An industry practitioner speaks

In a series of Q&As, professionals in all facets of the packaged media industry share their views of things past, present and yet to come. It’s the turn of MATHEW GILLIAT-SMITH, CEO of Fortium Technologies, a leading provider of copy protection and fingerprint identification software for the film, entertainment and broadcast industries, based in the UK.

DVD celebrated its 10th anniversary last year. How many more years are we going to see DVD around? Are there lessons in the development of DVD that could/should be applied to Blu-ray?

The launch of Blu-ray has coincided with the worst economic downturn in memory which means mass market consumers won’t be spending on non-essential items for a while. That said I am surprised by the number of people I know, mainly in the US, who already have BD players. Compared to VHS, the renting versus owning aspect makes the Blu-ray transition easier. And you can play both DVD and BD formats on the new player.

Is the jump in quality as great between VHS and DVD as between DVD and Blu-ray? Maybe the lesson learnt is a better education to the consumer about precisely what cinematography aspects are better in Blu-ray. Making Blu-ray available on planes and trains will help capture the public interest. It remains that DVD has a long way to go before it is replaced, and when it is, it may not be replaced just by Blu-ray.

Do you think Blu-ray discs will eventually replace completely DVDs or will they only partially replace them, becoming a niche, albeit big?

Early predictions about the growth of the new digital formats were that they would be fragmented according to consumer demand and habit. Media coverage is currently all about 3D rather than Blu-ray and how it’s now come of age. I think the predictions will prove right. Blu-ray will become a predominant format, but not for three or four years, and there will be other new technologies that will rival Blu-ray.

In providing anti-rip copy protection, we work closely with many of the studios. Blu-ray for pre-release does not seem to be a major requirement right now. The existing battleground seems to be still firmly pointing at the gaming platforms like Playstation3 and Xbox for hearts and minds.

Enthusiasts may replace their DVD libraries but many I suspect will not. Piracy is also a factor and consuming movies on line is surely going to grow when bandwidth increases across the board.

The rapid fall in price of Blu-ray discs, so early in their commercialisation, makes the economics of BD authoring and replication very challenging especially given the heavy investment required. What needs to happen to make it a viable, long-term business for independents?

We hear regularly from customers that licensing costs make Blu-ray untouchable for independent filmmakers and it’s the same story for the smaller disc manufacturers. Even for the main manufacturers production costs are expensive with high spoilage rates. For wider adoption they need a model that works for small and large licensees. The ROI for Blu-ray investors will not be quick, but the wider the adoption the quicker it will be.

Interactivity and BD-Live, in particular, are Blu-ray’s key unique selling propositions. Do you think enough publishers will commit extra production resources to spread its usage? Which feature do you think may become a killer app? Or will consumers be mostly interested in no-frill ‘vanilla’ film-only – and cheaper – BD discs?

If you were to ask people what BD-Live is I doubt many would know. It remains to be seen what the push will be to educate the public about these features, but one wonders how many people really watch the extra bits on a typical DVD. Consumer research says it’s not as many as one would think. So, it’s up to the producers of the content to convince consumers that BD-Live is an important part of the show which is something that was never convincingly done for DVD.

It is said that diversification is the best way of staying afloat in the face of market uncertainty. How to you see your company’s range of services evolving over the next 2 to 5 years? And do you see opportunities, if any?

We are celebrating our tenth year and if we hadn’t diversified we probably wouldn’t still be here. As a software developer you need to have your finger firmly on the pulse of upcoming consumer trends and the vulnerabilities that come with them. The challenge is to spot them far enough in advance so you can develop new solutions and commercialise them before the market has moved on.

DVD copy protection continues to be in demand and not just for the film industry. We are developing BD-R anti rip for which currently there is no other solution. Flash Memory and data protection is tempting, but we are trying to figure out the real demand. Our file emulation product is doing well and will be developed further as more content becomes file-based. Our image and video finger-printing is already used for mobile phone content filtering, but this is an example of an already crowded market place.

Contact: www.fortiumtech.com
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