HDTV, DVD, Hard Drives and the future

I love looking for ways to screw up conventional wisdom. Right now in the entertainment world, the conventional
wisdom is that both sides on the HD DVD vs Blue Ray DVD will battle it out and a standard for HD on DVD will
emerge. No one is trying to rush to a compromise because the big media companies want to squeeze as much money
as they possibly can out the current DVD business cycle.

Good. The longer it takes, the less chance any format of DVD has ofhaving a place in the future of home
entertainment. Don’t look now, but the price and size of hard drives have fallen like a rock, while capacities
have soared, with no slowdown in site.

Which leads to the question What is the best way to distribute content? DVDs which will be limited in capacity
to 9.4gbs on a single DVD for another year, and then after that 50gbs on a single disk for years to come after that,
or rewritable media that can hold 2gb already in a device half the size of a pen, or in a hard drive that can hold
200GBs plus in a drive the size of your cell phone?

Which device should content distributors like HDNet invest in ? DVD, knowing that the futurestandards will
be lockedfor 7 to 10 years, or these storage devices that will grow in capacity, and shrink in size and price,
not to mention the additional flexibility of being able to erase and rewrite the drives?

It’s not a question being asked in many places, but it is something we are talking about at HDNet. The
choices we and others in the industry make can have a big impact on the future of your home entertainment.

Personally, I like putting content on rewritable drives. Let me tell you about how I personally made the USB Flash
Drives work for me.

I had a couple DVDs that I hadPURCHASED, that I hadn’t had the chance to watch. I had a couple 512mb Flash
Drives that I had bought specifically to test them out for video. I took the first movie, and using an encoder
with compression (not going to tell you which one, don’t want to play favorites), I encoded the movies at DVD quality
and saved the output onto each of the 512mb Flash Drives. I popped those tiny little puppies into my pockets and off
I went to the plane. Keys, some money and my keychain flash drives in one pocket, phone in the other. No hassle, no
fuss no muss.

On the plane, I popped the first keychain drive into the USB Port. Got the ready signal, got prompted to open my
video player, and watched a nice movie right from the keychain drive. On the way home, did the same thing with the
other movie. I loved it. Far less space than DVDs. Could put them in my pocket instead of filling up my
briefcase. I immediately went out and bought a 1gb keychain drive so I could hold 2 movies on 1 drive, in addition to
my first 2 drives.

After having such a great experience with putting my DVDs on the keychain drives, I decided to test HDNet content
in HD. The keychain drives, even the 1gb didn’t have enough capacity to hold a full movie, so I tried just some of
our promos. They were short enough that they would fit in 512mb, but long enough to let me see if it worked.

I used a standard HDTV MPeg2 transport stream. The keychain drive wasn’t fast enough to allow me to pull the video
directly. I had to copy it to my hard drive on my laptop, where it played with no prob, as it should.

SinceI was getting fired up about the possibility of putting HDNet content in a format that could be
transportable and work easily with MediaCenter PCs, and in the not to distant future, USB or FireWire enabled TVs,
PVRs and Setop boxes and even DVDs (yes,tvs withhard drives are right around the corner, and
yes,all yourCE devices with a future, will have storage and expansion ability),I decided to buy a
portable 20gbs USB 2.0 drive that was about half the size of a pack of cigarettes. Cost me 150 bucks. I also bought
an external 80gbs FireWire Drive for under 100 dollars. I loaded a full 2 hour movie on the cig sized
drive, and all the episodes I had of our HDNet Word Report.

Connected to my laptop, the cig drive couldn’t quite keep up. It had a couplehiccups, but it was close. If I
had used any compression at all on it, no doubt it would have kept up no prob. After copying to my laptop hard drive,
it played no problem at all.

I connected the 80gb firewire drive to my HP Media Center PC and to my PC, it was fast enough to play without any
problems. I loved it.

I loved it, for a ton of reasons. Let me name a few.

I know that the price per GBs of an external hard drive is now down under 50c. That price is going to fall
further.A lot further as capacities increase. This time next year we should be talking about 1TB (that’s
1,000GBS) drives at 25c per GB or less. The increased capacity means not only that I can stick more HDNet movies or
TV shows on a drive and sell them to consumers, but it also means that I can increase the quality of the picture
substantially.

What few people realize is that when we shoot something in HD for HDNet, the quality we capture the
contentat is far, far better than the picture quality that you see on your HDTV. We have to compress it
to fit in the bandwidth defined by broadcast standards. That compression reduces the quality of the picture you see.
Your TV can handle the quality we capture it at, but we don’t have a way to get it to yourTV at that quality
level yet.

Bigger cheaper hard drives gives HDNet the ability to use that additional storage to hold our contentin
uncompressed qualityand increase the picture quality that you can see on your TV. A bunch. We can take
advantage of new cameras to capture at better and better qualities, and of new compression schemes that approach
future camera capabilities, only because we have ever expanding storage. That’s something DVDs will never have. So by
delivering content on Hard Drives rather than DVDs, we will be able to continue to increase the picture quality for
years to come.

The other cool part is that the video playback devices that will be in your home over the next couple years will
have the ability to connect via USB or Firewire to these drives. PVRs, Set top Boxes, Media Center PCs,even DVDs
designed to play today’s DVDs and whatever future DVD standard is settled on, all will have the ability to connect to
Hard Drives in some shape or fashion, or people wont buy them. There is going to be a big, big war to host your
content in your house. Whoever does it the best, provides the most flexibility, and expandability at the best price,
will win.

Next on my reasons to love this approach to distribution is that it basically kills off the “Piracy is going to
kill us” threats from the big movie companies. Hard Drive storage is expanding far more quickly than upload or
download speeds to our homes. The ability to use that hard drive storage to increase the quality and file size of a
movie, makes it practically impossible to distribute it over the net. I have a question I always ask at speeches, and
have asked for the last several years. I ask if anyone in the room has ever downloaded or uploaded a movie or TV show
in HD quality to or from a P2P network. No one has ever raised their hand. That is in spite of the fact that HDTV has
been in the clear, over the air since 1998. EVERY SINGLE SHOW that has ever been broadcast over the air, and
continues to bebroadcast today,could be picked up and copied by any of quite a few different, now
under 200 dollar HD encode/decode cards and then put on the net. It hasn’t and won’t happen, because shipping around
18gbs per 2 hour movie isn’t going to be fast anytime soon. Make the file sizes bigger to accommodate better quality,
and forgettaboutit.

When we get to TB hard drives for under 250 dollars, we will be able to fit 50 movies in HD quality on that drive.
More than ONE THOUSAND movies in DVD quality on that drive. The keychain drives will be able to hold an entire HD
movie and cost under 20 dollars. That same keychain drive I talked about earlier, in the next 2 years or so, will be
able to store a DVD and cost under 10 dollars. So which is the better way to deliver a movie or movies? On a DVD with
a boring, lifeless future, or hard drives?

Once the prices of a keychain drive get to a couple bucks for storage enough for a DVD quality movie, then it will
be easy to distribute and sell to consumers.(Of course they will still be packaged in pain the ass plastic that
no normal person can open right when they buy it, but that’s another issue.) The question will be who other than
HDNet will be selling it that way. Will companies stick to DVDs because that’s the way they feel comfortable, or will
they support a new medium?

That’s a little question. The bigger question, the Billion Dollar question is how to deliver content on or
to hard drives, regardless of size and capacity, in a way that consumers will enjoy it, and do it cost effectively
today?

Realize, that whatever happens in the next couple years, that you won’t be able to buy the newest releases and the
biggest hits thisway. There is no major media company who is going to disrupt their DVD cash cow
totakea chance on a new business like this.The “if it ain’t broke, don’t fix it” mentally is
big. But again, that’s a good thing for entrepreneurs with content. While they hope it won’t break, we can be
out there trying to break it, and then they usually can’t fix it.

So without the biggest hit movies, what is the best way to deliver content to homes and for travelers?

We are looking at kiosks. Walk up to an airport kiosk, or a kiosk at a retail location. Pick the movies or shows
or music they have available, pay for it via credit card, and wait a couple minutes while the content is copies from
a server right there on the premises.

We are looking atcustomizing it per user. Go online, pick the content you want. Pay for it, the next day
your hard drive with all the movies, shows, music, whatever, shows up on yourdoorstep. You plug it in
yourMediaCenter PC, your DVD, PVR, whatever, and watch, listen and play.

There is also the Netflix rental approach thatcould work as well. Pay 100 bucks for the
first200gbsexternal drive. Pay us 20 bucks a month, and we send you a new drive with the new goodies, and
you send us back the one you just watched Easy and breezy. Well, that is if consumers like working that way.

Probably the best short term solution is to work with high end home theater installers. The best belong to CEDIA
(www.cedia.org). They are the folks that are most capable of integrating Media
Center PCs, Hard Drive based storage systems , HDTVs and all the media devices in your house. I can only guess that
they would have a field day selling hard drives full of HD quality or better movies to their high end customers who
want to truly enjoy their home theater systems.

There are a lot of openended questions and challenges in this, but that’s what makes business fun.
What kind of devicewill be the content serverin the home? Who will sell it? How will content be
delivered, and by who? What will the pricing be? What will the business model be?

A ton of questions. The good news is that none of the solutions involve goodole’ fashion DVDs, other than as
an interim solution. That means there is one hell of an opportunity out there for HDNet and others as long as
we can execute.

I also wanted to add just a couple of comments, questions, remarks.

1. Why haven’t the Media Center PC companies and the cable and satellite industry gotten together to put set top
box capability in mediacenter PCs? People who buy media center PCs, might want to use them as media centers, and
given that cable and satellite deliver the media, doesn’t it make sense to combine the two? It would cut
customer costs for all involved significantly.

2. Why aren’t Media Center PCs promoting the fact that they can play HD files and shipping with Demo and samples
to show them off? All of them can. I just bought a new HP Media Center PC, and it didn’t come with squat to show off
what it can do. It works great, but I had to figure out all of its capabilities. A showcase would make it a far
better solution.

3. The biggest decision facing HD cable and satellite distributors today is quality vs quantity. Right
now most are looking at using compression to squeeze more channels into the existing space they have rather than
squeeze a better picture into the same bandwidth that channels take today. The reason it’s a huge decision is
that once they decide to fit in more channels, they can’t go back. You can’t all the sudden decide you need
15mbs per channel to deliver a picture that compares to a competitor’s better pictureafter compressing down to
6or 8mbs per channel.

4. In a world ofmultiple Terrabyedrives, is VOD a good business? One of the things I learnedat
broadcast.com is that whenyou give thousands of choices on demand, people go to the little things that they
couldn’t find anywhere else. Thesailing fan will choose the show about sailing over the
blockbustermovie because they can’t get the sailing show anywhere else. Or maybe theychoose both. The
problem is that when people all choose different things at the same time, its a huge bandwidth hog. Thousands of
choices, thousands of people using different movies, particularly when the expectation is for HD quality, and there
is a huge problem. The cost of delivery per movie if the system is used a lot is incredible. UnicastingDVD or
higher quality videois an incredibly inefficient business. (Unicasting is where there is one connection per
user to the movie being shown. Each user has to have his own bandwidth, they cant’ share streams) It’s why movie
delivery over the net will never be a big business.

I know bandwidth on your own network is cheaper than the net, but when hard disk storage costs 25c per GB, and
falls fast from there, unicast won’t be the best way to go.

The real solution for VOD is TIVO/PVR from the main office. PVR customers are becoming trained that when you
fill up the hard drive, you have to delete something to get something. Put some PVR software on the front end, and
allow users to pick from a menu of content that they can add. Then overnight, they are multicast the content ,
whether its via cable or satellite, it’s saved to the hard drive. If they watch it, they get billed for itand
everyone is happy, and distributors maximize their revenue per bit.

Ok, I’m HD worn out for now. Thanks for letting me core dump some of the things that have been on my mind re HD
and the future.

162 thoughts on “HDTV, DVD, Hard Drives and the future

  1. A name is called “Price and Spec.” It aims at conveying price information of a broad digital
    electronic product, and specification including the DVD recorder of a former sharp company.
    Please give me access in detail at the following.
    Sharp, world’s first HDD&DVD-R / RW drive loading Blu-Ray recorder

    Comment by tezz -

  2. Believe me, the concept of having movies or music released on SD/compact flash format was a vision I had back a few years back when I paid 80 bucks for a 64MB card and was thrilled at this idea from a size standpoint. DVD cases simply are starting to eat up shelf space. Currently, the SD card now sits at 2+ GIG and the compact flash at 8GIG, but with the inception of high-definition and the storage amounts it would take, I just don’t see it happening. I’d say we’ll be moving onto an uncompressed definition before long and these cards are just not keeping pace. They’re just now getting to dual layer DVD size which is already been overshadowed by blu-ray.

    And blu-ray has already been waaaaay overshadowed by this: http://www.physorg.com/preview785.html

    1 terabyte discs, guys? This guy has been in development for awhile, I remember reading about the “Collosal” company a few years ago.(calling the format FMD-ROM at the time)
    He’s got ->100<- terabytes on a 3.5 inch disc - RIGHT NOW!

    Comment by Randy -

  3. Say you see the movie at a Landmark theater, and you really liked it. The ticket should be printed with an barcode for an instant rebate if you bought both the DVD and soundtrack right then and there after the movie. It could be a mail-in rebate (for less discount) if you bought either one later from any big box consumer electronics store or online. That means you could go home with the DVD (or SD card) and the soundtrack (on CD or SD card) for a reasonable total price.

    Comment by &#20256;&#22855;&#31169;&#26381; -

  4. I´ve used ghost and believe the application is great. give it a try!

    heidi

    Comment by Heidi -

  5. A. This is irrefutable logic and reasoning expressed well. Few related key issues/trends:
    B. Why should we assume that the technology affecting the speed off downloading and uploading will not keep pace with other new technology.
    c. What role wouLD WI-FI Play in future and how this would influence bandwidth and speed.
    D. Customers accustmed to hugh bandwidth internet in places like Korea and Japan may feel,”although storage capacity-to-cost ratios are improving more quickly than broadband bandwith-to-cost ratios, there is no reason to believe these file sizes will be prohibitive-a typical HD movie that is 2 hours in length would be 18 gigabytes. Given the availability of broadband connections in the US that support either 1.5 megabits/s or 3.0 megabits/s download speeds, you are looking at:
    ~17.5 hours to download at 3.0 megabits/second (~300 kilobytes/second), ~35.0 hours to download at 1.5 megabits/second (~150 kilobypes/second).
    E.Kiosks,like the ATM networks vending digital music downloads could be distinct possibility
    F.Piracy concerns and legal regulations.
    eWeek just published an interview http://www.eweek.com/article2/0%2C1759%2C1650493%2C00.asp with David Proctor, hardware lead for the Microsoft Portable Media Center who predicts that in two years the “Portable Media Players will come equipped with 125GB of data storage by 2007 for recording and storing Hi-Def video, and that PMP devices will come with wireless connectivity to “stream content on the fly from a local source, connected to a user’s home server or content provider via the Internet.” Proctor seems to be a little inconsistent himself when he explains that the Wi-Fi feature will most likely obliviate the need for a large local hard drive.

    Overall, any development here hinges on advances to be made in multiple streams – very interesting to watch how this evolves – but I think Mark cuban may prove to be rigt at the end.

    Comment by S.Sadagopan -

  6. Download speeds? Not sure that matters when your using hard drives or portable USB. Although not as wide spread as the Internet the simple job of coping one drive to another (very quick with a utility like Ghost) would make piracy fairly straight forward. It would be local again much like swapping VHS tapes but it could still be done. Then again maybe the TV/Movie industry isn’t worried about local content exchange and only cares about broadband distribution. Either way I agree that DVD’s are a dead technology.. I find CE too restrictive in general. That’s why I use a HTPC at home (Media Centre PC).

    Comment by Greg Martin -

  7. How this discussion can occur without reviewing Jim Gray’s very extensive breakdown of the economics of storage is beyond me…

    Go read it
    http://www.acmqueue.org/modules.php?name=Content&pa=showpage&pid=43

    given the huge amounts of data that he already needs to ship around (Gray is already beyond the needs of HD video), it’s going to be a terabyte drives and associated computer that get shipped around…

    Comment by Koranteng -

  8. STARZ movies are FREE on REAL.STARZ.com/browser.html., or rather unlimited for the $8/$20 for REAL total features. Blockbuster/Netflix out of business!, except for need rentals.
    I (we) need faster access for WiFi without taxes, at truckstops and all businesses, without blocks, commercials/coupons would be a great way better than popups.
    Ethernet/Firewire/Cableport conns at every seat in restaurants would speed up the process, enabling HDTV immediate access to create the NEED for every driver. CREATE the NEED should be the MANTRA –
    I need a SIDEKICK II, 2? yes, next with a TREO.

    Comment by Greg daBull -

  9. The thing is, ppv has been around, what, 20 years?

    There are currently two distribution models in home entertainment/media. The “rental” model and the “sale” model.

    The “rental” model includes any one-time or limited time viewing – Movie theaters, television broadcasts, pay per view, DVD rentals. The consumer pays a price and gets to experience the media once (not withstanding home taping) or on a time limited basis (dvd rentals). With commercial tv, that payment is in the form of time spent watching commercial.

    The “sale” model involves the permanent purchase of media which may be experienced an unlimited number of times – DVD sales, CD sales.

    Generally speaking, consumers are willing to pay considerably more for the “sale” model due to the perceived extra value of being able to reuse over and over again. Buying the movie on DVD might be $15, watching it in a theater* $10, PPV $5, rental $3.

    *The theater includes a lot of value added so the price is higher than you’d expect from a rental in that all the equipment is provided (in order to play a dvd you must own a tv and a player), there is a monopoly situation on new releases which don’t appear in other formats (dvd, ppv) for several months, plus the whole element of spectacle.

