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CEA Forum Addresses Digital Content Issues

Digital entertainment content, access to it and its portability were the main topics of conversation during two Consumer Electronics Association (CEA) Industry Forum events last week at the Hotel Del Coronado, here.

Barney Wragg, global head of digital for EMI Music and the keynote speaker at lunch, was instrumental in this spring’s announcement by the label to launch premium high-fidelity DRM-free downloads.

Opening with a slide that he said many believe is true, “The music business is dead.” Wragg began to prove that statement wrong by saying today is “the most vibrant time for music since the beginning of recorded music.”

He illustrated his own use of music saying that unlike during the days of vinyl LPs and cassette tapes thanks to MP3 downloads “my music is with me all the time … consumers are more passionate about music now than they have ever been.”

Wragg said the music business is now a vibrant place, but for the industry to make money it must focus on the consumer, a statement that would be echoed by panelists later in the afternoon. He noted that soon 65 percent of all cellphones will be music players” and it is easily credible to see “100 percent of all cellphones” being music players.

EMI operates Web sites for its artists, some of whom use social networking to “engage with fans,” provide samples of new music and carry ads. The advertising angle is not new, “since that’s how MTV was founded.”

He stressed that his “three-step test” to show if a new business model works would be: “Does it provide value for the money; is there a good product offering; and is it easy to use?” Ease of use in downloading music and hardware operation, as well as “responding to consumers’ demands,” are keys to success for Wragg.

Those points cropped up during a session called “Content Access and Portability: You CAN Always Get What You Want!” Well, not quite. At least that’s the sense one could get listening to panelists Joe Cantwell, marketing VP/advanced services of Starz Entertainment; Mike Fidler, CEO of Digeo; Buno Pati, co-founder/CEO of Building B; and Daniel Simpkins, founder/CEO of Hillcrest Laboratories. These four top executives provided a varied and, well, complex view of the challenges before moving video content from the home to mobile devices and back will be seamless.

Cantwell said Starz’s experience online has been that 20 percent of movie titles drives 70 percent of its downloads and the behavior for its users, mostly male in the past 60 months of offering online movies with Starz Ticket and Vongo has been to “watch the movie immediately.”

That’s straightforward. But how will this be delivered in the near future? Hillcrest’s Simpkins argues that you “have to bring the mouse to the living room” due to the literally thousands of channels — cable, satellite and online, as well as music and digital images — that consumers want to manage at home and on the road.

Digeo’s Fidler explained his company has been in business for seven years serving 440,000 users and he said, “Consumers like simplicity and don’t like complexity,” and for any technology to succeed in this area, “We must keep it simple.”

Pati of Building B agreed that “simplicity is the key to the mobile [content] solution” but that while you could show any type of content on a mobile device, “probably news and sports would be more popular than a cooking show.”

Simpkins said there will be “plenty of platforms” to move digital entertainment around the home and to mobile devices unlike the way Microsoft has dominated the PC world.

The lack of cooperation of the cable industry with CableCARD has been one ongoing stumbling block, and a turn by younger consumers to go to the web for entertainment content avoid the cable, satellite and telco companies that provide traditional TV shows are challenges.

Based on the opinions and issues raised by this panel, the future of networked video around the home, to mobile devices from the Web and traditional video entertainment sources, and the desire by consumers to customize their entertainment choices, the challenges are for seamless digital content in the near future seem quite formidable.