubled down on physical media in this regard.
You do not want to look in our closets. You will never see the skeletons, because the mess is so significant. This is what we presume will save us if the cops ever try to CSI us. But I digress.
Several years ago, I purchased a Sony 400-DVD movie jukebox. And it was not big enough to store my entire catalog. So, I bought another one. Yes, we owned enough titles to fill multiple 400-DVD movie jukeboxes…and we had to make some tough choices about what to exclude. My wife mentioned removing the James Bond collection once. Only once. The basilisk stare provided in return taught her an important lesson about sharing. The Wes Anderson discs would have been ripped out right after the James Bond titles and a Cold War would have ensued for many moons. Fortuitously, we achieved détente before then.
Such is the negotiation among movie lover packrats when space is limited. Then again, these concerns were but a trifle in July of last year. As my wife and I waited to watch Harry Potter and the Deathly Hallows Part II in IMAX on its opening day, fate intervened. She had taken a vacation day and was doing some laundry, ordinarily my chore, while we waited for our 2 p.m. showing. Then, she asked the fateful question that would change our lives, “Why is the dryer orange?”
I am certain you have heard of the urban legend about the dryer catching fire. I can tell you with fierce sincerity that this is no myth. We were lucky in that my wife, a hero through and through, noticed the flames immediately. This allowed us to control the fire until the fire department arrived. We were able to save our pets and escaped with no real harm done to our persons. I did wind up maintaining the fire extinguisher a bit too long and had to be escorted out before I passed out, but that was as close as either of us came to real danger. We consider ourselves quite fortunate.
Our massive media library was less fortunate. Countless CDs, DVDs, books and videogames were rendered useless due to the smoke. For various reasons that are not important to this conversation, we were also forced to move from our dwelling. Because of this, we found ourselves living in a hotel for a month followed by spending the next month unpacking our remaining media in a new residence. Not coincidentally, we determined that our massive physical media collection had become problematic. Our path was clear.
We stepped into the cloud. The process for this is one I will describe in a future column. What is important to note right now is that a lot of the decisions you face as a consumer are impacted by your current viewing habits as well as how forward thinking you choose to be.
What we decided is that since the insurance company was paying for a lot of our selections anyway, we would ignore cost to a large extent and instead focus upon rebuilding our movie lover identity on someone else’s servers. Yes, there is inherent risk in this. I will discuss our experiences with Amazon, Vudu, Cinemanow and Blockbuster next week. What I will say right now is that we have pressed Amazon and Vudu (owned by Wal-Mart) for assurances that we are covered in the event that they decide to exit the cloud video marketplace. This is a legitimate concern as you consider options. For our part, we determined that the risk was insignificant enough that we were comfortable making the move.
The end result is that we went from having virtually no online media presence to a current library that approaches Netflix in terms of content. I am not even being hyperbolic. We currently own over 800 full seasons of television on Amazon as well as 85 movies on their service. We also have utilized the Disc to Digital program recently added to Vudu to purchase a few hundred movies at an equitable $2 each. Next week, I will discuss the services, the process and the results with regards to our user experience.