    In order for VOD or any other non-permanent distribution (ie: kiosk loading of harddrives where movies need to be deleted once the hard drive is full) to succeed the pricing will need to be around the “rental” price point (barring some added incentive like exclusivity). However, the price of manufacturing a “sale” item is not really all that much more than distirbuting a “virtual rental” copy.

    For example, for a big commercial DVD run, the cost per DVD (including packaging) can’t possibly exceed $1 per. What would the cost be to distribute a movie VOD or through some kiosk (including ammortised cable infrastructure cost, electricity)? Let’s say, even for the sake of argument, “almost free”.

    The VOD (keychain, hard drive, etc) version is going to be have to be priced $5.00 or less. $5.00 – $0 cost = $5.00 profit. For a DVD however which sells at $15.00 it’s $15.00 – $1.00 = $14.00.

    So the DVD is almost three times as profitable per unit over the VOD (etc) version. Now granted that $14.00 gets split all the way up and down the supply chain. However, VOD is going to have distribution costs as well.

    This means that the DVD manufacturer has more money to plow into advertising, customer service, R&D, whatever it takes to build the audience. Whereas the “virtual rental” is going to be fighting an uphill battle against an already entrenched market – Compare current PPV sales to DVD sales. Which isn’t to say that can’t change, however what probably needs to happen is for the storage medium (keychain, harddrive, etc) to get cheap enough that you can have your cake and eat it too. So, the storage medium costs $10, the movie costs $5, combined it’s the same as a DVD. Except you can always erase the storage medium and load another movie on there. Or, you can keep buying new “keychains” and keep any movie you really like around permanently.

    Or PVR’s with infinitely expandable and upgradeable storage capacity. Now, if someone would make a PVR that Mark could plug one of those keychain flash drives into….

    In other words, really pretty much the same situation as now, except with the added flexibility of being able to re-use the media and save the media cost if you don’t want to keep something permanently.

    Comment by Christopher -

  10. DVDs will stay sexy as Digital Rights Management mucks up copyright and ownership issues in regard to personal media. For what it’s worth, I’ve recently stopped buying MP3s at iTunes and such and gone back to CDs. I own it and can put it on any device I like. Same may be true for DVDs.

    kk+

    Comment by Kris Krug -

  11. Mark,

    I’ve DL’d HD content a couple of times when i’ve missed a show, and the quality is fabulous. However, it is a major pain in the ass as you state.

    I love the idea of keychain drives. Pissed I handt thoughtof it truthfully.

    PS. Hey, can I be on befefactor II? I rock at Jenga man….

    Comment by Mark Yturralde -

  12. I’ve always agreed with you about how silly file sharing with HD is, the future of HD-DVD, and I agree with you that the hard drive will be the best way to do it.

    I’ve recently bought a Hi Def. Tivo unit and love it, but I’m the kind of guy who doesn’t like to wait and likes to watch recorded broadcasts so as not to watch commercials.

    Anyway, before the Hi Def. Tivo, I bought a computer with a My HD card. I hooked it up to a 50″ Samsung DLP, and it was heaven. The card was supposed to hook up to titantv for tivo like features, but I could never get it to work. I had to manually select the programs I wanted to watch.

    I guess the thing about HD-DVD that makes no sense to me is that we already have D-VHS, which already has greater capacity than the DVDs you mentioned. I bought a unit from a company in California which allowed me to record programs from directv (inlcuding yours) to a D-VHS tape. My first recording was from HDNet, Speed Racer. I bought the JVC 3000, and while it works great, it too didn’t have a timer.

    Nontheless, the only advantage for DVDs over hard drives or tapes would be cost.

    Comment by docjoe999 -

  13. High Definition Will Have to Wait
    “Yes, HDTV is the wave of the future and I’m positive the SCI FI Channel will eventually convert, but, unless you somehow haven’t noticed (which I doubt, since you own one), HDTVs are still very expensive, and many people don’t have the resources to buy them. When given the choice between $350 for a 27-inch flat-screen TV and up to $5,999 for an HDTV (some are even higher in price), most people will go for the $350 flat screen.”

    Low-Quality TV Doesn’t Deserve HD
    “I have long thought that the SCI FI Channel should make every effort to join the HDTV world (“SCI FI Should Broadcast in HD”); but then I reconsidered, thinking over exactly what they offer to the viewing public most of the time.

    Theodore Sturgeon coined a famous maxim which goes: 90 percent of everything is crap. Sadly, that is more than true for the SCI FI Channel. For every Stargate SG-1, Stargate Atlantis, Farscape and Invisible Man, we get get entire warehouses of straight-to-video (or is it straight to DVD by now?) crap.

    If they don’t care about the low-quality of the majority of their programming, why would they care about their signal quality?”

    HDTV Is Tech Snobbery
    “Lots of us in the sci-fi demographic are very much into high-tech, but that does not necessarily mean that we value television so much that we’ll sink four-digit amounts to watch HDTV.”

    http://www.scifi.com/sfw/current/letters.html

    Comment by Dimitar Vesselinov -

  14. I could not help but at the very least commend you for having perhaps the most intelligent conversation about HD that I have ever seen. I have developed, for want of something better to do, a broadband network , here in central Texas. However, I am an animator and frankly believe , given my background in delivery that the whole idea of providing HD movies via the internet is beyond my life expectansy. I am now 55 but have so many experiences along the oh so many years that the very idea , with my broadband knowledge , thatthe idea that we could within 10 years even deliver several 10’s of Gigabytes of data via a connection to the net is just frankly impossible. with current exponential development of compression maybe,, just maybe we could be at some kind of magnitude of compression of HD movie to single gigs of data , we still would never be able to offer even standard DVD format over the net unless you wanna wait for multiple hours or even days for the file to arrive. I totally agree and will post more serious experience as to why its gonna go the data ‘Lump’ way
    Forget the plastic disc, which frankly is really based in the CD market background and the music idiom. lets all of us embrace what we can see right now with our own eyes. The fact that the ordinary folks can go buy a 720 or 1080 movie and run it from their puters into an HDTV screen and its awesome. Can a DVD do that now? No!. could it do it next year ? doutfull !, could it do it 2 years from now, still doubtfull !. So,,,, if a cheap ass PC can play a 1080 movie on an HDTV screen right now where will we all go ?
    I leave the question open but as an animator, I am sure its obvious

    Comment by Paul Buckland -

  15. It’s been a few weeks since I’ve been to the blog…boy have I been missing out.

    Pertaining to your comments on harddrives, et al…

    1. I agree that the current media cycle will be slow to change based on the potential revenues through the current business cycle.
    2. The experience you describe sounds incredible. I am anxiously looking forward to my opportunity to use these products so that I can make my own decisions about performance. You have motivated me to take an offensive consumer stance with this form of media.
    3. Correct me if I’m wrong, but I believe until TV’s are manufactured with this interface as a standard rather than catering to some after market, it is impossible to forcast their popularity.
    4. I do agree that utilizing smaller components with huge drive space at a substantially reduced cost is the way to go. Especially after your “testimonial”. However, you must concede that in most family homes, people are not watching their DVD’s on computers. That type of interaction is prevalent on planes and in air port terminals and even for the few lazy individuals in workplaces. Even with a 17″ monitor, I want my TV for entertainment value.
    5. What is the perceived tool for entertainment value? Traditionally, excluding video games, the PC has not been a source of entertainment. Barring the connective emails and laughs one might get on various message boards, the intention of the PC, or even the home PC was probably not focused on entertainment but connectivity.
    6. How does that change? Is it consumer driven or manufacturer driven?
    7. Anything that cuts consumer costs will most likely be a success.
    8. All programs and operating systems should come with an integrated “tutorial”. What is the point of owning/operating something that one barely understands. The youth of today will blow us all away. My child just started Kindergarten. When this school year is over, she will have a comprehensive understanding of the CPU, the keyboard and the mouse. I recall taking typing as an elective in high school. While my child already, at 5, manipulates my computer with some proficiency, she will seemingly be a master by the end of Kindergarten.
    9. Mark, it is no secret that you know your stuff. I enjoy your comments and look forward to reading more in the future.

    Kindest regards,

    Suzi

    Comment by Suzi -

  16. It’s been a few weeks since I’ve been to the blog…boy have I been missing out.

    Pertaining to your comments on harddrives, et al…

    1. I agree that the current media cycle will be slow to change based on the potential revenues through the current business cycle.
    2. The experience you describe sounds incredible. I am anxiously looking forward to my opportunity to use these products so that I can make my own decisions about performance. You have motivated me to take an offensive consumer stance with this form of media.
    3. Correct me if I’m wrong, but I believe until TV’s are manufactured with this interface as a standard rather than catering to some after market, it is impossible to forcast their popularity.
    4. I do agree that utilizing smaller components with huge drive space at a substantially reduced cost is the way to go. Especially after your “testimonial”. However, you must concede that in most family homes, people are not watching their DVD’s on computers. That type of interaction is prevalent on planes and in air port terminals and even for the few lazy individuals in workplaces. Even with a 17″ monitor, I want my TV for entertainment value.
    5. What is the perceived tool for entertainment value? Traditionally, excluding video games, the PC has not been a source of entertainment. Barring the connective emails and laughs one might get on various message boards, the intention of the PC, or even the home PC was probably not focused on entertainment but connectivity.
    6. How does that change? Is it consumer driven or manufacturer driven?
    7. Anything that cuts consumer costs will most likely be a success.
    8. All programs and operating systems should come with an integrated “tutorial”. What is the point of owning/operating something that one barely understands. The youth of today will blow us all away. My child just started Kindergarten. When this school year is over, she will have a comprehensive understanding of the CPU, the keyboard and the mouse. I recall taking typing as an elective in high school. While my child already, at 5, manipulates my computer with some proficiency, she will seemingly be a master by the end of Kindergarten.
    9. Mark, it is no secret that you know your stuff. I enjoy your comments and look forward to reading more in the future.

    Kindest regards,

    Suzi

    Comment by Suzi -

  17. If you are watching movies on flash, check out http://www.zvue.com, the Zvue player which plays MPEG 4 off SD. Only $149. I think that removable flash media will be the new DVD. Which format, though?

    Comment by Phillip Remaker -

  18. This is an article on fool.com
    If you haven’t already seen or heard about it. Its saying that there is the possibility of bring Netflix movies to the hard drive of the Tivo.

    http://www.fool.com/news/take/2004/take040907.htm#TiVo

    Comment by Bryan -

  19. Your sentiments seems to generally follow those of another media visionary, Steve Jobs. I wouldn’t be suprised if you’ve hit the nail right on the head.

    Comment by JR Rivers -

  20. Look into the future a few years and replace the word “HD” with “3D” and you’ll see that none of the technical questions are as important as how people consume the content. Bandwith/Storage issues are transient considering the fact that no single consumer will never have enough of either, so they’ll make due with cost/quality issues. People will still go out to a movie theater for the shared experience of sitting in the dark with strangers to see something new for the first time. Those with more time than money (i.e. college students) will always download terrible quality movies over many hours if the perception is that it will save them a few beers worth of spending cash. “Real” people soon realize that their time is worth more than learning how to do download and view movies and it’s just easier to buy it on DVD at Wal-Mart or on Pay-Per-View. That’s how you really combat piracy in America – through inconvenience, not the threat of lawsuits. How many people do you know who are “stealing” Satellite, after being zapped a few times?

    Music and movies are consumed very differently. You don’t need to concentrate on music in the background, but you do have to look a movie screen. This is why even if Apple made a video iPod they wouldn’t be nearly as popular as the music only version. The only way it would work is if you could use it to transport from one screen (your desktop computer) to another – (your girlfriends living room). I think that any screen less than 25 inches wide and handheld won’t really work as a consumer device – no matter how many movies it can hold in storage. I can’t see video specific handheld devices, PDA’s or cell phones competing for consumer dollars against cheap standard definition CRT TV’s and sub $100 DVD players. Plus, you need the time and place to watch it – say on a lazy Saturday on your couch versus being jostled around on a subway to and from work.

    Keyfobs and Kiosks sound great, but they need to be located in accessible places – airports are an obvious choice – but what about malls, grocery stores or even Movie Theater Lobbies? The last one is the most interesting considering some of Mr. Cuban’s recent investments. I know that this is where they are going, but I’d like to point out that the very best DVD “extra” you could offer would be the full movie soundtrack on MP3’s – that’s worth a the premium price.

    Say you see the movie at a Landmark theater, and you really liked it. The ticket should be printed with an barcode for an instant rebate if you bought both the DVD and soundtrack right then and there after the movie. It could be a mail-in rebate (for less discount) if you bought either one later from any big box consumer electronics store or online. That means you could go home with the DVD (or SD card) and the soundtrack (on CD or SD card) for a reasonable total price.

    At a downloading kiosk, and I’d pay a few dollars extra to get yet another memory card if I didn’t have one on me, as long as the value proposition is that I’m paying near cost for both the content and the medium and I wouldn’t be restricted to off-load the movie to my computer when I got home. The tendency would be to charge a premium for the medium itself since it’s a hard cost of the kiosk provider, and I think that savvy consumers would balk at that. Now if I brought my own storage whether it’s a hard drive or a compact flash card to a kiosk – I should only have to pay for downloading the content. By purchasing a new pre-loaded card – I’m essentially paying a convenience fee since I get it as soon as my credit card clears. This means that I can grab it a board my plane immediately instead of waiting a few minutes for it to download to my own storage medium. The flip side of this is that if I did want to wait approximately 15 minutes, I could have my choice of the kiosk burning a DVD or downloading to a multi-card read (I supply the card in my choice of formats) or even any flavor of USB, Firewire, Ethernet or Wi-Fi. Any consumer device that is capable of displaying that content will surely have at least one of those inputs. And the new smartphones/pda’s will have enough storage and connectivity to act as infrastructure to utilize this service. I personally think that SD/MMC cards are going to rule the day due to size/capacity/cost issues. Since you have a record of my purchase – the content is mine when I log into your website or go to another kiosk – even if I lose the card itself, which I of course would have to pay for out of pocket to replace.

    Comment by MarcH. Nathan -

  21. First time reader and I’m pretty overwhelmed by the the info that your sharing. In the feild of HD, which satallite or cable stations or companies do you see taking off in the near future and what do you see the average household familly need to convert to this?

    Comment by Christian -

  22. No showcase content? Just download the HD trailer for this film:

    http://www.meetthefockers.com/trailer1.html

    Comment by Bill -

  23. HD is quite impressive getting the chance to see this year at the NAB (National Association of Broadcasting) the quality and how it just intensifies the experience honestly it’s amazing.

    Comment by Jessica -

  24. “…9 GBS, at the low end. Thats 10x.. Do you see upload and download speeds increasing 10x in the next couple years? I dont…” – well, I do. Just check internet2 solution. Current transfer record for ip v6 is 860 gigabytes in 970 seconds over 10959 kilometers. For ip v4 it is: 838.86 gigabytes in 1588 seconds over 16343 kilometers. The router record is 92 terabits of total throughput (http://tinyurl.com/4ludx). Time will show when everybody on the planet will get such highstream access. One more thing about storage: Seagate and other hard drive manufacturers already are working in labs to achieve magnetic recording areal density of 1 Tb/in². Just imagine it. Last but not least: 1 TB is 1024 GB. Seems all Americans do not know that🙂.

    Comment by Chris -

  25. Maybe a bit presumptious to compare this to Christopher Columbus….but the point is that we have to push the envelope of the known and delve into the unknown. The idea of HD content on a harddrive or USB drive is exciting, however the harddrives could be costly and the USB can be choppy. But heh, does anyone remember Nintendo? Take a cheapflash drive stick a movie on it encase it in a thin “candy” shell with a lovely picture and voila! You can make blank cards to record movies onto or whatever, if your looking for reusable storage. Also it would be more durable than those darn plastic discs that always scratch. Heck you’d open a whole new market for players that could run on the size of a handheld device and even link to your TV. You’d still face the same piracy concerns, however with the way technology progresses then “other side” progresses too! Maybe a “DRM type” solution could be applied. Either way, Mark, your idea is great in that in tests the boundaries of “current” thought, which is always the catalyst of the next “best thing”! If man got discouraged of all the nay sayers then we’d still think the Earth is flat!

    Comment by Simants -

  26. Mark,

    You make an excellent point about the industry players fighting for control over the next standard. As a previous poster mentioned, content always wins, and we’re unlikely to care about the particular storage format. Convenience and to some extent quality will also be important, though historically super-high quality hasn’t been important. (eg: jpeg is good enough for most things)

    You talk about a few different storage channels, but dismiss a wire pretty quick. How long does it take you to drive down to the video store/supermarket/etc? If I can start streaming a movie almost immediately, I’m happy for it to be in a reasonable 8Mbps compressed format… My TV isn’t that great…

    Wires aren’t good for massive amounts of data; but consumers might not even want high quality if it means convenience, low cost, and availability right now.

    -cje-

    Comment by Clinton -

  27. Just amazes me how quickly “new” technologies become obsolete – it creates cycle upon cycle of upgrading your entertainment hardware and media collections.

    Comment by Peter -

  28. What about the Cable TV pipe as the preferred medium for distributing very HD content? Does today’s upgraded Digital cable pipe offer the raw bandwidth to carry this type of download?
    Or would they need to go through another entire cable upgrade cycle to handle the demands of HD distribution traffic?

    Comment by mike schneider -

  29. I agree with the person who first responded. This will not kill piracy, only help it. Currently you can download a movie of resonable quality, a DVD rip, at about 700mb. Even if you switch to HD people will develop ways to compress that footage. The only difference is the authors of such software may have to develop a way to reduce the definition and quality back to the standards we know today.

    And your Kiosk idea sounds great, if you are one of the few people on the planet with the cash. This idea completely stinks for the little guy. And the people who have no idea how to use this technology get completely left out in the cold, most DVD users like the fact that they merely have to insert the disk and play, not have to mess around with licenses and codecs.

