With the Blu-ray Disc specification now six years old, just how has the authoring world fared with the brief skirmish that was the format war and the slow but steady adoption of the new technology. Jody Raynsford asks authoring houses how they are using the lessons learned to broaden their offerings to new technologies such as digital copy and UltraViolet.
It took its time coming but Blu-ray has finally started to generate significant revenue for a home entertainment business desperately in need of growth. Since the Blu-ray Disc specification was finalized in 2006, authoring houses and technology providers have been at the sharp end of the format’s development – dealing with a format war, a mature DVD market and recession – as newer technologies and business models have muscled their way into focus. Needless to say, the six-year journey has left many a casualty in its wake and managing the introduction of new technology has been key to the survival and success of those who remain.
Soho-based authoring house Dubbs/Eyeframe was one of the first in the UK to offer both HD-DVD and Blu-ray authoring back in 2006. Although the company ended up producing only a handful of HD-DVDs, it boasted the advantage of having much of the HD infrastructure already in place thanks to its post-production arm, according to Business Development Director James Greenwall.
“It made the difference,” he says. “It made it more difficult for smaller authoring companies to get in there early, because of all the extra investment. When an SR machine alone costs £100,000 it changes the viability of a project having to hire one in; having four in the building before we’ve even started helps.”
Early adoption allowed the company to get up to speed at a time when others were just looking to dip their toes in. “When Blu-ray started coming in, we were doing it relatively well,” Greenwall says. “We were already looking at making it better and producing better discs.”
Growth quickly followed and in a short time the majority of Dubbs/Eyeframe’s work involved both DVD and Blu-ray. The format has opened up a lot of opportunity for creativity, says Greenwall, and the company has been able to leverage its restoration department to offer high quality restoration projects, such as its work on the seminal documentary series, World At War.
“We are doing more and more projects where we are going back to the film with the results all ending up on Blu-ray,” he says. “Blu-ray has been a good format for HD restoration.”
In keeping with its early-adopting approach, Greenwall reveals the authoring house worked closely with manufacturers such as Rovi to develop aspects such as 3D and overcome issues early on. “We were working on projects where other people were beta testing, encountering and overcoming problems on project due for release,” he adds.
As a technology provider, Rovi (then Sonic Solutions) had the unenviable task of predicting the direction of the industry, initially offering two authoring solutions for both HD-DVD and Blu-ray. “As a consumer format, Blu-ray has been very successful,” says Sam Orton-Jay, Director of Product Management at Rovi. “It is a solid business without having the huge impact or return to the DVD days that people hoped for.”
Orton-Jay recalls that while many in the industry were attempting to predict the adoption cycle of Blu-ray, it was apparent that content owners were able to apply the same commodotized pricing seen on DVD. Furthermore, the relatively low number of titles in the early days meant that content owners could apply even more pricing pressure.
“From the beginning, the whole Blu-ray market was not going to produce as much money for everyone involved,” says Orton-Jay. “As a company we reacted to that reality quickly and our prices for the software were much lower than in the early days of DVD, whereas some of the competitors held the prices up longer.”
He continues, “It is sad that the pricing pressure that has come down from content owners has meant that we have ended up with a smaller number of companies and those companies don’t have the budget to work with, any more.”
A PROBLEM OF CAPACITY
The disappearance of so many independent authoring houses was a direct result of such pressures, says Dubbs/Eyeframe’s Greenwall. The effect of so many companies dropping out of the market, however, has left the industry with a capacity problem. “At times, distributors are finding it hard to schedule in their releases because those who remain are too busy,” Greenwall says. “You are left with a shortfall of companies who can service the work, and you’ve driven that shortfall.”
Authoring house The Pavement found itself in precisely that situation in 2011, turning work away ahead of Q4, according to Managing Director Andy Evans.
When several of the major studios started throwing money at testing digital delivery models from 2009, Evans believes many independent content owners held off on Blu-ray. It was during this period that many of The Pavement’s competitors went to the wall, collapsing under the cost of huge upfront investment, falling prices and consumer indifference; yet come 2011 and the picture dramatically changed, according to Evans.
“From February 2011 through to end of January 2012, it was mad,” Evans explains. “From August to September it felt like we were turning work away every other day as there were no authoring houses left.”
