BROADBAND REVOLUTIONIZING MEDIA DISTRIBUTION - TAPLIN

By Michael Bartlett

Broadband streaming media technology will fundamentally change the way people get their entertainment, but don't expect the media companies to stand idly by while their cash cow walks out the door.

That was the message from Jonathan Taplin, the CEO of video on demand Web site Intertainer.com.

"I have been around for three previous media revolutions that prefaced broadband streaming media, so I don't use the word revolution lightly," Taplin said today in his keynote address at the Internet World Spring 2002 trade show.

Taplin's lengthy career in the entertainment industry began in the early 1960s. He said he had the good fortune to be present the night Bob Dylan decided to "go electric" for a performance at the Hartford Pop Festival.

"Dylan got booed off the stage, but that night started a revolution - it marked the beginning of the folk rock movement," he said.

Taplin served as a road manager for Dylan for several years before switching to the movie industry in the early 1970s - where he discovered the power and fickle nature of cultural trends.

He said the success of "The Sound of Music" prompted the major film studios to bankroll a series of big budget musicals, all of which bombed.

"Then came 'Easy Rider,' a movie about a couple of hippies on motorcycles. It was made for $800,000, and it cleaned up at the box office. That was the end of the era of musicals, and made studios look at filmmaking and filmmakers in a different way."

The film revolution of the 1970s was launched on the genius of a flood of eager young directors who suddenly were given a chance by the studios, he said. This group, which included such soon-to-be luminaries as George Lucas, Steven Spielberg and Martin Scorsese, were asked to come to the studios because of their youth, not despite it.

"There were many great movies made in this revolutionary era, including 'The Godfather,' 'American Graffiti,' 'Jaws' and 'The French Connection.'"

Taplin said the third revolution occurred in 1984, when large media companies emerged.

"Now, we are on the verge of a new revolution, a media universe of incredible richness," he said. "But these media companies will do whatever it takes to protect themselves from the broadband revolution."

The broadband revolution will begin with greater connectivity, Taplin said. He predicted most Americans will have a 1-megabit-per-second connection in their homes within a year.

According to Taplin, if you look at the last three decades of art and commerce, there are several lessons to be learned about pop culture, technology, creativity and especially the nature of the distribution and marketing system for entertainment.

"Broadband in the home opens the way to turn the whole distribution and marketing system on its head," he said.

In an attempt to tap into this new system, Taplin said Intertainer is launching an alternative to traditional film distribution. The service, called Film Marketplace, is designed as a way for independent filmmakers to get their movies to the public and earn money.

Taplin said filmmakers pay a flat fee of $2,000 for a full-length movie of two hours or more, less for a shorter film. He said the fee covers the cost of encoding, encrypting and streaming the video. The filmmakers would keep all revenue generated by rentals at the Intertainer site.

All filmmakers are asked to submit a 30-second trailer to help sell their movies. Marketing is viral, as each movie has its own page - which allows budding directors to e-mail the URL to their friends and ask them to rent their movies.

"It is an experiment," said Taplin. "We think we can do it, but we will have to see how it goes."

One reason why Taplin believes alternative film distribution models will be successful is what he sees as the end of American cultural dominance.

"This dominance has been built on scarcity, which is disappearing," he said. "It was thought for many years that only the American market was big enough to support the entertainment industry. All of that is about to change," he added.

What is selling in Brazil is Brazilian music, he said. The same goes for England and Africa. "Gone are the days of Michael Jackson selling 45 million albums."

With faster access, streaming media will bring an abundance of entertainment choices. However, Taplin said he sees this as a critical time for governmental regulation.

"In encourage each of you to go to the site of the Federal Communications Commission, fcc-dot-gov. If you click on the name of the chairman, Michael Powell, you can send him an e-mail," said Taplin.

"You should tell him two things. First, make 750-kilobits-per-second the minimum for broadband. Second, no broadband provider should be able to filter out an individual URL. We don't want broadband to become a walled garden."

According to Taplin, if providers are able to filter individual URLs, it will limit consumer choices.

"There must be an open broadband Internet, and people need to speak up now. This will be decided in the next three months."

The future of home entertainment should be about connectivity through a variety of devices, Taplin said. He said Microsoft's Xbox and Sony's PlayStation 2 gaming consoles really are broadband terminals, and are at the forefront of a new wave of connected devices.

"Sony said it will put Real Player in PlayStation 2, and you know Microsoft will put Windows Media in Xbox," he said. "For $7 in parts, DVD players can add an Ethernet port and put a browser in it."

"We will see IP direct into set-top boxes," he added. "The cable industry understands IP is a more efficient way of delivery than MPEG-2, which is what they've been using. In five years, the number of channels over MPEG-2 will be drastically reduced, and IP will be used for on-demand content."

Taplin said he foresees a future when multiple devices are connected to a broadband connection, and digital TV sets will be plugged into these "home media sources."

"We will get to the broadband Promised Land," he said.