    Comment by Aaron Clarkson -

  30. Mark, quick derailing and potentially repetitive question, but oh well its my first time here: (exhale)

    What HD TVs do you own and prefer?

    (I am assuming you own many and they are probably out of my price range but can’t hurt to ask)

    Comment by Josh -

  31. One other person, that I could tell, mentioned the upcoming HVD (Holographic Versatile Disc) format, which has a 1 TB target density.

    Given it is the same size as CDs and DVDs, I think much of the non-tech-ish public will go for them before they will go for other more abstract concepts. Getting my dad to understand terms like “need more bandwidth” is much more difficult than “stick disc in player”, which he is presently very comfortable with. You say the word “bandwidth” around him and he’s calling me, because he’s thinking “that sounds like a computer problem.”

    Not sure if the previous HVD referrer noted the manufacturer article or not, but here it is:
    http://www.optware.co.jp/english/what_040823.htm

    Addendum: Re-reading the previous posts I see that someone has, in fact, already posted the above link. So I am somewhat redundant. My apologies. But I’ve already done all this typing so… it stays.

    Comment by Shawn M. W. -

  32. HD-VOD

    Will the bandwidth of current DSL, Cable, etc. become larger to support HD-VOD – yes, the real answer is when, not just for a select few but for main stream america, at a cost that is affordable.

    Sure I could have an OC3 or OC12 line connected but unless I own the mavericks or some other large sport franchise, I surely can’t afford it

    Eventually the technology will become cheap enough for all the baby bells to offer it

    but one of the caveats will be who pay’s to store the content, sure storage prices are decreasing but the size of the server farms that are required for HD-VOD content along with the maintenance of it will be enormous.

    but in all, High Definition sets need to break $500 barrier for HD to truly take off.

    Regular VOD

    Currently my local cable station is providing VOD (via a service called iControl) and not just a little bit of content but a variety of movies from Premium Channels (HBO, Cinemax, etc), along with other cable channels. They don’t require me to wait 15 minutes but almost instantly appear with features of pausing, rewind and fast forward. At first I thought this was a great feature but then it turned more into a fad, sure there was a couple of things I watched but in the end it was just there. Would it had made a difference if it was in High Def. – NO. It really was that even with the variety of content there wasn’t anything that I really cared to see.
    Sure I could of paid a few more bucks to get some more iControl channels but then Blockbuster Video came out with their new NetFlix like rental system so I cancelled the VOD capabilites and used the money for the Blockbuster service.

    I used to use NetFlix but with the same feature’s now at a brick and mortar store BlockBuster. I am capable of catching about 2-3 as many movie’s as before with netflix, plus if I end up getting a bad movie that I didn’t care after watching it, it just means a 5 minute trip down the street.

    DVR

    since recently moving and utilizing a DVR from my local cable provider, for me this has become god send (since I supervise a 2nd shift). But ultimately I can see DVR turning more into a HOST and SLAVE functionality. where there is one central device (slave) that records all content that the different HOST in the house have asked to be recorded. But there’s only one problem with this. There never is enough disk space.
    Sure you can buy more storage, but where does it end.

    My advice, let the cable companies control the slaves, this way instead of being able to record 1 or 2 shows at a time you could record say 1-10 shows at a time with complete DVR capabilities.
    BUT – let’s make this even sweeter by making the host cable box with the ability of recording your show’s off to a DVD, for offline viewing (computer, friends house, etc), hell you could even have it save the contents like mark was talking about to a USB Drive.
    As for copy protection – just embed the cable customer account info. in the stream that gets recorded – this way if it ever shows up on the net you know where to go – This is what they did for the movie’s that we’re being nominated for an Oscar, so when the movie showed up on the net, a couple of black and white’s showed up the would be person that placed the movie on the net.
    Damn with this type of setup it would even be possible to have show’s record by your cable company and you could watch on the road via the net. (depending upon the quality desired and bandwidth available)

    this cable HOST-SLAVE option has many avenues not only for the consumer but for different business offerings that cable companies haven’t thought of yet.
    Hey if you take this idea – at least give me some credit and a few bones wouldn’t be bad either. (plus I left a few things out)

    PIRACY

    Like it or not movie piracy is here to stay, first there was software then music or that could be music, software, movies (if you count 8-track or audio tapes). Personally I have had a friend give me a bootleg movie that was downloaded via the net. After watching it I wish I didn’t. Not because I feel that actors and movie studios don’t make enough money, but the quality was horrible. From the sound to the video. For me watching a movie is more of a experience (7.1 surround sound system, big screen TV, Tactile Transducers in the couch (sweet, but I’m sure nothing like what Mark may have)).

    These are the things that movie industry’s need to focus on to change the perspective of your average john doe on why not to download movies. – QUALITY (sound and video) -, Plus with blockbuster and netflix unlimited rental program – COST -, without having to find a movie via the P2P then downloading it which could take hours/days – CONVENIENCE –

    I believe the RIAA is finally starting to learn this via what apple has done with iTunes – sure mp3 will always be copied but once you start using iTunes the only time user’s turn to P2P are for things that may not be available.

    QUALITY – COST – CONVENIENCE

    kwik67@sbcglobal.net

    Comment by Dan -

  33. Mark says no one has tried pirating HD, so it will answer the “piracy” problem of HD content.

    No one pirated standard content (or DVD) much till the new compression methods came along which provided same quality in lower bitrates and the network capacity increased to accomodate the content quality.

    When the two (compression and bandwidth) cross over for HD quality content, the same thing will apply.

    Comment by Peeyush Ranjan -

  34. Mark
    In your comments, questions and statements section you asked a very reasonable question about Media Center PC manufacturers and Cable/Satellite Service providers partnering up to give Set-Top-Boxes (STB) capabilities to MC PC’s. Assuming that MS and PC makers have no qualms in being able to offer this to consumers, it would stand to reason that the service providers are hesitant since they have Revenue models that include leasing/selling STB to their customers. Another reason maybe that conditional access for premium and pay-per-view offerings is not secure enough when passing through PC, think of the Piracy “Gool” Hollywood promotes. Do you have anymore thoughts on this?

    As far as HD content goes why is HDNet only available through cable and satellite providers? You mention tuner cards that allow you to watch HD content via a PC, and I assume an Antenna for reception of Free to Air (FTA) Broadcasts from local TV networks. Has HDNet tried to get air time from any of these broadcast centers to provide HD programming to consumers with appetites for it? When I last looked there were 12,000,000 HDTV’s sold domestically in the US, and with the price of HDTV’s dropping (you can now buy a HDTV for under $1,000.00/ not the plasma type but still and HDTV) it seems as though many have the ability to receive HD content FTA. I know that it is difficult in some areas to receive the signals, but a starting point is necessary even if only 50% of the country receives it. Everyone is talking HD this and HD that, and I think it is great to have the discussions, but its time for someone to act, and show the consumers that this is a real upgrade to what we have today. Till then the switch over to digital standard will just be a political game ball, much like the one used by NBA.

    Comment by Jake -

  35. Where does something like the IOmega REV drive (that use 3″ 35GB cartridges) fit into this? It has very good speed (similar to external USB hard drives), has good portability using removable cartridges, and has pretty high capacity (with higher capacity on its way). The downside is that the media is proprietary. If the storage industry can come up with a standard using this model and lowered prices of the media, wouldn’t this be ideal?

    Comment by Sam Wong -

  36. You have think positive and vision what could be possible in the future. Frankly, everything that you know now will change almost completely in 5 years. Take the Internet, did you ever hear of the Internet II? Probably not, but it is being used by the government and universities and coming eventually to a computer near you. The difference is speed, protocols, and volume of data that could be sent in a blink of a brow. So what ever your storage needs at any given nana second in time fear not, you will be able to download quicker than you can say “red hot chili pepper.

    Personal choice is what will rule in storage. There will be much to choose from. In fact, you might have your own Internet centralized storage of 5 terabytes accessible anywhere in the world. Centralized storage along with your personal portable storage leaves you good to go. Go into Best Buy 7 years from now and you buy all the media content you want saved directly to your centralized “StoSpace” (Could do the same from home). For $10 Best Buy will sell you StoSpace that you can access for up to 1 year – then you renew. Best Buy would also have a kiosk to download to various popular storage devices if you need it now!

    So there you go one simple idea that works just fine. As far as the consumer is concerned the delivery media will not be outdated by the time you pass your next stone.

    Comment by RG -

  37. The future is now.

    http://iomagic.com/Products/show_all_results.asp?ProdID=IUSB22HD

    Comment by Rob -

  38. Mark – how important will be DRM in making content owners assured that their content is not being copied and illegally distributed? For example, if I download movie to my hard-drive I can rip that move just like you did to watch it on other devices but I can also post it to any of P2P networks or share it in any other form of mass distribution without sending any royalties or any other type of compensation to content owners.

    As far as your idea of converging Media Center and set-top box, it’s absolutely fabulous but my question to you is who will give up there? Cable/Satellite providers who want full control over the media gateway or Microsoft, who wants to keep people tied to a PC?

    Comment by Mio Babic -

  39. Mark – how important will be DRM in making content owners assured that their content is not being copied and illegally distributed? For example, if I download movie to my hard-drive I can rip that move just like you did to watch it on other devices but I can also post it to any of P2P networks or share it in any other form of mass distribution without sending any royalties or any other type of compensation to content owners.

    As far as your idea of converging Media Center and set-top box, it’s absolutely fabulous but my question to you is who will give up there? Cable/Satellite providers who want full control over the media gateway or Microsoft, who wants to keep people tied to a PC?

    Comment by Mio Babic -

  40. I MUCH prefer to store video content on a harddrive over a DVD. I have a Dell XPS (the top of the line) with four 200GB internal harddrives. It has a 3GHz CPU and a FusionHDTV3 HDTV video card. It is connected via a LAN to my ReplayTV (RTV) 5000. The RTV has only a 40GB HD, so I transfer the RTV files to my PC every night. The problem is that even with nearly a terabyte of internal hardddrive storage, my PC’s harddrives are FULL. It is full with mostly standard definition programs from my RTV–forget about storing more than one or two high definition programs. Because my PC is full, I’ve had to transfer content to DVDs. Sometimes I’ll compress programs, but the compression programs are generally buggy, the resulting quality is usually not very good (especially when viewed on a good HDTV monitor), and it takes hours just to compress a few programs–which is why I bother to compress only those few programs that I hope to watch on my laptop on an airplane, where optimal video and sound aren’t required. Since my Dell can’t handle more than 4 internal harddrives, I’ve started attaching external harddrives via USB2 and firewire. But this starts getting very expensive (at least for us non-billionaires) and physically complicated. So while I like storing on a harddrive, by necessity I also need supplemental DVD storage.

    Another major issue with harddrives is backup. Every night I go to bed praying that one (or more) of my harddrives doesn’t fail because it is impossible for me to backup these harddrives. I would need to get 4 additional harddrives to do backup (not to mention more for the external drives). So I keep the most important recordings on DVD (if they can fit–sometimes I back up to analog S-VHS tapes) and pray for good luck. One backup solution would be to use RAID-5, but Dell (and no other PC maker I know of) doesn’t support internal RAID-5 in their PCs. I’ve looked into external RAID arrays, but usually they require SCSI disks and are very, very expensive (meant for high-end datacenters) and SCSI disks usually have lower capacities than ATA. Especially with the new SATA technology, creating a simple external RAID array wouldn’t seem to be that hard, but I can’t seem to find a way to do it.

    So until these problems with harddrives are resolved, I hope higher capacity HD DVDs come to market quickly, since backing up to measly 4.7GB DVDs gets old quickly.

    Comment by Eric Tsuchida -

  41. “Holographic storage” and “increased bandwidth”

    Sprint just set the world record for sending 4 Gigs p/second. They sent 840 gigabytes of data 10,155 miles from San Jose, Calif., to Sweden in less than 27 minutes. So you can make the quality as good as you want, but bandwidth will keep increasing.

    That is the kind of speed that we need at my house house!

    Also have you heard of “holographic storage”?

    “The basic concept is that data is stored as patterns of light in three dimensions instead of as 0s and 1s on a flat surface. The promise is storage capacity and transfer rates an order of magnitude greater than today’s DVD discs. Imagine 2GB of data in an area the size of a postage stamp or a disc the size of a DVD that holds 20 full-length movies instead of just one.”

    Just a couple hurdles to think about.

    Comment by Greg Wilson -

  42. I’m wondering which angel saved you from loosing big money, ’cause this post shows lack of understanding of digital video’s basic concepts. No offence, but stop investing before you bye a book or two covering HDTV, MPEG2, MPEG4, H.264, etc.

    Best regards,
    IT

    Comment by IT -

  43. First, excellent and illuminating thoughts. I’ve enjoyed your ownership of the Mavs, and now I’ve enjoyed your ideas in your blog.

    I have had similar thoughts. My expectation was that Apple would add video content to the iTunes Music Store, where you could search, rate, select content (into a movielist) and have it delivered in either two ways – overnight to your house via the Internet, or via a kiosk at an Apple store and/or partner stores (like Starbucks or trendy 24-hour drugstores/supermarkets). My view was that this would happen next year as Apple was focused on Hi-definition content as it would require customers to buy expensive new DVD players; so what better time to offer an alternative.

    For the kiosk, the customer would bring the USB/Firewire hard drive or flash drive and plug it into the kiosk and login (like Mobil speedpass); then it would automatically update the content in accordance with what was selected at the iTMS (or the customer could reselect on the spot). Using knowledge of customer’s addresses, the servers in the kiosks could be updated with the selected items and/or most in-demand items. The customer could shop or have coffee while the system downloaded the content. When the customer got home, the disk is plugged into a computer or home entertainment system and content easily selected for playback.

    This would most likely be a monthly subscription fee system ($20-25) whereby the customer could check out as many as 30-50 movies at any one time, and change selections whenever. Each customer’s version of the content could be embedded with unique marks tied to the customer’s account number to deter piracy.

    Compared to Netflix, you could have not 3, but 30-50 immediate choices at any one time (if you have a large hard drive – Apple would make money on selling the hard drive devices and home server-display system), and a shorter delivery time between selection and delivery (immediacy).

    Compared to video rental stores, again you have more immediate choices on the HD, altho delivery is the same (the time it takes to go to the store). Compared to VOD, it would be less spontaneous and fewer immediate choices, but the choices are more likely to be personalized.

    This was just an idea so I didn’t work out the costs of running such a kiosk system against the potential revenue from subscriptions as well as sales of hard drives and home server-display systems.

    Comment by KJ -

  44. http://www.engadget.com/entry/9772446245622191/

    and

    http://www.optware.co.jp/english/what_040823.htm

    Comment by msew -

  45. Even if you have a high speed connection, for someone to host HD content for free download they would need a lot of money to do that. No one would ever shell out that kind of money. If you want to keep the a movie you purchase on hard drive, just uploaded to your home server. There’s a company out there that offers a hard drive dvd server that can hold up to about 5000 movies. Having a lot choices in programming is good but what if all of that programming was watched on a black and white tv set. I mean the difference between HD and SD tv it’s like color and black and white tv. Who watches in black and white anymore? I agree with Mark in that dvd technology is a lock. The profit margin for current dvd player is $1 so they need new technology to drive consumer into purchasing new hardware. Let just say that in the future there will be HD2 and blu-disc won’t have enough capacity to hold the new content then we will be force to buy new hardware because the studios refuse to distribute movies on that format. Whereas, if you adopt in an evolving technology like the hard drive you can hold any kind of content you want. In reading his blog, it has open my mind to new possibilities and business ideas. Thank you Mark.

    Comment by Vinh -

  46. Mark,

    I think that your article here makes a lot of sense for what is transpiring currently in the content distribution business. However, I believe that there are a number of ways to deliver content that make sense that you haven’t addressed. The one that I have worked the most on in a commercial sense is the delivery of HD content in a store and forward manner over satellite (IP over DVB). Typically we find that HD content is being broadcast today anywhere from 19.2Mbps to upwards of 30+Mbps, depending on the network and mechanism (satellite vs. over the air spectrum). Anyways, with the price and cost of satellite ip infrastructure coming way down and new players on the market driving that cost down, there are many ways to deliver content. In the kiosk example you could deliver content with a dedicated link of say 30-40Mbps of data which would put you 1-2x times real-time in content delivery, with storage at the kiosk you can pretty much hold all the latest content and change it as needed. Also, considering that the content library is pretty static, and customers choose from a “walled garden” of available content you should be able to get the content there as needed. This also works in the home environment with a multicast approach and storage on the STB, where you can deliver the requested content to the multicast receivers that are subscribed, record it to disk encrypted and play it back as requested. Now of course this requires equipment changes by the customer, by as you know networks like VOOM are moving in that direction to deliver content that is not available anywhere else. I think that this discussion will be one that will go on for a while as we see digital media delivered in many different ways, such as supplemental content delivered over satellite networks for popular shows, like they are doing in the cable VOD space (HBO for example) among others.

    Comment by JM -

  47. I think the storage part of your premise is ok as far as one-time rentals go, but for the next 10 or so years it’ll probably still be more expensive than those little silver disks for those that want to own the movie.
    The cost of bandwidth is plummeting too, with projects like Utopia here in Utah, and the high speed power line broadband they’re demoing in West Virginia I think. So that slowing pirating down is a way off daydream

    Comment by Mike -

  48. I wasn’t done, but that posted anyway. What I was sayiing on my rant was i wish they would sell these high-def. TV’s at affordable prices, get rid of these DVD players, TIVO’s, CD Rom, DVR-R, DVR+R, and just go back to what worked in the first place.

    But i guess if i’m mark and all these others that can make a fortune by this stuff, go ahead, but i as a consumer hate it, but would love the financial benefits of it.