Evans points to a similar situation that is likely to arise this year, with clients putting off releases over a busy summer that takes in the Euro 2012, the Queen’s Jubilee celebrations and London Olympics.
“They are really worried that their bosses are going to push the button to get more product out in autumn and winter instead,” he says. “There are even less companies now.”
THE CREATIVE IMPACT
For Evans, the pricing issue has had a more lasting impact, driving creativity in the sector as low as possible due to budgetary constraints. “The creative benchmark for what clients require on Blu-ray has dropped dramatically,” he explains.
Evans questions why so little is invested in the element of the Blu-ray release that is seen by the consumer the most. In his experience, he says, clients are happy spending several thousand pounds on aspects such as tape dubbing but look to make savings on Blu-ray authoring, despite the considerably greater time and creative effort required.
“I have no explanation why the squeeze comes at our end,” Evans says. “The money is taken way from the place the consumer is going to see.”
When production houses are given the budget to flex their creative muscles, great things undoubtedly happen. Evans suggests 2011 was the point when the several major bands jumped on the formats, such as U2 and Iron Maiden. That such Blu-ray projects also came with bigger budgets is no coincidence, as band management were prepared to invest more heavily in the end product. The result was a British Video Association (BVA) award-winning Blu-ray Disc for the company’s U2 360 Live release, last year.
“Band management don’t mind spending money,” Evans says. “The money pressure is from the labels and distributors.”
At this year’s British Video Association (BVA) Awards, Dubbs/Eyeframe picked up the prize for Best British Authored Disc for its innovative work on StudioCanal’s Submarine. Dubbs/Eyeframe’s Greenwall acknowledges the issue of budgets, but says the challenge for authoring companies is to deliver high quality on tight budgets.
“That’s always the difficulty: trying to deliver quality above our competitors for the budgets we have to work with,” he says.
BD-J AND BD-LIVE
A possible victim of budgetary constraints has been the very features that sold Blu-ray in the first place: its interactivity through BD-J and web connected features of BD-Live.
Although Dubbs/Eyeframe also made investment in BD-J capability and BD-Live, very few projects have subsequently demanded their use. “Although we have done some projects, it just hasn’t taken off,” Greenwall says. “Mainly because no-one has the budget, unless it’s a particular disc.”
From a consumer perspective, if you buy from major studios you are likely to see many of the BD-J features; from a tools vendor perspective, however, it has been a huge disappointment, says Rovi’s Orton-Jay. Sonic Solutions found itself on the frontline tackling the workflow differences between DVD authoring and the move to Blu-ray Disc. But pricing pressure put paid to any decision to heavily invest in developing a solution for authoring houses, and Sonic’s strategy was to enable BD-J content across its platforms and partner with others.
“It would have been hugely expensive to develop an all-singing, all-dancing platform and it was clear there would only be a small number of companies who would be able to buy it and work with it.”
This, coupled with BD-Live’s proprietary web server technology – that is not adopted anywhere else – meant the technologies have generally only been used by the majors, Orton-Jay explains. “There are only a small number of production companies in LA serving those studios from an international standpoint, so that whole extra capability hasn’t been used as much,” he says.
Orton-Jay points to the rise of enhanced and interactive DVDs during 2005/2006 that has not occurred on Blu-ray. “All that is possible with Blu-ray as well but hasn’t happened and I think that is because the production budgets are just generally lower,” he says.
Dubbs/Eyeframe’s Greenwall believes that both BD-J and BD-Live are good technologies that simply have not found the space to be utilized. Although the consumer may have been unimpressed by poorly done uses of the technology in its early days, the opportunity to tap its social media potential is huge, he says.
“It’s not like UMD or Minidisc where it lost its space before it got going,” he says. “You could do some really good stuff with social media that is really of the moment. To really use it as a marketing tool, though, you need to do more and do it well.”
Dubbs/Eyeframe offers clients the ability to create and manage BD-Live and, according to Greenwall, has some of the best creative talent working on this side. However, the additional burden of costs associated with the technology, rather than the expertise itself, has put off budget-conscious labels.
“There’s no getting away from those extra costs that, sadly, clients don’t have the budgets for,” he says. “It means there are elements you can do to discs, creatively, but you need the right content and right budgets to be able to play with.”
The Pavement’s Evans has a more damning conclusion. That in hindsight, knowing the price pressure that was likely to be applied, the industry would have been better to adopt HD-DVD rather than Blu-ray.