    Comment by J.R. Ewing -

  49. This shit is pointless and ridiculous. what was wrong with VCR’s. They were easy to operate and you can record over stuff. Now, DVD’s are more expensive and once you record something, it’s there for life. Not to mention that DVD players are not the easiest to work with when it comes to programming.

    And don’t get the wrong idea, I’m not some old hillbilly whining about the way things use to be. I’m 27, but have never been too thrilled about all this “new tech” crap.

    I’m sures omebody’s thinking right now that all of this stuff is needed because of the new age televisions that have came out in the past few years. I’m sure someone can make the picture just as good going off a VCR than a DVD, satlelitte, and all of this other stuff. I take a peek behind my TV and it is ridiculous. I have so many wires and I don’t even know how to operate half the shit i have.

    The only reason this shit was inventd is to make everyone change their ways so these companies can make a buck. They don’t have to be necesary, but are now because of the widespread use.

    I just wish we could have these high def. TV’s at affordable prices, and get rid of these DVD players( which half of them don’t record)

    Comment by J.R. Ewing -

  50. As I read the post, the model that I envisioned was the one used with propane tanks for backyard grills. You buy a new empty tank. Then to get the propane you turn around and exchange your empty tank for a full one and pay the cost of the propane. Unlike most other purchases, you don’t keep what you paid for (your new tank). But in purchasing a new tank, you’ve basically paid your admission fee to the system–the Exchange System.

    Due to the higher cost of hard drives vs. DVD media, it would probably require this type of initial purchase system. Then from there the system could work quite a lot like the Netflix system of pre-selecting content and send in your current hard drive and a few days later receive a different hard drive with new content. I think we have all thought that Netflix/Blockbuster could be a lot more efficient dealing with DVD-RW’s of content and paying the studio a rental royalty for each burn rather than purchasing a physical library of titles. This would be that concept tweaked for putting high-def content on hard drives.

    In reading previous posts, people seem to be really hung-up on 2 points: if you can’t have Microsoft-sized marketshare don’t bother doing it and TRUE HiDef data isn’t that big.

    Re: point 1. We all know a self-made billionaire who didn’t let pt. 1 stop him.
    Re: point 2. true HDTV >= ~12mb/s.

    I have had a HDTV since summer 2000, and I cannot tell you how strong the itch to store and playback HiDef content has become. At this point the sticking point isn’t the cost of storage, it is a reasonable way to get it to work. I have the following:
    – an HDTV with component inputs
    – a cable box with FireWire out only
    – a computer with FireWire in and can record to multiple external FireWire drives

    But there currently isn’t a good solution to playback the content off the drive. What I am dying for is a FireWire to component video (or VSB coax) converter box.

    Mark wasn’t talking about watching HDTV on a plane as a goal, only to illustrate the storage portability issue. No HDTV enthusiast can be satisfied watch HDTV only on a computer (a HUGE workhorse CPU or with decoder card). It’s the home theater baby! And that is why Mark is decrying the lack of Media computer – HDTV link.

    The Roku HD1000 or Samsung decoder boxes are a start, but why do I have to spend $500 more for chipsets I already have.

    Cable gives me my local channels in HiDef where much of the truly interesting HDTV content is. But no playback.

    If I go with the DirecTV/TiVo/HiDef PVR for $1000. Then I lose some of the channels of local HDTV (ABC/NBC/CBS/PBS/Fox/WB). But get HDNet and ESPN.

    So distribution of hard drives with HiDef isn’t of interest to me until I have a way to watch the data on my HDTV.

    Comment by Craig Doran -

  51. As soon as you say, “file sizes will prevent piracy”, someone says, “I have Fiber To The Home”. What’s the MPAA going to say?

    Distribution via hard drive? Cool, but P2P isn’t the only means of piracy – just the most rampant. I’ve purchased used CDs (I refuse to feed the coffers of the RIAA’s legal fund) on Amazon.com, only to have them arrive as CD-Rs. This pisses me off so bad that I typically report the offender to Amazon AND the RIAA. Care to guess how many times someone has followed up with me on such a report? ZERO. Point being, once blu-ray et al become commercially viable, they’ll become the preferred means for pirating HD content via eBay, Amazon, or street vendors in China, Korea, etc.

    Hollywood fears this, and I, frankly, sympathize with them. That said, I’ll fight to the last for my Fair Use rights.

    There HAS to be a solution, and someone HAS to find it. And SOON. We need some means by which the RIAA and MPAA can be assured that their intellectual property can not be (easily) pirated (at least not in HD or anything close to it) while at the same time assuring that those of us with media servers and HTPCs/clients can continue to enjoy the fruits of the digitial age.

    I’m guessing that the answer has to lie in hardware… some sort of smart card or other hardware “key”, much like the key that prevents (most) people from stealing your car. Like modern-day car keys, such devices could contain settings, user preferences, etc. Also like car keys, the user should have the ability to duplicate them. Of course, the minute you allow duplicates, you expose the scheme to piracy, but, like a car key, the key should not serve to unlock *ANY* car. Finally, as with a car, keys don’t guarantee that your car won’t be stolen, but most of us consider it a reasonable deterrent. I think a “reasonable detterrent” could be found with which the RIAA/MPAA could be satisfied.

    Perhaps this paradigm is full of holes, perhaps something completely different is required, but the underlying principle stands…

    Legislation that unfairly limits fair use rights has already been passed and more restrictive legislation is sought. Draconian technology that punishes the innocent (e.g. HDCP) is being pushed on an unsuspecting public (and even those in the know consider it a “must have” feature) and so it permeates the tech sector with few people raising any red flags. If a reasonable compromise is not found – one that protects intellectual property rights while also protecting fair use rights, some distasteful alternative will be shoved down our throats by the RIAA, MPAA and the Congressmen/women that they keep in their pockets.

    It’s quite clear to me that the impetus to find such a compromise rests with those of us who TRULY value our fair use rights (and/or to companies like HDNet that are sympathetic to our plight.) Figure this out, and I think content delivery will resolve itself.

    Comment by Elvis Incognito -

  52. Good discussion here. Here’s a question though.. Why would the movie companies (Sony, Fox, Universal etc.) even want to change formats? They are making good money off DVD’s and now ONDEMAND. Is the potential profit that much greater? Wouldn’t the risk be a lot greater if content was distributed like MP3’s are? You have to think that the movie/television industry is looking a the music industry and saying.. “Whoa.. We don’t want that to happen to us.” MP3’s haven’t made the music companies a lot richer. Just people like Steve Jobs.

    There must a bunch of better ways to distribute media than DVD’s. Often the best way isn’t the way things get done. More times it is the most profitable way that is pushed.

    Hey Mark.. You traded Antoine and never really made a comment. Being a Celtics fan here I feel for the guy. Why is it he gets such a bad rap.

    Comment by MattyB from Riverdale -

  53. Mr Cuban,

    Your analysis is definately correct, though the price of flash drives needs to be at the same price point as a blank DVD or CD. That is what will really drive them to market. CD burners did not “take-off” till the media cost about 15 cents. It is all about the cost of the media. People have become use to renting a movie or buying a DVD at price “X”. As long as that price does not rise, then what ever “convient” media is available will eventually be adopted.

    It is the “transition” that is really the issue. If electronics manufactures would build devices that allow the user to slowly transition to something new (ie DVD/CD player that can also play movies from compact flash) then consumers will be more likely to buy into the new technology. That is as long as we don’t have 20 different format wars going on.

    Comment by Philip Grossman -

  54. Thanks for this article on HDTV and memory.
    I must have my head in the sand because I
    had never heard of a “Media Center PC” before.
    I looked it up and it seems like a really cool
    idea. Also, putting a movie on a “thumb drive”
    for watching on a laptop while on a plane is
    also a pretty cool idea. Thanks for the info.
    Go Mavericks!!

    Comment by Woody Pope -

  55. I dont know if anyone posted anything about this, but maybe this could be a solution, like all others expensive at first, but with time that could change. Should be better than blu ray. This is the article.

    A Japanese company has achieved the world’s first reliable recording and playback of digital movies on a transparent holographic recording disc.

    Optware plans to offer reader/writer players and 200Gbyte holographic versatile discs (HVD) in 2006 for enterprise users.

    Much less expensive consumer versions could be on the market by 2007, said Yasuhide Kageyama, manager of business development and marketing at Optware.

    The company has developed a collinear holographic data storage system that uses a green 532 nanometer laser to read holographic data on a 12-centimetre disc.

    Light from the laser is split into two beams. Data to be recorded is encoded onto one of the beams while the other beam is used as a reference. The two beams interfere with each other inside the disc’s recording layer and in this way data is stored.

    Below the recording layer is a pre-formatted layer that stores servo data and is read by a red laser. This enables accurate tracking of the disc.

    Between the data layer and servo layer is a mirror layer, which reflects the green laser but is transparent to the red laser. It is this mirror layer that is the secret to HVD, said Kageyama, because it stops the scattering of light within the disc that could cause noise and deteriorate the signal quality.

    The company is initially planning to use the technology for enterprise applications. Drives for this market will cost about $20,000 (£11,075) and initially use 200Gbyte HVDs, with a target cost of about $100 per disc.

    Drives for home users will cost about $2,700, about the same as commercially available Blu-ray Disc players now.

    Comment by Angel J -

  56. The size vs quality issue will create a caste system for media files. Need it small and fast? You are lower caste. Want huge files extreemely high quality and you have the $10 K in equipment to get the most out of it? You are upper caste.

    I think Mark is glossing over the fact that a handful of well known technology companies ( telcos & telco equip. makers) have credible plans for deploying terrestrial terabit + networks. That quashes the idea that making the files bigger makes them harder to move.

    We are now just starting to see a change in people’s behavior – a la viewing media – PVRs like TIVO are creating a whole new type of consumer who does “need it now” becuase they knwo that TIVO is getting them what they want and they can view anything they want on Sunday morning (can you say good-bye to networks being able to charge a premium for “prime time” commercials?).

    I’m from the generation that was lucky to see 3 hour of cartoons on Saturday morning ( and was fooled on Sunday into thinking that Davey and Goliath was not religious indoctrination), but look at how the 15 and under set are using the myriad of technologies to their advantage. these are the peole who’ll have big chunks of disposable income in ten years, and they have been trained already to be early adopters, and rapid swtichers of technology.

    They’ll view and use media in completely different ways than we think of right now.

    Most of the answers on this blog reflect the question “What do people want? like…now please” but the real qustion is “what WILL people want?”.

    I see a market 10 years from now where transferring files of terrabytes will not take long periods of time, where widely deployed media center PC will be proactively set to retrieve favorites for their masters, where small form factor but HUUUUUGE “hard drives” – micro flash cards, (not discs tho – nothing should have to physically move, juts asking for a breakdown)will be easy to own (Cheap$) and move, where it’s all too easy for anyone with determination to make some copies and fling them off to friends. We can’t fight it, we msut roll with it.

    Throughout industrial history, legacy technologies have fought the “new kids on the block” as opposed to enbracing them.
    Mark is right that big media comanies are playing CYA for near term profits, but he also very ccurate that somebody is going to do something private and smart (there is a kid in the 9th grade in Clevland today that will do it) that will rock all opur worlds and set us on a new path.

    Forget what 40 year olds want, think about establishing the new way for 5 year-olds to get what they want.

    Comment by Kevin -

  57. Mark, you can download some HD files over at suprnova, just search for HDTV or browse the movies/TV section for files. Filesoup/Hawkies also has some.

    Bit torrent like apps make most HDTV files downloadable for pirates. Most initial uploads are from compromised corporate servers, you hack into a box, ulpoad your files then begin serving via BT, this can get you 100Mbps transfer and when spread over hundreds of users downloads are reasonable.

    I got last season’s Sopranos episodes on HDTV, within hours of it being on HDTV HBO I was downloading it. Again, I’m in the UK so that is my excuse, I wouldn’t see it for months, a weak excuse but i’m sticking to it.

    Using bittorrent is the most common p2p network now simply because it’s harder to spam bogus files like they did with Napster/Kazaa. Usenet is too unreliable as you said, bittorrent and the other split sharing programs have huge redundancy once the seed has been planted.

    Asynchronous connections in part slow down the spread of large files but there’s always a way, like seeding off foreign servers where you can get ethernet connections.

    By the way, there’s not really an email address listed for you, do you take business mail through the mavs address?

    Comment by Kanes -

  58. Over-air broadcast HD has been regularly ripped/posted going back easily to 2001. For web-posting, it’s posted in SVCD, DivX, or Xvid formats. Most of it of course on darknets and Usenet alt.bin groups. All is comparable to MPEG2 DVD quality.

    But when you’re watching “CSI” or “Sopranos”, the difference is only marginal between the latter two formats, e.g. as compared to HD. There’s probably a greater difference with live events and sports — but we don’t archive/share those programs the same way as set-filmed content, i.e. we wouldn’t want to re-watch the entire 95-96 Bulls season, but maybe we would want to pick out a few games (ala ESPN classics-style). Usage patterns, as defined by the type of content, should have effect on our piracy tendencies, and thusly has effect on content size/compression/transmission/creation decisions for an entity like HDNet.

    Best,
    -Michael

    Comment by Michael Schwartz -

  59. One consideration in favor of hard-drives is that the new SATA standard, in addition to being faster, allows 1 meter (~40 inches) of cable from the controller to the drive and has a brain-free connector. The old AT ribbon cables have a limit of 18 inches with a connector that is both more fragile and complex (red wire to pin one … which is pin one?) This means that SATA drives potentially have firewire like plug in the back capability without the need for any fancy internal controllers … just a cheap case and some power.

    Another interesting point is that most broadband providers have lots of bandwidth headroom between them and the customer (if your limit is dsl distance from CO, there are some new things coming) the limit is largely their upstream connection to the Internet. Obviously, cable company ISP broadband providers are in a great position to off-hours stream to PVR devices, but phone companies would be willing to jump on that wagon in nothing flat if there was money to be made … and there will be. Satellite will have no trouble. There just needs to be an awareness and market.

    Finally, first the record lables and more recently movie studios are enjoying a cheap boom because people are re-purchasing stuff they already own on CD and DVD. Partly becasue they LAST and partly because they’re BETTER. When I got a DVD player for my PC back in ’97, I had to copy “Dangerous Liasons” to tape and take to a friend’s house to watch. The surprise was that the dub I made using a $15 stablizer (same one from ’92, just add another 9volt) and a 6 year old Hitachi VHS deck was BY FAR the best image I’d seen since I saw it in the theater.

    I’ve seen HD cap images and they’re gorgeous! I live in the boonies (NW Vermont) and can get digital cable but none of the converters have a s-vid out … what’s the point? If they start offering HD, that’s when I start getting the premium packages and looking closer at HD monitors.

    Comment by Clint Grimes -

  60. I like the way this guy thinks. Finally, a tech-saavy rich guy that isn’t a tightwad. In many ways I agree with Mark’s vision. DVD-ROM and other hard media like that is old school and on the way out. Especially for the usage that Mark is talking about. If you are watching a movie on a 7″ sceen on an airplane you are not going to notice the difference between Xvid and the original DVD. So with today’s technology you can already imagine a video version of the iPod. With a 40GB drive you could store 60 movies. OK, but with a display built in it could cost as much as a laptop. Although display and storage prices are falling so it could be realistic. Or instead, satisfy the copy protection folks and make a display panel without storage, similar to a tabletPC. Except much lighter, thinner, and less expensive. And with a SD card slot for input. So, an 8″ widescreen OLED panel with a battery, two headphone jacks and an SD card slot. And a little stand to prop it up. And then set up kiosks where people can purchase content on their SD cards. Walk up to the kiosk. Pop in your 1GB SD card. Select what you want from recent movies, TV shows, music videos, whatever up to the available capacity on your SD card. Pay a small fee and have it copied on to your card as you wait. In 4 minutes you’re on your way with 3 or 4 hours of video to watch on the plane.

    Comment by Andy -

  61. Increasing the quality of file formats will have zero effect on piracy whatsoever. Here’s something else that hasn’t been changing at the rate of data storage: video resolutions. If current Divx/Xvid compression can take a movie to 700 MB at 640×480 and still looking great, then that’s 2.8 GB at 1280×960 – a perfectly respectable download. Are there going to be any monitors released in the near future on which a full screen movie at that resolution will not look fantastic?

    I frequently watch movies on my TV using an Xbox (streaming across a network to XboxMediaCenter), whose native resolution is only 640×480, and they look great. I download rips of HDTV broadcasts at 350 MB per hour of video, and they look great. Are they HDTV quality? Probably not (I’ve never seen an HDTV broadcast in all its glory), but from how watching compressed movies on a TV looks, it doesn’t make me feel like I’m missing out on anything.

    Piracy will still happen, for the simple reason that you can only get up to a certain resolution for any given screen size before further improvements in the resolution just won’t be that noticeable. You can make an uncompressed file format to distribute movies at 32768×32768 resolution or whatever at 99 GB per minute of video, and it will look just as good at 2048×1536 compressed – so which format do you think pirates will choose?

    Comment by goofyballer -

  62. While I agree that the DVD is rapidly becoming unattractive in comparison to hardrives in terms of quality doesn’t negate the fact that Dvds have an inescapable advantage-they are stamped mechanically in a fast cheap and content independant manner. Once mastered the current cost of manufacture( a few cents of aluminum, some polycarbonte resin and voila a stack of shiny discs) is going to impede higher quality alternatives.
    Currently pre recorded hard drives ( os on computer etc) means hooking up the drive, formatting recording and unhooking- labour/ capital intensive compared to a stamper in a dvd plant- espcially as content producers tend be wary of any business model thats not an analog of successful pre-existing businesses

    Comment by Neil -

  63. I live in Sweden. I get 10Mbps full duplex Internet access thru an Ethernet jack in my apartment wall. This is connected to a switch in the basement of my apartment building, which is connected to a city-wide fiber ring. My ISP peers with other ISPs at interconnects in the major cities, so cross-network bandwidth is also good. For this I pay 320 SEK/mo, which is about $43. If I wanted, I could upgrade to 100Mbit, which would cost me $80/mo.

    Now, not everyone can get these speeds as it takes an installation of a LAN in the building, but ADSL/VDSL is also quite widespread here. 71% of the Swedish population can get 8Mbit/0.8Mbit ADSL at a cost of $60/mo. If you live in one of the bigger cities, VDSL with speeds varying from 8/8, 12/9, 13/13 to 26/26 is also available.

    P2P filesharing is huge here, and the preferred method is via Direct Connect. New releases appear very fast and are most of the time of good quality.

    All of this combines to make this a very tough market for the traditional media companies, and it will grow even tougher as the young generation grows up, being used to the ease of downloading that they are. It will be very interesting indeed to see how the corporations plan on tackling this. Hopefully, it will be in a different way from what they’ve tried up until now. Your ideas are some of the things that could work.

    Comment by Mattias -

  64. So if bandwith is the limiting factor, the fastest way to send lots of bytes will still be via USPS! What difference does it make whether the platform is a HDD or DVD? If anything, it’s a helluva lot cheaper to press a DVD than it is to make a HDD.

    I too am excited about the prospect of virtually limitless random-access storage, but that all by itself doesn’t make me want to trash my DVD player. I think you’re on the right track, but you’re not quite there yet.

    Comment by Cancerdoc -

  65. I really like the idea of movies being put on USB HDs. I really don’t like DVD’s becasue the skip a lot and get damaged way too easily. You’d have to hit a USB drive with a freaken hammer to break it. With a USB HD, you plug the thing into your laptop and BAM it’s there – no waiting around for the hitting eject/disc read times/etc. There is just some sort of satisfaction about plugging a cartridge in N64 style. I never liked having to go through the irritating processor ejecting the tray, placeing the CD in the tray, hitting the eject button again, and then waiting for the disc to read. I wish they would make games on USB no CD’s.

    I don’t think it will stop piracy though. I mean true, it will take a whole day to download a 10 GB high definition file on road runner, but a lot of people have college connections with 100MPS speeds which will make the DL speeds an hour or two. Either way DivX makes the files really small, and with great quality too, so I think that their will always be piracy, becasue the quality difference in DVD’s and DivX isn’t that big.

    Comment by jon_k -

  66. Brilliant! But it better have 200GBs when technology allows.

    Comment by Chris McCaw -

  67. a couple things…. anyone know any FREE Usenet Providers that will let you know HD files from alt.binary.hdtv I dont

    Any I have ever seen costs 10 bucks per 10GB…EasyNews is 10bucks, GigaNews, probably the best is 25bucks for unlimited bandwidth for 1 single month….

    And the ever opening and closing bittorrent locations are hit and miss at best and still kill hosts bandwidths and collapse before completion enough of the time to make downloading more entertaining than the movie you are watching….

    if someone has a place to download hd that is free, i want to see it…
    So few if anyone is getting HD files for free… now it is possible to get files that used to be HD and have been compressed to maybe DVD quality…. but you are still paying for bandwidth, and so is the person/company hosting the server with the files….And they are going to

    Comment by Mark Cuban -

  68. The part you’re missing is the fact that the entertainment industry is worried about people having or sharing any of their content without going through their avenues.
    It’s worse if pirates can duplicate a copyrighted work in exactly the same quality. But people will accept a loss in quality for accessability. The music industry is still after piracy of their albums because the capability to transfer full cd audio over p2p exists, but people dont do it because its not convienient in relation with the loss of quality.

    Comment by Jakesus -

  69. Mark,
    as always, good thoughtful piece on how harddrive prices and capacity will outstrip broadband penetration and speeds. I have been tracking hard drive prices/capacity for a couple years. You can see the latest graph at: http://www.martinandalex.com/blog/archives/2004/08/hard_drive_pric_3.html

    Comment by Martin Tobias -

  70. There’s quite a bit of HDTV copying/piracy in the underground, or so I hear. Movies, clips, live music is all there, it’s just that it is not even close to the amount of DVD piracy going on today, and really, not many people are into it at this time… Give it a few years, or perhaps when more of the US has connections like they do in South Korea and can afford to waste bandwidth on HDTV content…

    Comment by dan wu -

  71. sneakernet: /snee´ker·net/, n.

    Term used (generally with ironic intent) for transfer of electronic information by physically carrying tape, disks, or some other media from one machine to another. “Never underestimate the bandwidth of a station wagon filled with magtape, or a 747 filled with CD-ROMs.”

    Also called ‘Tennis-Net’, ‘Armpit-Net’, ‘Floppy-Net’ or ‘Shoenet’; in the 1990s, ‘Nike network’ after a well-known sneaker brand.

    Comment by andrew morton -

  72. I think your NetFlix-like HD/Flash drive scheme can work in another way too: even though many regular series are schlock, if people want them, they want them. Let people choose to receive X hours of programming a week, by setting up their own program grid – I can pick what show airs when, store those choices via web site (ala NetFlix), and each Monday you ship those to me. This would include series television AND movies. Once I get the disk, of course, I can rearrange the schedule of that content if I want, but each week I know I’m going to receive a disk with my favorite shows.

    This works because it plays to the same reason people love PVRs – they’re not at the mercy of the broadcasters’ scheduling anymore.

    Also – if you can make this compatible with older equipment, to ease the transition for folks who can afford a hard drive but not a super TV, you’ll get incredible customer loyalty when that person finally gets his/her HD television.

    Comment by Tim -

  73. Todays’s DIVX quality movies (As you demonstrated on your plane trip – with whatever compression you were using) are quite watchable.

    Why does someone need a 10gig+ file to enjoy a pirated movie? When they look fine now at 512mb?

    I think you’ll find nothing much will change, aside from non pirated movies will see a nice quality improvement.

    Apart from that, why couldn’t piracy continue as per usual. If the files too big… drop the resolution and up the compression. 2 hours video is still 2 hours of video. It just won’t be HD quality video.

    I’m sure the majority of people pirating on their P2P networks couldn’t care less.

    Very interesting blog entry tho.

    I think rabbit probably said it best with “free is better than high quality”.

    Not everyone is a high paid CEO.

    I love my Google Mail, it’s free for me, yet they make money off me with their _UNOBTRUSIVE_ advertising.

    I found the promotion of products in I-Robot interesting… considering we PAID to see the movie, not a converse/audio avert😉 But we will try to make more money thru _any_ avenue, won’t we.

    I don’t think filesize is the solution to piracy. I just don’t see it I’m afraid.

    Comment by Will -

  74. Todays’s DIVX quality movies (As you demonstrated on your plane trip – with whatever compression you were using) are quite watchable.

    Why does someone need a 10gig+ file to enjoy a pirated movie? When they look fine now at 512mb?

    I think you’ll find nothing much will change, aside from non pirated movies will see a nice quality improvement.

    Apart from that, why couldn’t piracy continue as per usual. If the files too big… drop the resolution and up the compression. 2 hours video is still 2 hours of video. It just won’t be HD quality video.

    I’m sure the majority of people pirating on their P2P networks couldn’t care less.

    Very interesting blog entry tho.

    I think rabbit probably said it best with “free is better than high quality”.

    Not everyone is a high paid CEO.

    I love my Google Mail, it’s free for me, yet they make money off me with their _UNOBTRUSIVE_ advertising.

    I found the promotion of products in I-Robot interesting… considering we PAID to see the movie, not a converse/audio avert😉 But we will try to make more money thru _any_ avenue, won’t we.

    I don’t think filesize is the solution to piracy. I just don’t see it I’m afraid.

    Comment by Will -

  75. This is my first time on this blog. I really enjoyed the discussion. I think there are some good insights as well as recognition that it is very difficult to change the status quo! Like Mr. Cuban, I enjoy HD content. I think it is truly amazing! What I like the most about the Internet and content on television is that I don’t have to think about it! Sending disks back and forth, going to the store is inconvenient. Although I love HD content, I am still a big fan of instantly available content. I like sitting down at the computer and typing in http://www.espn.com or turning on the TV set and watching the MLS on HDNet. As much as I am an advocate of technology, and as much as I believe Mr. Cuban, that storage will have a revolutionary effect on the video content industry, I believe that the delivery infrastruture is the place where all the action will be! Pushing light-based infrastructure technologies closer to the home is where it is at! The infrastructure industry is every bit as revolutionary as the storage market. Every leap in networking is also exponential! 10Gbps Ethernet ports are coming down in price dramatically. The power of fiber is nearly immeasurable.

    Yes, getting massive pipe to the home is a tough nut to crack, but it is also the ultimate nut! It is going to take a pretty big squirrel to get that nut open! Innovations and entrepreneurs will finally collide to create the right product. One thing is for sure light-based technologies represent the powerful leaps in service. Broadband is where it is at!

    Already broadband hungry countries like South Korea, Japan, and Taiwan are getting 10+Mbps at home! The balance between compression and quality will soon be reached in these countries. Keep your eye on them for what we should be doing.

    Finding ways to integrate the online experience with the television experience is where the big entertainment is. Broadband is the key to exploring this!

    Storage technologies will hopefully make the biggest impact in ‘converged’ appliances. The fight for the living room is heating up. I think Mr. Cuban has some good insights in some of the shortcomings of the Media Center. There is a lot of redundancy right now in the living room. Less is more to me. I would love to be able to have less equipment, rather than more. I wish my television, could be my monitor, and my computer could be my pvr, stereo, fm tuner etc!

    Finally, I would like to add that the gaming industry is exploding as a source of entertainment. I think there will be a ton action here. I became a much larger fan of the NBA after playing NBA Live. This is as close as I’ll ever be to being an NBA owner, and I enjoyed the fun without having the payroll. I think for many, gaming, is becoming a great source of entertainment!

    Comment by Sean -

  76. I like the kios idea. I whole Blockbuster store inside a vending machine. What would happen to the file though, would it self destruct?

    Comment by Kevin -

  77. If it wasnt for DVD backup software I wouldnt own DVDs. Dvds scratch so easily and become unplayable if not pampered, i just hate them. Putting movies onto small harddrives or cartridges like the nintendo 64, would be a great idea. It would also get rid of minute scratches that affect the quality of movies. But I believe Mark has made alot of great points.

    Comment by ramd0g -

  78. Hard drives are expensive and fragile. Flash memory can hold data for only a decade. An ideal system would be cheap, fast, and robust, and capable of reliably storing content permanently.

    Something very similar to a USB2 pendrive or SD card could be made using a conductive polymer such as PEDOT. This is write-once, very much cheaper than flash to produce, and requires less power to read. like flash, it is silent in operation.

    Becasue manufacture and writing are separate processes, each copy could be individually encrypted, watermarked, etc.

    Becasue they would be so cheap, you wouldn’t have to take your hard drive to the airport kiosk, it could burn the content on a blank one.

    Comment by meredith octothorp -

  79. Anyone that says you can download an HD movie over night is full of it. If any of you have ever downloaded a large file you know that your not getting a full 3 meg a second download speed. Any p2p network is run by us people with regular broadband connections and our upload speed isnt 3/6 mb/s its more around 128-256 kb/s. That sounds like its going to take a LONG time to download.

    Comment by John Paul -

  80. On your question to others at speeches… I download HDTV episodes daily. The pirates just re-encode them into xvid files with almost no loss in quality. The file sizes are 350MBs for a 45 minute show. I can fit two HDTV episodes on 1 CD and then watch them on my KiSS DVD player.

    Bigger file sizes aren’t the answer because pirates will simply re-encode them into xvid or divx and then distro them.

    Also, for those of you who think broadband isn’t going to at least double in speed anytime soon… think again. Countries like Sweden and Holland already have optifiber with speeds of 10mbits both ways. Granted, it’s easier to network small countries. But don’t forget about WiMAX or WiFi. WiMAX has the potential for awesome speeds cause you don’t have to lay a lot of cable down. WiMAX already operates at 54mbps+ Don’t be surprised to see 10mbps speeds in 5 years people.

    Comment by Jesse -

  81. I don’t think large file sizes will do a lot to slow down piracy. Right now on the internet, DIVX and DVD images co-exist as the most popular video formats for pirates. Obviously the Divx movies don’t look as good but they’re good enough for most people. We will also eventually see technology such as Fiber to the Curb or Fiber to the House take over and consumer level broadband will see a massive increase in speeds.

    As for VOD, I work at a small cable company that is planning to deploy VOD in the future and I believe it will be a combo of DVR/PVR devices combined with a large data center at our head.

    Comment by Morbo -

  82. I’ve been playing with an EyeTV 500 Firewire Mac-only DTV tuner from El Gato for the last month. It basically saves OTA transport streams to the hard drive based on the schedules at TitanTV and is a really cool device, if a bit over priced.

    One thing you didn’t mention regarding piracy is that if someone wanted to transcode HDTV transport streams into something smaller that could be transferred over the public internet then they better be real patient. It’s possible for me to transcode in close to real time, i.e., a two hour movie takes around two hours to resize and recompress into something that can be exchanged over the net. Most people’s computers aren’t as fast as mine so it’s going to take much longer.

    Processor speeds have hit a small road block that no doubt will be overcome soon enough. But it’s still going to be years before raw recorded compressed HD content can be convenient enough for the average person to want to re-encode it small enough to send to their friends across the country. Personally, I don’t have hours to deal with making stuff smaller for my friends.🙂

    Like all the other things you cite, this too will be worked out, but by then we’ll be talking about much higher resolutions and even better formats. People always use the technology that’s available…

    Dennis

    Comment by Dennis Whiteman -

  83. Except it was in reverse. When Napster first came out it usually took me several hours to download one song, granted, this wasn’t at full bandwidth capacity, but P2P never is. Very few people had cable or dsl…and until high speed internet exploded I never heard anyone even talking about ‘music piracy.’ Once there was the speed, it became widespread (and the RIAA began making all of its noise). I think that if sizes actually do increase beyond bandwidth, the amount of downloading will decrease as well. Though…the one thing I think is missing from consideration in this post is the fact that to a lot of people free is better than high quality. I am just fine with DVD quality movie…so the fact that I can’t get HD quality over the internet wouldn’t matter to me. If no smaller content was available, that would be different, but I think that lower quality or highly compressed content will continue to be available for download even if the standard rises to a very high quality HD picture.

    Comment by Rabbit -

  84. I agree with those that say the common man, which is by far the majority of the population, number one cannot afford what you suggest and secondly, wouldn’t even be able to figure out how it works. I work in the IT industry and what I’ve learned over the years is you have to dumb it down for the common user. I love what you suggest, but reality says it’s too complicated to work.

    How about HDNet becoming the new Blockbuster? HDNet becomes a bank of movies and all you need is cable or satellite TV. Cable and satellite companies currently have pay-for-view channels, but only limited. Why does it have to be limited???

    I wish my satellite provider would offer an interactive system that allows me to browse hundreds of movie titles. I could then find the movie of my choice and watch it on the spot. No needing to drive to blockbuster or wait for the Netflix package in the mail or drive batch to blockbuster before the late fees kick in or return the Netflix movie(s).

    Take your broadcast.com days and compare that to my suggestion. You brought a streamlined audio to the public via the web, PURE GENIUS. Why not bring streamlined video to the public via an HDNet channel with an interacive browser without forcing people to buy new TVs, Media PCs, HDs, PVRs, etc. Each movie would go for $2.99 to view it. How hard could it be?

    If you like my idea, contact me and I’m sure we can work out an arrangement.

    Comment by John -

  85. I completely agree with what you are saying in the article and the future of media is something I’m facinated by. I have strived for the last few years to reach “Media Nirvana” trying every cobination of storage, quality, price, conveniance that I could find and afford to play with. My conclusion was to purchase the now incredibly cheap xbox’s for every room in my house and mod them to solely run Xbox Media Center. This allows any room to connect to a central MediaPC with all music, photos and DVR content. The media PC has front USB2 ports and firewire for easy access to video files or music to go.

    Between portable mp3 players with FM tuners, thumb drives and portable HD space, I no longer have CDs or DVD with me at any time – and it feels great.

    I also agree with your HQ files to stunt piracy. I used to download the occasional movie from a P2P program but, since HDTV and HiRes DVD – I prefer now to wait for quality and purchase it.

    It’s a shame there are not more companies trying to stay ahead of the curve instead of always playing catch-up. As for the future, I see more PDAs being used. These could carry movies, TV News segments, music collection that could dock in your vehicle, cell phone, all personal information – the list goes on.

    Again, thanks for the refreshing article.

    Comment by Joe -

  86. I work in the film industry. My company (Digital Ordnance http://www.digitalordnance.com) sells the Frame Thrwoer, an uncompressed 2k playback system for film and HDTV. It is really designed for use in the post production industry. You can store up to 85 minutes of uncompressed 1920×1080 at 30fps. It hold multiple clips and be shared among a number of users.

    It is amazing what a difference in quality the higher resolution and lack of compression makes in the images. The key is to have a system that can really show you the results. Computer monitors have better resolution than TVs in both color space and pixels. Most CRTs have about 10 bits per component of color resolution and can support 2048×1556 resolution. Projectors are typically lower than that unless you’re droppping a lot of cash.

    Film has a lot more resolution. We’re talking about 6k by 4k with probably 16 bits of descernible color resoluion. Film grain also makes it quite noisy so it isn’t quite the same comparison as video. This is why real film bufs aren’t happy about the conversion to HDTV. It really isn’t up to the same quality. Perhaps 75%, but that’s good enough for most viewers and better than 95% of the display systems.

    Several people mentioned compressed. My uncompressed image streams require 220MB/s. That’s a lot of data to stream over any network or store on most devices. Compression can get you huge savings in space, but the quality really isn’t there. If you’re watching a film on an airplane you may perfer the small size, but what you’re seeing pales in comparison to the original source. If you’ve got the display technology it’s worth the extra bandwidth to show great looking images, but if you don’t you might as well compressed it a lot.