In 2008, Evans was firmly of the belief that Blu-ray was the right technology to win the format war. Today, his mind has changed. “If you ask me today, I wish it hadn’t. I wish HD-DVD had won,” he says.
“If HD-DVD had won, it would have satisfied everything we do and it would have cost everyone less money to do it,” he says, pointing to smaller investment for HD-DVD replication, the cost issue with AACS, and the possibility that some titles will never come to Blu-ray, instead going straight to download-to-own.
“By the time Blu-ray won the war, and with the price pressure, barely any of those features will ever be used or be wanted,” Evans says.
THE CHALLENGE OF NEW TECHNOLOGY
After the lessons of Blu-ray, knowing whether to invest and when to invest in offering new technology is becoming increasingly difficult as the entertainment sector fragments.
Knowing when to back the right format is key, as Dubbs/Eyeframe’s Greenwall points out with the company’s decision to wait-and-see over adopting UMD – Sony’s now-defunct optical disc format for the PlayStation Portable – while going heavily into Blu-ray and Blu-ray 3D.
Moving into Blu-ray 3D early meant the company was also one of the first in the UK offering 3D and one of the first to produce a 3D disc, Streetdance 3D. “We have had relative success with 3D,” he says, noting that its slate of 3D projects is now in double figures.
Greenwall points to a recent 3D project for Revolver on the Werner Herzog documentary film, Cave of Forgotten Dreams, that showed off the capabilities of 3D, particularly on the menu designs. “The 3D menus we created were really strong and the 3D release showed how you can use the format across different genres,” he says.
Reflecting the position of the 3D market itself, Greenwall reveals 3D is not a major revenue stream although he adds that the company has seen a return on its investment. “I wouldn’t say it was a big financial opportunity to go out and author 3D titles,” he says. “But it’s a good add-on.”
Having made the investment in Blu-ray, 3D was the natural step for The Pavement, according to Evans. Having produced the first Blu-ray 3D in the UK, The Lover’s Guide, the company is now onto its ninth 3D release, in line with Evans’ expectations of the format.
However, he says, there still remains huge confusion in the market, even among clients.
“On one level, your clients see you as a source of education and expect you to help them with questions. I’ve had so many meetings with clients discussing what deliverables you need to have for 3D. Once you have offered Blu-ray, you are expected to be able to offer 3D.”
DECISIONS ON DIGITAL
Rovi’s Orton-Jay explains the decision to adopt new technologies is primarily driven by customer demand, weighing up opportunity against risk. He points to UltraViolet as the perfect example, in a situation where the specifications are still to be defined even though there is widespread adoption throughout the industry.
“We have a general mission to deliver tools in any way our customers require; you weigh those things up and make that call,” Orton-Jay says. “Obviously, the lack of standardization adds some dollars in the cost column.”
The challenge, he says, is timing when you move into a technology. With so many new technologies, however, he explains it becomes harder to justify upfront spends of $1 million-plus on developing solutions.
“Although UltraViolet has a lot of momentum, that is a challenge it has at the moment,” he says. “It is a chicken and egg situation with people not wanting to invest too hugely until they see it is going to be successful.”
UltraViolet still seems quite a long way off, says Dubbs/Eyeframe’s Greenwall. “We are ready to do that when there is requirement. It is something that everyone mentions but the actual platforms we are working with people on are outside of that.”
Greenwall reveals Dubbs/Eyeframe has invested heavily in digital, offering content management and servicing alongside authoring and creative editing to its clients. It makes sense for a company already working from uncompressed files for clients to have all the services in place to look after the digital side for clients, whether that is iTunes or another platform. “It allows us to be more competitive.”
Rovi’s Orton-Jay sees a general trend to having an online delivery format, such as Rovi’s own DivX delivery format that supports multiple audio streams and DVD or Blu-ray. Developing tools for production companies to create premium experiences for consumers is an exciting prospect, he says.
“We are finally getting to a situation where we can deliver content in multiple languages, using HD video and incorporating adaptive screening so people’s experiences can be delivered to multiple devices.”
He also points to the forthcoming interactivity specification for UltraViolet that he hopes will provide new opportunity for production houses.
“When we get to that stage, I really hope some of our long-standing DVD and Blu-ray customers can move into that area and start to deliver some of that unique value for that as well,” he says.