    Comment by Daryll Strauss -

  87. You’ve obviously never given a talk around my cirlce of friends. I have downloaded more than one full quality HD movie–LORT:Return of the King and The Fifth Element. I’ll agree that the availability of such media is much less than DVD rips, however bandwidth is not a completely limiting factor. With my cable modem it takes less than 24 hours to download 18 gigs, and I typically do 4-10 overnight. I think your assumption that larger file sizes will thwart pirating are ill founded.

    Comment by Jason -

  88. “The biggest decision facing HD cable and satellite distributors today is quality vs quantity. Right now most are looking at using compression to squeeze more channels into the existing space they have rather than squeeze a better picture into the same bandwidth that channels take today. The reason it’s a huge decision is that once they decide to fit in more channels, they can’t go back. You can’t all the sudden decide you need 15mbs per channel to deliver a picture that compares to a competitor’s better picture after compressing down to 6or 8mbs per channel.”

    True, but better compression codecs are coming down the pipe and will allow satellite and cable operators to better utilize the bandwidth they have. The real problem is there still is not all that compelling programming on HD. The Olympics are a day late and a dollar short and many HD channels are merely simulcasts of their SD counterparts with little real HD content. Only a few channels, such as HDnet, are dedicated to bringing the viewer the most HDTV programming possible, and even then the channels worth having are not available on every provider (bring HDnet to VOOM Mark!).

    Comment by oscar chen -

  89. We could take advantage of the nightly drop in bandwidth usage in the US. We pay for peak usage during the day and “waste” capacity by not using it at night. What about an On-Demand movie delivery service that pushes movies out to the consumer during off peak hours?

    The main problems facing IP movie delivery are … how can the average person watch it on their TV … and how to digitally protect the movie (DRM) . You spoke about both in your blog, but they must be addressed before this medium will take off as a material business.

    Comment by Justin Madison -

  90. I completely agree with what you are saying in the article and the future of media is something I’m facinated by. I have strived for the last few years to reach “Media Nirvana” trying every cobination of storage, quality, price, conveniance that I could find and afford to play with. My conclusion was to purchase the now incredibly cheap xbox’s for every room in my house and mod them to solely run Xbox Media Center. This allows any room to connect to a central MediaPC with all music, photos and DVR content. The media PC has front USB2 ports and firewire for easy access to video files or music to go.

    Between portable mp3 players with FM tuners, thumb drives and portable HD space, I no longer have CDs or DVD with me at any time – and it feels great.

    I also agree with your HQ files to stunt piracy. I used to download the occasional movie from a P2P program but, since HDTV and HiRes DVD – I prefer now to wait for quality and purchase it.

    It’s a shame there are not more companies trying to stay ahead of the curve instead of always playing catch-up. As for the future, I see more PDAs being used. These could carry movies, TV News segments, music collection that could dock in your vehicle, cell phone, all personal information – the list goes on.

    Again, thanks for the refreshing article.

    Comment by Joe -

  91. Maybe this would be enough incentive.
    TV’s come out with Firwire/USB ports.
    Block Buster sells keychains for $10-20.
    Cheap enough to break and not be a biggie.
    Bring the keychain in put a movie on it.
    Watch it but not have to bring it back.
    Never pay a late fee again.
    Reuse it as many times as you want.

    Comment by Sean Fisher -

  92. All this talk of HD delivery is interesting, but I have a few observations.

    I consider myself mostly on the bleeding edge with regards to technology and live in Anywhere, USA but I don’t know anyone personally who owns an LCD flatscreen TV (could you spare a 55″ one Mark? ha). Or a Tivo. Or a Media Center PC. Heck, I just bought a DVD burner a couple months ago (for home movies and data backup!). Other than myself, I know of only one person that uses WiFi in their house. And only a few that have broadband (but do they do use it for more than e-mail and light surfing?). I have a few friends that own iPods and buy tunes occasionally online. I can’t even say I know many people who spend more than an hour a day online. About the only thing I’ve noticed that is catching on with the average joe I know (other than cell phones) is digital cameras. And few really use them to their potential or know what to do with them.

    My point is that with HD, you’re talking about a very thin slice of the population that is savy enough to take chances on new technology until it is very affordable. The vast, vast majority of average people either can’t afford the latest gadetry, or find it too daunting to use. Perhaps you can support a business with 2-5% of the population (see Apple), but new delivery methods could take decades before adoption levels meet expectations.

    Not only are there new technologies emerging every day, the consumer is bombarded with so many options for content that few can or want to keep up. While I would love to have HD content at my disposal, everyone I know is perfectly satisfied with DVD quality and traditional forms of content.

    From a business aspect, what would HD delivery mean? You would certainly have to charge more for it (either per month or per selection). Or sell more to each of your customers. Why else get into it? I doubt consumers could rapidly increase their monthly digestion of content (heck, I had to cancel my WSJ subscription because I had no time to read more than an article or two daily). Just because I COULD select from 2 gazillion movies on demand, does that mean I’m going to exponentially increase my movie-watching time per month? I doubt it…our lives are too busy and only getting busier.

    Sure it would be great for travellers who want to view a quick movie (besides laptops with DVD’s and hotel PPV), but I think the great majority of the public will only dabble with these things until a clear winner emerges. And guess what? The more fish in the pool, the harder to attract the keeper! Meaning it’s going to be more challenging for consumers to wade through the endless choices in the next five to ten years. Most will stick to what they are familiar with.

    Comment by Howard Wright -

  93. HD Quality TV shows ARE being shared over the internet. Not sure if that was stated in the previous comments, but I’ve seen them on various networks and services. They are big, but lots of people are willing to spend the time to get them to see it in higher quality.

    another statement. the netflix approach to mailing USB/FW memory sticks is a good idea, if only that you can package the devices much more securly then a cheap envelope for the DVD that always breaks.

    Comment by anony. -

  94. Given the current requirements for video streaming (e.g. 15MB/sec for broadcast hi-def) and the current wi-fi speeds (at unrealistic best 100Mb/sec = 12.5MB/s) there’s no way that you’d be able to use wi-fi connectivity to stream clean/clear mid- or hi-defininton feeds to your TV/DVD/etc. without experiencing hiccups. I know that my wi-fi network, albeit a mere 11Mb/sec, gets nowhere near enough throughput to stream video reliably.

    The specialized wireless networks that are available are going to be priced out of range for most all resonable consumers.

    I’m a little concerned with the thought of a movie on something as small and misplacable as a USB dongle, but I think the idea has some very explorable possibilities

    — My 2c worth

    Comment by Chris -

  95. If you have a good usenet news server, checkout alt.binaries.hdtv. HDTV is being shared.

    I believe the best way to combat piracy is to make content available at high quality and at a reasonable price. If that isn’t done, people will copy.

    Comment by Sean Kennedy -

  96. You want to prevent people from copying files that they will always be able to copy faster than you can stop them from doing it.

    Goodluck with your fantasies of corporate control.

    Comment by Corey -

  97. Mark I have some answers to your questions.

    You raise some good points, and ask some good questions. However, there are answers that are already staring you in the face.

    (Let’s look at your questions first)

    # 1. There’s no single answer to this one. I’d say at issue are: piracy, no Sat or PC manufacturer wants to be held liable against a cash cow Congress-lobbying MPAA or RIAA. That’s why Sat & Cable DVR’s are largely crippled so that you can’t offload recorded content, and why even though you have great projects like MythTV which can serve all the purposes you talk about and more easily – few will release hardware to really make it shine (e.g. digital sat or cable decoder card, QAM cards, etc.). Sure, you have an over-the-air HDTV card you can use with it, but be realistic how many people in the US solely survive off of OTA signals? Moreover, Cable/Sat providers like being the ones who handle the decoding, since they can sell you the equipment and make it harder for you to “steal” their signal.

    #2. I’ve seen high end LCD & Plasmas hooked up to ‘media PCs’ showing HD content, but is that really a boon for PC makers? Most TV’s your average-joe would hook a PC up to are likely to have no better inputs than SVideo. While any PC + Monitor could probably easily display HD content these days, that’s not going to sell PC’s. Moreover, joe-consumer is probably less wowed by HD Content than he would be with cool-looking demo, just toss in a Matrix DVD and well dang it LOOKS high tech and futuristic (even if the picture isn’t anything spectacular).

    #3. This decision has been made for YEARS already, they want quantity. TV quality (and not just on a resolution angle) has been plummeting in favour of shoving more crap at the viewer. I doubt carriers like VOOM will survive when people look at how few channels they carry, vs the premium paid. Meanwhile, Cable & Sat will continue to add channels, and not necessarily even much more content (most non-premium cable channels have maybe 8 hours of programming, repeated at least once during the day, and then they have infomercials in the middle of the night. Adding 3-4 channels with the same content as one traditional channel’s worth of content is hardly unusual nowadays). They don’t care about picture quality, and by in large most consumers don’t pay enough attention to care either. Sadly, most consumers don’t even notice the hours wasted on poor content, which has also been suffering. It’s a lose-lose for the consumer, but if their receiver goes up to channel 1000, hey at there’s got to -SOMETHING- to watch, right?

    #4. I don’t know if VOD was ever a good business save for in cable/sat closed loop systems where it’s not -really- on demand, it’s just selectively tuned (e.g. “You are ordering a film 15 minutes after start time? Are you sure” is NOT on DEMAND). Bringing it into terms of an internet like network, non-closed loop…. broadcasting becomes “unicast” as you said regardless of what it is. There are two solutions to this (again, the answers are out there). Either use multicast networks, to send the same content to everyone in the network simultaneously (e.g. http://www.backspace.tv does this), but that requires that your ISP route multicast traffic to you, which most don’t – and it’s still going to hammer your pathetic home DSL/cable connection. Or the other solution is p2p content distribution, which so far only bittorrent has done in a bandwidth maximizing way, such that it becomes closer to a -broadcast- speed. Projects like torrentocracy (combining RSS & torrent feeds with MythTV) are really the best direction for the latter to take. The former solution, of multicasting – is hard to find, even though it could be more effective. But again, that just brings it closer to the closed-loop modality of traditional cable/sat where things aren’t really on DEMAND, you just receive simultaneously with everyone else.

    #4 is really an issue going back to the root of the term BROADCASTING. People don’t really even think about it these days… and for whatever reason, they think fast network connections are the panacea. Most plebs don’t even realize that their 3M/384k cable/DSL is not only pathetically slow, but that by being asynchronous – it cripples the potential for really good workarounds with limited bandwidth (e.g. p2p is crippled severely in asynchronous networks). That said, even with affordable ‘high speed’ networks, the like of which you could build yourself at home (since gigabit switches are now under $100 a pop) and maybe link with your neighbours, or more likely – move to Japan and subscribe to a 100Mbps fiber ISP (e.g. usen.com) for about the same as you’d pay for DSL in the US – the problem is, when dealing with “unicasting” VOD issue you’re talking about, it’s still the same problem. And it’s the same problem even at 10x the speed or more.

    Case in point. The “fastest” file transfer over great network distances (100+km) recently recorded was something like 4Gbps. Wow, that’s incredible raved the news stories – you could transfer a whole DVD (4.7GB) in about 7 seconds! AMAZING. Ok, for the sake of argument, let’s say that this is a full 4.7GB DVD with just two hours of content on it. Now let’s say you want to “broadcast” that to a million people – nothing big, 60 minutes or the simpsons probably get more viewers on a given week, and they’re not even two hours long. Now, assuming your max speed takes you 7 seconds, if you’re unicasting to a million people that’s 7 million seconds. That OVER 80 days.

    How long does it take NBC to broadcast 2 hours of the Olympics to a (again, for the sake of argument, let’s just keep it at the same figure) a million viewer? Gee, two hours!

    Who wins? The high performance point-to-point network? Or the traditional broadcast 1-to-many medium? Does bittorrent solve this problem? Not entirely? Does multicast? A bit better – but none that effectively that I’ve seen. Moreover, it goes back to the closed-loop not really on DEMAND content.

    The answer, looking forward, should be a hybrid. Where most content is still broadcast/multicast – and on DEMAND takes a small portion of the bandwidth and is on demand to many viewers, not just one. This is very similar to the existing closed-loop sat & cable already.

    Looking to some of the other points you raise… you’re COMPLETELY missing the picture on some counts. You’re cost per GB is one.

    You seem to assume that what a consumer pays for a hard drive, and what a consumer pays for a DVD, relative to the consumer’s cost per GB is all that matters. Get real, from a manufacturing point of view – a CD (and DVD) being a pressed disc cost pennies (sometimes less than even one penny) to manufacture. Hard drives (and flash memory I might add) cost substantially more to manufacturer, and the lowest rung (in your example the $10 keyfob, be it 32MB or 2GB whenever we are in time) is often sold to consumers at such prices as a means to clear out warehouses, and not at a profit (I have a friend who designs flash and DRAM and they keep making bigger chips, because only their highest end really break even and make them profits, their lower offerings they want to get rid of ASAP because of the financial drain they are). So, a DVD may be a static 4.7GB, and Let’s say prices “drop” to $10 a new DVD across the board. Do the manufacturers care? No, that’s still $9.50 of profit. Well, of course minus packaging, shipping & handling and marketting, which what might be half? so $5 of profit? How much profit does my friend make on that $10 keyfob? Answer: pennies? Hard drives, (with all their moving parts and prone to failure and so on) are just as bad. Don’t believe me? Go find me a new 5gigabyte IDE drive and you’ll see what I mean, surely you’re $.25/GB price comes into play? NOT.

    Consumer costs are NOT the same as manufacturing costs. Consumers can be sheep and spend t

    Comment by grey -

  98. If anything the compressed movies traded online will have better quality because instead of ripping from DVDs they’ll rip from even higher quality content.

    Comment by A Richardson -

  99. …who don’t give a rat’s a*s about any of this stuff🙂 as a computer/software engineer, i still can’t stand cell phones (don’t own one and have never needed one), i don’t watch enough tv/movies to waste money on a real home entertainment system, i rent maybe 2 or 3 movies a month, buy maybe on average 1 movie a year, have no need for a dvd burner (even the one i have at work collects dust mostly).

    as for movie piracy, the major deal i think is the pack rat mentality of hoarding movies. personally while i can download any movie i want, i don’t, only because the number of movies i would want to see more then once i can count on one hand, and those i went out and bought for very cheap online. why waste my time downloading today’s drivel?

    anyway, i’m probably one of a dying breed of bs-hype-immune humans left. the more people hype things up the more i yawn.

    but heck, give me a 6800gt and a long RPG and i’m drooling😉

    Comment by amdu -

  100. I believe this to be a little pie in the sky. While consumers really want to ability to be able to copy content to recordable media — the industry wants anything but. HD, doubly so. It’s technically possible to put a 200+Mb pipe into people’s homes, but regulations make the cost of doing so high, and the margins demanded by service providers (at least in the US) are rising.

    Media companies are crusading against the ability for consumers to record digital content in ANY form. With copyright legislation augmentations, the leaning towards granting police-like powers to industry groups (BSA, RIAA, MPAA), etc. and the advent of arbitrary length copyright and media company-written IP laws, I don’t see it ever happen.

    What you describe is not only technically feasible today, but where it not for legal issues making various aspects of your suggestions cost-prohibitive or out-right banned, it would probably be the norm.

    Comment by Ronald Dumsfeld -

  101. Back in the early nineties I had a 486 with a 250MB hard drive running over a 28.8 modem. Assuming a transfer rate of 0.25KB/sec (2kbps), that’s a storage to bandwidth ratio of 1:1,000,000 (250,000KB/0.25KB).

    Fast forward to 2004, I have a 150GB drive and a 5mbps cable connection. Assuming a transfer rate of 625KB/sec (600kbps), my storage to bandwidth ratio is now 1:240,000 (150,000,000KB/625KB).

    My example may not be entirely accurate (upstream/downstream differences for example), but I think it serves to at least make a point: bandwidth is in fact keeping up with storage. It is very true that bandwidth increases in a few large steps, while storage grows at a very regular rate, but don’t underestimate the huge interest in higher bandwidth availability for home users.

    So you say: “Yeah, but the infrastructure for the next generation of WAN speeds just isn’t in place yet.”

    Wrong. With Verizon ready to roll out 30mbps DSL in the next few years and Japanese companies pushing 300mbps through cellular phones while driving down the street, WAN links are poised to jump to the next level.

    Piracy is not the problem. Give the people a reason to buy your product and they will. High resolution video? While that’s a good start, it certainly does not provide a sustainable business model. Are you going to increase resolution by 100x or 1000x in the next 10 years? Bandwidth will.

    Trying to fight technology with technology is pointless. You’re wasting your time, money, and effort.

    Carriage makers were put out of business by the automobile, scribes outraged by the printing press, and now media giants fight against the digital age. Only one thing remains the same: technological innovation is always victorious. Only those who change to adhere to the new rules survive.

    Comment by Nathan -

  102. Here’s some more discussion on Mark’s blog for those interested:
    http://slashdot.org/article.pl?sid=04/08/23/1655224

    Comment by J. Robin -

  103. I’ve been downloading HD movies and tv shows recently from HDTV newsgroups. Matrix Reloaded 720 is about 4.5 gigs. LOTR TTT EE 1080 is 18.5 gigs. I’m using an unlimited downloading monthly account.

    Hard drive size growth has been slowing down because they are reaching the areal density limits of platters. storagereview.com has a blurb about this.

    Comment by blah -

  104. They have 100mbps to the home in SK, Japan, throughout Scandinavia.

    We may leapfrog them in the next 2-5 years, imagine port limited gigabit copper from the pole (fed by fibre).

    Over 50% of American net-connected households have broadband.

    Comment by Otis Wildflower -

  105. ESP: By the time you wrote that you capture HD at higher quality than you broadcast, I had jumped to the same conclusion you had about pre-distributing content at night- PREvo, if you will. Kudos for also jumping to what I thought was an obvious conclusion.

    The Public: I don’t see the lack of adequate distribution media as the biggest hindrance to HDTV. Public apathy is a major problem. NBC is _barely_ able to get HD coverage of the Olympics and it only appears to bother those of us with HDTVs. I was the first person in my extended family and friends to buy an HDTV almost 4 years ago. I’m still the only one. As much as I’d like to see new technology and new solutions, I’m skeptical that HD-DVD (flashdrives, cig-pack HDs, etc.) is going to tip the balance either.

    Handwringing: But I’m troubled by the amount of “Who is going to develop the next generation of x?” comments in your blog and responses. Why are next-gen hardware and distribution media/systems someone else’s problem? For example, you write “Why haven’t the Media Center PC companies and the cable and satellite industry gotten together to put set top box capability in mediacenter PCs?” You, more than most people/corporations, have the resources to make a significant contribution. But I’m not telling you something you don’t already know.

    Comment by John -

  106. According to the above information, a typical HD movie that is 2 hours in length would be 18 gigabytes. Given the availability of broadband connections in the US that support either 1.5 megabits/s or 3.0 megabits/s download speeds, you are looking at:

    ~17.5 hours to download at 3.0 megabits/second (~300 kilobytes/second)

    ~35.0 hours to dnowload at 1.5 megabits/second (~150 kilobypes/second)

    The question is ‘Are these times small enough to make piracy an option?’. I believe that the answer is clearly ‘YES’.

    Think about how many P2P download apps work – You select the file you want to download, start the download, and walk away. The application manages retries, dropped peer connections, etc. Given enough time, the download will complete. Even with much smaller music files, consumers are accustomed to working in this manner- select file, begin download, do something else while download completes.

    Given the ‘always on’ features of broadband connectivity and the ability of P2P apps to continue working in the background, I see no reason why files in excess of 18 gigabytes would not be ripe for piracy.

    Heck, local ISPs here in the Bay Area are now starting to roll out 6 megabits/second DSL service, which would drop that download time to 8 hours- a no brainer for an overnight download.

    So although storage capacity-to-cost ratios are improving more quickly than broadband bandwith-to-cost ratios, there is no reason to believe these file sizes will be prohibitive.

    Comment by Jason Buberel -

  107. Download speeds won’t increase signifigantly over the next 20 years. Having done tech support for various forms of broadband services, with some insight into the architecture (It’s good to know if you’re serious about your job, which I am) the problem with the adaptation with faster-than-broadband, has to do with the limits of infrastructure.

    Over phone lines, the speeds do have a theoretical limit. Furthermore, companies have absolutly no incentive to offer more/raise them. Why? Because people are limited to the speeds by the QUALITY of their connection. This is for both cable and DSL. And in certain areas, the quality is VERY lacking.

    To put it simply, someone who’s getting 600 of a 640k connection is happy. Someone who’s getting 800 of a 2000k connection is NOT happy.

    And until that infrastructure is upgraded to allow for higher speeds…which will never happen, you won’t see it.

    Comment by Karmakin -

  108. Sorry, if this was brought up, but I didn’t have time to read everyones responce. But the simple fact remains that it doesn’t matter how huge the source is, it could be 10TB, all you have to do is have one person who gets the source and they just recompress it to an almost-HD or HD quility and it will be the same size as any other movies people download today. New kinds of compression could allow for HD quility in something that is only a few gigs.

    Comment by Matthew -

  109. … I would theorize that Early Adopters (those who would be most interested in HD cable boxes and dishes) are probably the largest constituency of DVR owners. The fact that cable HD doesn’t work fully digitally with DVRs (for a myriad of reasons) is going to hold back HD adoption.

    There is a standard for keying 3rd-party HD receiver equipment to DVR/PCs (not off the top of my head :p), it needs to be used and pushed out so Tivo (or someone else) can come out with a proper fully-digital HD/5.1 DVR that can be used with any digital cable or dish system.

    That’s the rub: those who aren’t into TV watching don’t need HD, those that _are_ into TV hardcore enough to get HD have Tivos. Otherwise you’re hoping to sell into the DVD crowd, and anyone hardcore enough to build a HT with DVD upconversion is gonna have a Tivo to boot.

    Comment by Otis Wildflower -

  110. … Just a quick point or N:

    * I _have_ downloaded seasons of TV shows on broadband. It takes awhile and it’s inconvenient, but it works. I’ve downloaded DVD rips and TV encodes, courtesy of standard P2P stuff as well as Torrents. Torrents can saturate a cable modem depending on the popularity of the series in question.

    * Convenience, special content and quality are key. It’s a PITA to download, even with 3-5Mbps shared, or with a 100Mbps office connection for that matter. Quality of illegal downloads is random, averaging low. To get the DVD ‘experience’ (menus, bonus items, angles, etc) you essentially have to rip a DVD ISO and compress it, which few do, though I have and it works pretty well if you have a 250GB drive or two.

    * Offering a range of content compression (from zero to MPEG4 high) ala Audible is a really neat idea, especially if you have a large enough optical medium to support it.

    * Optical is not dead: it’s better than tape for handling large amounts of static data, especially through snail mail. Fedex next-day with 20 HD-DVDs is pretty impressive bandwidth!

    * Lack of HDTV-enabled Tivo IMHO holds back HDTV somewhat, though upconverted DVDs probably make up for that (and then some).. 480p->720p can be done quite well with even moderately-priced line processors, though there’s no substitute for actual pixels..

    There are things to learn from what Apple has done, though I would add making the store accessible for other content providers (charging rent on the infrastructure, client access, and software) instead of keeping it exclusively Apple.

    Comment by Otis Wildflower -

  111. Keep on working to deliver high quality picture in formats that store a lot of GB and you’ll have me as a consumer. Honestly, once you get to a certain level, it doesn’t matter much. Good luck!

    Comment by NBA Rumors -

  112. I liked the article, a few nitpicks though:

    HDTV on the go is a wonderful concept, however it’s flawed by the cost and usefulness for the average person. On a 7″ screen, HDTV and DVD quality look very similar, certainly not worth the large price increase mobile HDTV screens require.

    Have you seen the flipstart PC? it’s funded by Paul Allen’s vulcan ventures, now that has an “HDTV-quality screen” and a large hard drive. Couple it with proper internet access and your HDTV mobile project sounds very interesting. However, the PC is likely to cost about the same as a mid range laptop $2000. For most people, that is out of the price range.

    Noticed the Slingbox? http://www.slingmedia.com it’ll be in the stores by xmas at around $200, this thing will “place shift” your cable/satellite box. Really it just encodes your signal to a useable bit-rate but it means you can watch live TV on your laptop/PDA and cell phone, well when 3G technology is properly adopted. I’m predicting big things for that, I’ve already found a use for me.

    Since I’m in the UK and don’t get access to a full selection of NBA games (I get maybe 1-2 a week). I’m going to be able to install a slingbox into the datacenter and get them to whip in a directv line. I pay the directv bill and I get home access to all of directv’s programming from another country. The slingbox’s GUI allows me to use a laptop (or a crestron programmable remote) as a long distance remote control. I can even use my home hard drive as a Tivo to schedule recordings.

    I’m with you on the hard drive technology in the home, it has alot of potential but I think it’s up to the cable/satellite companies. Few people actually paid for a standalone Tivo (I think the figure is around 2 million). Directv has launched an HDTV ready tivo box. The 250GB hard drive is nice but $1000? we all know the hard drive costs about $120 and the HDTV circuits are not that obscene.

    One of my ideas is PPV movies on-demand, we’re years away from HDTV on-demand throughout the USA, until a better compression technology is found or a cheaper way to mass install large bandwidth (IE better wireless range and speed). But how about utilizing those HDTV tivo boxes? Basically the movie is sent out multiple times during the day, people can book the movie on their tivo scheduler. The next time the movie is player, the tivo downloads the movie to the hard drive. Then when the user gets home they have an on-demand HDTV movie. I think it’s very basic but I’m sure some people would be interesting in pre-booking a movie for a certain evening’s viewing. Not a great idea but it’s a start.

    I think the technology is slowly getting there, but full VOD and HDTV movies are 18 months away. One thing I do forsee is alot of movie theatre closures, here’s why:
    If HD-DVD is implemented with proper DRM, movie companies will be racing faster to bring out their release to save lsot money from bootleg movie rips.

    Seen the wireless home theater setups? great idea, getting rid of those speaker wires will make alot more people able to use home theater. All you have to do is hook up your S-VHS cable, and perhaps optical out (alot of them have a DVD drive built into 1 unit) and layout your speakers. Not Wilson Audio quality sound, granted but a vast improvement over those built in speakers. All for $350

    Did you read Clive Davis’ rant on music sales and the threat of digital distribution? an interesting piece (quite obvious though) but atleast it didn’t go down the familiar alley of blaming piracy for falling sales.

    I’ve spent the best part of 2 years working on models and prototypes for future digital distribution using home-grade equipment with some interesting results (and failures). If you ever want to chat, you have my email🙂

    Comment by Kanes -

  113. In my opinion the key here is mass adoption by “non-technicals”. If my mother and father can figure out how to reload their portable storage device (Flash, HD, etc) then it might succeed. However, if the HD DVD’s come out and are all over Best Buy then you can bet that Joe Blow consumer that doesn’t know anything about technology (99% of the population) will buy the HD DVD’s.

    I am not too sure that on-demand video is going to be that much of a hit. I would assume that to get this service you would inevitably have to pay for each “download”. I would be fundamentally opposed to paying for this service if I could have already recorded said content when it was originally broadcast to me. However, those of us with HD Tivo’s (HR10-250’s) would love to see more HD content. I would definately sign up for a service that would download HD content during off hours so that I could watch in prime time. Things like Discovery Wings, Science channel, etc that lend themselves well to HD but aren’t currently available in HD format. I just don’t want to pay extra for EVERY extra HD show I grab. I would consider a monthly fee. So, offer high quality (HD) content for off hour downloading and then regular content under the standard $$$/mo subscription.

    Another issue is advertising support of television. Why would any media company that makes a living selling advertising support content distribution methods that make it easy for consumers to skip commercials? If everyone had a Tivo (and who the heck watches non-superbowl commercials if you have one?) why would you pay to put an ad on TV if you were a business?

    Hey Mark,

    I am surprised that your portable USB 2.0 HD wouldn’t keep up with the HD content. Even if you were pulling 15Mbit/sec or so (more or less) you should have no problems. It sounds like XP was using the USB 1.1 driver for that port. Keep in mind that pre XP SP1 USB 2.0 wasn’t supported. I am sure you are post SP1. BUT – if you didn’t RE-DETECT hardware after installing SP1 then you are probably using the pre SP1 USB 1.1 driver. This has happened to me numerous times in the past.

    Rick Smith

    Comment by Rsmith -

  114. Mark,

    Excellent thought all the way around and the portibility of HDTV broadcasts is the most important thing going on in the living room today.

    I’ve written a little about this in the past with two articles on my blog 1. 10 Things That Microsoft and Tivo each Must do to Win the Living Room http://thomashawk.com/2004/08/top-10-things-that-microsoft-and-tivo.html and 2. My little Hughes HR10-250 Tivo HDTV vs. Microsoft’s Media Center Edition Review http://thomashawk.com/2004/07/my-little-hughes-hr10-250-tivo-hdtv-vs.html.

    Both of these articles deal with HDTV and the portibility issues. I agree with you on Microsoft unbeliveably tripping over the opportunity to push and promote HDTV with their Media Center boxes. Microsoft has blown a major opportunity here and continue to do so by not addressing HDTV.

    Great read and thanks for the write up.

    Comment by Thomas Hawk -

  115. You don’t seem to acknowledge the reliability/durability factor when comparing DVDs and hard drives. Hard drives have moving parts and are prone to failure. Nobody uses a single hard drive to store content they care about. They either copy it to a more durable media, or have redundant hard drives.

    Also, I don’t buy the argument that bigger file sizes will kill piracy. A typical CD audio disc holds about 600MB of data, yet Napster took off because people were exchanging that data in 60MB. Yes, there was some loss of quality, but the piracy still happened.
    When people that are willing to pirate are faced with the question: should I pay for this movie so I can watch it in its full HD glory? or should I just download a free compressed copy, with the full contents of the movie, but at a lower quality? Guess what the answer is, every time?
    Having the best quality is not important to this audience. The only people that care about having the absolute best quality are the people that shell out the bucks to buy the best home theater system to impress their friends. Those are the people that will pay for quality media, instead of the compressed pirated version. But the other audience, that doesn’t buy the top of the line equipment and just wants to watch the movie? Piracy doesn’t go away.

    Comment by Joshua Flanagan -

  116. download speeds will not be increasing in the future. if you look at the numbers, not many households actually have broadband connections
    (23% in 2002 according to http://www.clickz.com/stats/markets/broadband/article.php/10099_1580601).

    you still see ads for AOL and netzero… would they still be in business if people didn’t use dialup anymore?

    of the households that have broadband (cable, DSL), the great majority is probably satisfied with their download speeds. after all, most people just use internet to browse pages and not to download content. thus, offering even more bandwidth would only appeal to a very niche market of extreme nerds (such as myself).

    no demand, no faster internet.

    Comment by larry -

  117. I’ve heard about your weblog but until now have just passed it off as yet just another blog. However, I now will log on (and comment) often. The DVD vs. larger Media is something I had never thought about comparing. Keep up the challenge to conventional wisdom. BTW, care to share the encoder you used?? I’d love to try it.
    ~GEM

    Comment by GEM -

  118. Mark,

    “Do you see upload and download speeds increasing 10x in the next couple years? I dont…”

    I do, because the consumers will demand it. Never mind the fact that 100Mb fiber is already available outside the US – the early adopters of broadband stateside were by and large warez junkies who wanted the high speeds so they could download more stuff (or so my experience has gone – the first people I knew who got cable modems were actively trading software and MP3s 7 years ago).

    I don’t think it’ll be long before someone offers 100Mb fiber here. Sure, the price will be steep, but early adopters will probably have little problem dishing out the money. A few years later, technology will allow the price to come down enough that your average Joe will be able to afford it, and content providers will start taking advantage of it.

    Comment by voyage35 -

  119. Same thing in Scandinavia, where 100MBps Fiber to your house is a reality already. Being a TiVo-fan and living here in the US, I rarely watch live content (except for sports), so if I could order a whole season of a show in HD and have it downloaded over a couple of nights, I’d go for it. My main problem is storage of the content I own. I.e. DVDs. I’ve run out of shelfspace for DVDs so I need that TB drive soon!🙂

    Comment by Magnus -

  120. I’ve always leaned towards HD based solutions for things like this. I LOVE my Archose 20gb MP3 player. They run under $100 on eBay and do almost anything you would need an MP3 player to do. Good cheap media PC’s DO exist, but you have to make’em yourself. Modded Xbox’s with monster HD’s added make terrific media PC’s that will do damn near everything you’re talking about. Audio, video and gaming in one, sub $400 package will all the audio video compatibility hook ups you could require.

    Comment by Scott Griffith -

  121. By the way.. I loved the Wifi comments..
    WIFI is the way of the future.. build a long-term strategy around wifi and you will win..

    If i had my pick i would center around WIFI and VOIP.

    Comment by Mike Verinder -

  122. Sorry I phased out reading the rest of your blog on this after you said Key chain usb’s were easier to carry than DVD’s…
    What are you smoking anyway? Disks are small and flat.. and reliable.

    Comment by Mike Verinder -

  123. I live in Tokyo where you can get 100MBps Fiber to the Home (FTTH) for about $55/month. Installation is pretty easy and the performance is incredible. It’s been around for about a year and a half and isn’t limited to just the metropolitan areas.

    The implications for this are that you can download a movie between the quality of VHS and DVD (using WMV or Divx) in <10 minutes with DVD quality within a half an hour. A raw DVD rip could be had in a couple hours. This would have huge piracy implications for DVDs. As a result the studios would be forced to either go higher def or ITunes style moderate cost+DRM.

    As far as the hard disk goes, I'd go ultra wide band wireless for the kiosk idea. Imagine just getting your laptop close to the kiosk and having a movie donwloaded in a 30 seconds. If you could get public libraries to do the same thing for documentaries and other hi-def where you just bring in your computer and download them for a period, it'd probably get people to start understanding the concept.

    Comment by Chris Yu -

  124. But you aren’t paying attention to the pricing of flashdrives. You can buy 32 mb flashdrives for under 10 dollars. Soon those will be 256mb, and then 512mbs flash drives for under 10 dollars.

    Then it becomes an easy physical replacement., and there is a physical , cost and flexilbility reason to change mediums

    One of the reasons I did the test of a flashdrie with a movie is to see about ease of use.. Take my word, the flashdrive is far, far easier. Plug it into your USB port and watch. Never skips, never scratches, its reusable for storage if you are done with the move, and its far smaller than a DVD…..

    And as far as bigger hard drives. They are less than cig packs now. Smaller, but thicker than a DVD in size. They will only get smaller and are getting faster

    Its going to happen, just a case of when and by who

    m

    Comment by Mark Cuban -

  125. I saw at least one software that will be distributed on HD soonish:

    http://vsl.co.at/english/pages/products_%26_shop/symphonic_cube/symphonic_cube.htm

    because of size (will be north of 500 GB last I heard).

    Not really low cost video stuff you pass around though, at $5000 plus a pop you can afford to throw in a $200 drive or 2. But it’s always the extreme stuff pushing the envelope first. Drop the HD price and make it less fragile (dropping one on the floor is no good at the moment), and ya, it’s doable imho, if no other technology betters it in the mean time.

    Comment by Pat -

  126. After thinking some more, I don’t see the kiosk options as likley. Do we not already have the technology to meet HDTV needs?

    In the UK, Sky satellite TV provides around 100 channels. Now that seems like plenty of capicity to include some HDTV content. What is the bandwidth requirements for good HDTV? I am guessing but maybe 4-6 times a standard definition.

    It appear to me that the future problems for TV/Movie does not seem to be picture quality or quantity of programs, but instead ‘how do I (the end-user) find the content I will enjoy, in the mass that is getting produced.

    There are more movies being produced then I can ever watch, more books written than I can ever read, more music created then I can ever listen to.

    We should be thinking about intergrating into PVR/TIVOs a system to recommend viewing to me. My friends/reviewer/.. could recommend content which gets placed on the Internet (in RSS feeds?) and I subscribe these feeds and my PVR determines and recommends viewing. Alomst the reverse of Spam filtering.

    Comment by TommyA -

  127. Airport kiosks sound like a good idea, but most people have a patience span of about 15 seconds in an airport, and a few minutes would be unbearable. If you could readjust people’s patience for your kiosk, then I think you’ve got something.

    Comment by Kathleen -

  128. Really thought-provoking post. Thanks. In regards to the limitations of DVD or disc based storage, however…

    I am curious as to what format movie theaters use when showing movies in digital projection. It seems like that format would have to have some serious storage/capabilities and I have been impressed with the viewing experience.

    Another option would be holographic storage. A company called InPhase Technologies is working on holographic technology that can hold 250GBs on a DVD sized disc. I have also read reports that it could be used in hard drives as well. If you haven’t heard about this, the most precise information I have found is at their website:

    http://www.inphase-technologies.com/technology

    Although I could have sworn I read about other companies in the race as well.

    Groovy,
    JtK

    Comment by Jason T. Kocher -

  129. I’d just like to note that you are one of my heros, for real. The idea of HD VOD is right on the money. I like that idea more than an external hard drive Netflix option. Also, airport vending of USB HD movies is a smooth idea. Not all laptops have DVD players… but they all have USB.

    Christopher

    Comment by Christopher Harbin -

  130. Every media has had to deal with the question of quality vs. quantity, and the winner is always content. LaserDisc players where all about quality, but they never took off against the VHS standard because content was all in VHS. You see it everywhere in the video game industry. No one cares who has the better games, only which platform has more games. Mac vs. PC. Didnt matter if the Mac was a better machine, only who could run more software. Palm dominated the handheld industry because of the quantity of software made for it. Consumers dont care about quality, only quantity. Its about choice. The same is true of every media: Music, TV, Video, Games, Movies…Just a thought, but it seems to me that super quality tv has a place in the ultra-luxury market. For the rest of the world, its all about choice, channels, and more choice. Which is why I think cable companies will use the extra bandwith to give consumers more options and the super quality stuff will go the way of the laser disc, to the graveyard of mass market products – to the homes of those who care about quality more then quantity.

    Comment by E Port -

  131. Not to open a can of worms…but.

    I think it will be interesting to watch how commercials and distributers will impact all of this. The cost of Television has always been off set by companies who wished to put there message infront of viewers or companies who charge via subscriptions.

    The technology will move as fast as people are willing to let it. If people will pay for it then it will happen. People will pay for movies and HBO is proving that people will pay for drama and comedy shows. But all of what you talked about Mark is very costly for most of the population.

    Just a thought but if a company who had the media content decided rather than broadcast they would deliver it directly. Content could be sent via media storage devices and if you so desired the entire season of a show could be “on demand.”

    To offset the cost of storage devices advertising could be embedded into the content, Thus creating a revenue stream for the distributer and thus keeping the cost down for the end user.

    PVR’s are gaining popularity because 1. they are great. But more importantly 2. Directv and others were willing to give them away to sign up customers.

    If a company who distibuted conetent via media storage devices gave people who signed up the neccessary equipment and was able to keep the price of the media down. I think that broadcasting as we know it may change.

    Comment by Jerome -

  132. The underlying basis for this article is simply HD quality, and hence file size, is constrained by media type. Right now DVD is the media in vogue, but soon it will be either HD-DVD or Blue-Ray. What Mark is saying is why jump from one constraint to another temporary constraint; we should switch to media that has no boundaries and thus can achieve maximum qualtiy & user satisfaction. In theory its a good idea, but in practice it fails in many places.

    First off, the ideal distribution of content is network delivery, but as Mark touches on, bandwidth will not increase to the point where HD+ quality content is feasible over the public internet any time soon.

    Second best is distribution via media, and with that we have a couple of choices: DVD/HD-DVD/Blueray, hard drives, or solid state memory. Of all these, Mark says we should forget about the DVD and its cousins and should instead switch to hard drives and flash drives.

    Hard drives are bulky and its laughable to think people will be mailing these a la netflix. If the mail is lost, what would you rather lose, a $15 piece of plastic or $150 hard drive?! Other approaches like kiosk refills etc. could be an option, but that doesn’t replace disk-media by a long shot, just a niche service in airports. Also, the interconnect matters as the bus speed can make or break viewing quality. As he says, USB wasn’t up to par, but firewire worked well.
    Flash drives can be seen as hard drives without the bulk and mechanical issues, but it’s far more costly per mb.

    Compare this with simple DVDs (and HD/blueray). They are cheap pieces of round plastic, easily manufactured, easily consumed. People understand the process: buy disk, put disk in player, enjoy. They don’t need to learn about bus speeds, compression formats, connecting PC’s to the tv, etc.

    Right now it’s frustrating for entrepreneurs and geeks alike because we have all this content in digital form and a global internetwork for exchanging digital content just teasing us to develop a better solution yet we’re stuck with trading these little plastic disks. But these plastic it is going to stay until enough bandwidth or revolutionary compression gives us the golden delivery network.

    Comment by Haig Shahinian -

  133. I agree with the Wi-fi comment,as we move to low-cost high speed wireless ethernet networks the need for static storage devices is reduced and replaced by internet storage.

    Comment by scott -

  134. This is a very complex and tough question to answer. There are three
    ways that I look at the challenge.

    You can’t give everyone bandwith? But can you give everyone compression?

    First convetional thinking tells us over the next few years the technology for
    storage will improve greatly. I think that
    the bumps on DVD will be smaller and closer together. Nano solutions are a little bit around the corner; therefore, I won’t even take a stab at some of the new ideas that are currently out there, or might surface.

    We will definitely see someone make a ton of cash creating a more efficient compression algorithm. I am also quite sure that
    polycarbonate plastic will be a thing of the past because of nano technology.

    Another conventional method would be the continued expansion of bandwith
    and lower pricing. Just as TV is free, bandwith will some day be free? I don’t see that really happening in the near future. It makes more sense. There are a number of challenges.

    But, I’ve learned never to say never. It’s a question of how to get Rolla Huff and gang to give it away free? Not gonna happen…

    I think the ordering of movies on hard drives is a little to complex for today’s audience. People tend to view films as a spontaneous action.

    Comment by slw1234@sbcglobal.net -

  135. I suspect WiFi will become the future for interconnection of all local devices. You have your Wifi equiped television/player (in fact WiFi DVD players are already available and can stream data off Wifi networks).

    We already have 4GB of storage in something small like the mini iPod, so it’s not difficult to imagine similar storage sizes appearing on mobile phones/pdas.

    So how about:

    You go to your local movie provider (movie kiosk, super market, Blockbusters..) with you mobile phone/pda, connect to their WiFi network, browse their movies, download to you phone/pda.

    Watch your movie on your pda if you are on the move (and have good eyesight), or take it home and have your TV stream it off your phone.

    Billing could be tied into your phone bill.

    Comment by TommyA -

  136. One of many elements of misinformation from the media companies is that upload and download speed will keep up with filesizes. .They havent.
    We have gone from VHS to DVD and now HD. Even compressed using Windows Media, DIvX , Mpeg4, whatever, will only push to bigger filesizes.
    A compressed DVD 2hour movie can be 900mbs, give or take. A compressed HD 2 hr movie at only Mpeg2/ATSC/1080i equivalency is about 9 GBS, at the low end.
    Thats 10x.. Do you see upload and download speeds increasing 10x in the next couple years? I dont…

    Then not too far beyond that, good content provides will provide lossless uncompressed, and thats at least 30gbs for the same movie….

    Do you see upload/download increasing 30x in the next few years ?

    I dont

    Comment by Mark Cuban -

  137. Great post. Many thanks.

    Comment by soccer4ever -

  138. Mark, your comments on the growth of HD resulting in the end to piracy seem a bit over simplified. Your argument is based on current download speeds and technology, namely that piracy will cease to be a problem because files will become so large that the time it takes to down/upload them will serve as its own buffer to piracy. Why do you think that the technology affecting the speed off downloading and uploading will not keep pace with other new technology. I don’t know the actual technical limits ,if such things exist, but it seems to me that the growth in use of hard drives as a media container would lead to a cooresponding growth in piracy. Namely that as people have more access to media and greater ease of use, they will be able to share it more easily.

    Anyways that’s my two cents. On a side note I think your Airport kiosk idea is brilliant. I know I would definitely stop and download a movie every time I flew if such a service was available.

    Comment by alex -

  139. You make a lot of sense, but DVD’s are pretty and shiny! On top of that Blue Laser sounds very cool. How are HD’s gonna beat that?

    Comment by Peter Broen -

  140. Great post, back in 2004 and even now. But a lot has happened since Mark wrote his post. Mark mentioned that he doesn’t believe the network can handle the download of a 2-hour HD movies, few, if anyone actually used P2P to download large movies.

    Well, some startups are trying this in a legit way. Dovetail http://www.dovetail.tv allows you to peruse a bunch of content, select the ones you want like netflix, but instead of a disc or harddrive showing up in 2-3 days, the stuff shows up on your harddrive the next morning. At 8 mps, you can download a few of 2-hour HD movies — at least more than you can watch in one evening. Akimbo is doing the a similar thing but sells a PVR to make it easier for users to start doing it (but also creating a barrier because they want users to pay for an experimental product — tough sell IMHO)

    These startups don’t have great content and, in the case of Dovetail TV, it takes a geek step to connect the PC’s to the TV’s, but it does show that the stuff can be distributed via broadband, not just on hard drives and plastic discs.

    If these startups fail, it’ll be bacause of the lack of quality content (studios won’t let it out) and rigid viewing habits, not because of network or technology limitations.

    Comment by Jim Chu -

  141. One thing you didn’t mention regarding piracy is that if someone wanted to transcode HDTV transport streams into something smaller that could be transferred over the public internet then they better be real patient. It’s possible for me to transcode in close to real time, i.e., a two hour movie takes around two hours to resize and recompress into something that can be exchanged over the net.

    Comment by runescape money -

  142. As much as I am an advocate of technology, and as much as I believe Mr. Cuban, that storage will have a revolutionary effect on the video content industry, I believe that the delivery infrastruture is the place where all the action will be! Pushing light-based infrastructure technologies closer to the home is where it is at! The infrastructure industry is every bit as revolutionary as the storage market.

    Comment by wow powerleveling -

  143. A) HDTV content IMHO blows at the moment, by now all DTV should be HD, considering what consumers have already shelled out.

    B)Making prople lug around USB drives or worse HD’s, instead of HDNET payng for bandwidth blows.

    D) Why fill landfills full of Flash drives like cell phones when you can just set the DTV box to download UNCOMPRESSED HD content and view it when complete. No need for excessive compression, can use existing bandwidth, and less image loss due to the compression. Faster than Netflix..

    E)I bought all the expensive HD equipment… WHERE’S THE CONTENT MARK?

    Comment by jh dfgd -

  144. Verizon FIOS just reached my neighborhood promising download speeds up to 2mb to 30mb per sec.. i’d say download speeds are cathing up

    Comment by Roby -

  145. I haven’t seen a HD-image, and I fear I won’t for some time. But my LCD-screen support HD, and my Nokia N90-mobile have an incredible clarity (many dots pr inch – anyway). Soo. I guess I might now HD when it gets here. Why should i change to HD when even the local TV-salespersons chose to feed their 52″ HDTVs with composite cartoon dvd-images? They look crap, even worse than on an old 32″ CRT without HD, hooked too VCR’s.

    I think that no one care about HD-quality, just the technology. I don’t think better TV-images will come for severeal years. The resolution will grow, sure, but so will the rate of compression. And 52″ blocking, colornoise and interlacing will be really awfull. It took DVD near six years to produce a prestine DVD, and it will take just as long to produce a HD-DVD or BlueRay-disc. Hollywood just want our money, and most people will buy the movie to see it, not to experience better quality.

    BUT! If someone was able to install a nicely designed 3.5″-harddrive on the wall like a ISDN-modem near the xDSL-box or poweroutlet in my house/or installed into a slot in my TV/any TV, with a link (wifi or cable), directly into my TV-set, that was supported by the TV’s remote, allowing me to surf and preorder HD-programing (movies, TV-shows, Music – a heck games even), with extreme ease, delivered (downloaded without a sound, during the night fully automatic – I don’t care how long it takes, since it happens in the background) at the same day the software was released (like movies on DVD/a show would play on TV), for a fair price, then I would gladely pay for it. Heck, trow in any kind of protection. Lock it with a 3.5″ inch key and toss it in the river.

    The only condition: That a second/third/fourth, etc. drive – of any capacity – and nice design. Could hook up to the first and download a copy – only playable in conjunction with the main drive – allowing one to delete/have a spare copy of the downloaded content.

    I want things fast, cheap, and I don’t wanna fill my house with junk like covers and crap. And I wanna play it when i feel like it. That is entertainment.

    Comment by Johnny -

  146. Any comments on hard disk driver and flash memory USB?

    Comment by Linda -

  147. Also whats with all the talk of High Definition DVD’s being limited to 1280×720, Surely 1920 x 1080 is what we should be aiming for.

    Ben Hobbs
    http://www.h3-digital.com

    Comment by Ben Hobbs -

  148. I personally dont see why DVD’s arent being entirely skipped for the next generation, We already have 4Gb Memory Cards, 32GB’s will probably be available in the next 2-3 years, then all HD movies can be stored on a memory card.

    If you produced millions of memory cards in place of DVD’s the price would come down to significantly less than that of DVD Media. Its transportable, re-writable and you could store your whole 500 film movie collection in a 10 inch square box. Memory cards dont get scratched, High Definition DVD’s are going to be very delicate.

    Instead of renting a film, you could go down to blockbusters, put your memory card into a kiosk, choose your movie – Write it to the card and be om your way. You could even automate it all with an ATM like credit card facility at the Kiosk.

    Ben Hobbs
    http://www.h3-digital.com

    Comment by Ben Hobbs -

  149. I want to extend you a very heart felt thank you..

    Comment by Britney Spears -

  150. I think it is great taht you were able to encode the movies into a little flash drive. Although you could have just ripped the DVD to your laptop🙂

    Comment by Invoice Factoring Group -

  151. One point to my previous comment. I don’t mean to imply that throughput will come from wireline networks (though it is a very likely candidate). There are wireless technologies that may eventually have the throughput to support full tranfer of very large content w/o need of DVD/etc.

    Comment by Marco -

  152. INHO, the best way to deliver content will be through networks rather than devices (DVD’s, etc). Of course, we need to get the throughput per household up to a reasonable level.

    But it is getting up there.

    Comment by Marco -

  153. INHO, the best way to deliver content will be through networks rather than devices (DVD’s, etc). Of course, we need to get the throughput per household up to a reasonable level.

    But it is getting up there.

    Comment by Marco -

  154. I keep finding these gems of yours where you do a massive mind dump on megatrends. Lots of VCs link off of your blog. It makes me very excited to be starting my career at a VC in the internet and software space. I’d like to send you some of my private thoughts on some other mega-trends you haven’t evaluated publicly yet.

    Comment by Brad -

  155. Interesting article, but it leaves a lot of questions unanswered. Still, it is conceivable that it could play out like this…

    http://lcdtelevisionreview.blogspot.com

    Comment by Frank Martin -

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    Comment by vod -

  157. Great article always wanted to know more about what HD DVDs will be like! Many thanks for the post.

    Comment by Jessica -

  158. Great article always wanted to know more about what HD DVDs will be like! Many thanks for the post.

    Comment by Jessica -

  159. Cdrdvdrmedia.com (http://www.cdrdvdrmedia.com) – Online store for DVD Media, CD Media, Blank DVD Media, and other computer accessories.

    Comment by DVD Media -

  160. The availability of reasonably priced licensed content is the key to reducing piracy. I said this to Jack Valente in the early days of home video, and we have seen the changes wrought by 99-cent song downloads. Most people don’t WANT ot steal, they download illegally because they have no other source.

    As to file size being a restriction on downloading, we produce in 1080p (yes progressive) and distribute (adult) movies as standard DVD resolution .ISO files and WMV 1380 X 720i with 1920 X 1080 coming soon.

    It’s not like you have to sit there turning a little crank while a movie downloads, with a modern download manager you “set it and forget it.”

    Comment by John -zeke- Brumage -

  161. The availability of reasonably priced licensed content is the key to reducing piracy. I said this to Jack Valente in the early days of home video, and we have seen the changes wrought by 99-cent song downloads. Most people don’t WANT ot steal, they download illegally because they have no other source.

    As to file size being a restriction on downloading, we produce in 1080p (yes progressive) and distribute (adult) movies as standard DVD resolution .ISO files and WMV 1380 X 720i with 1920 X 1080 coming soon.

    It’s not like you have to sit there turning a little crank while a movie downloads, with a modern download manager you “set it and forget it.”

    Comment by John -zeke- Brumage -

  162. Why dont people sell HD movies online that way it is much cheaper because you dont have to pay for transportation and dont have to pay the fee to people who work in blockbuster.

    It does not take long to download a HD movie which is 20 gigs. In my case it takes only 2 days. I just leave it al night to download for 10 hours.

    A Lot of website do offer to download movies which is legal for 19.95 a year which is a hell of a price.

    Comment by apple -

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