Owning music and movies may soon be a thing of the past

This appeared in the January 19, 2007 issue of USA Today. MP3s were around, but the con­cept of stor­ing your con­tent online — let alone hav­ing your entire music library there — was unheard of.

usat-musicFor some peo­ple, the con­tent they own is a brag­ging point — whether it’s how many albums, DVDs or books they own. But we’re quick­ly approach­ing the point where own­ing con­tent could seem quaint and unnecessary.

On Tuesday, Netflix announced it will allow sub­scribers to watch movies and tele­vi­sion shows on demand through their broad­band con­nec­tions. The full col­lec­tion isn’t avail­able yet — just about 1,000 titles — but the com­pa­ny said it will expand its on-demand col­lec­tion and already has sup­port of a bunch of stu­dios, includ­ing MGM, NBC Universal, Paramount Sony, 20th Century Fox, and Warner Bros.

This is a Big Deal — espe­cial­ly when you com­bine it with some exist­ing products.

It means once Netflix’s entire col­lec­tion is avail­able, you would nev­er need to own or phys­i­cal­ly rent a movie again. No more comb­ing the aisles of Blockbuster or wait­ing for the Netflix disk to arrive in the mail. Any movie, any time.

Let’s deal with the obvi­ous down­side first: This requires a broad­band con­nec­tion, which most peo­ple get through their com­put­ers. Ergo, it means watch­ing these movies on your PCs, which — let’s be frank here — ain’t all that great. In fact, in its announce­ment the com­pa­ny said, “We’ll work to get to every Internet-con­nect­ed screen, from cell­phones to PCs to plas­ma screens.”

But com­put­ers that con­nect to tele­vi­sions are out there. Microsoft’s Windows Media Center Edition, for exam­ple, was designed to let you watch and record tele­vi­sion through your com­put­er, but it also works the oth­er way — lets you watch what’s on your com­put­er, on your TV. In oth­er words, it’s not a major step to watch Netflix on demand for your TV. In fact, in September 2004 Netflix and TiVo announced they were work­ing togeth­er, and although that part­ner­ship has lan­guished this might a cat­a­lyst to get things mov­ing again.

From a busi­ness point of view, deliv­ery by wire is a great idea for Netflix. The cap­i­tal invest­ment might be high, but if this new pro­gram ever sup­plants its disk-by-mail ser­vice, it would be a huge sav­ings. No more hav­ing to buy or burn hun­dreds or thou­sands of copies of the same movie. No more postage. No more pay­ing folks to sort through bins of movies. Instead, its invest­ment would be in stor­age space (cheap), band­width (cheap), and a dis­trib­uted net­work (so some­one in New York does­n’t have to get his movie from a serv­er in California).

From a con­sumer point of view, it’s the shape of things to come. In the music world, it’s already been around for some time.

Libraries in space

When you think of down­load­ing music, two things come to mind: pirat­ed music and iTunes. They are, after all, the num­ber one and num­ber two ways peo­ple get music online, respec­tive­ly. Other, legal, online music ser­vices are over­shad­owed by iTunes mar­ket dom­i­nance. But that is like­ly to change for a cou­ple of reasons.

First, if you buy music from iTunes, you can only lis­ten to it on your iPod — you can’t play it on any oth­er brand of portable play­er. If you decide to get, say, a SanDisk Sansa instead of an iPod, you can kiss what­ev­er you got from iTunes good-bye, unless you burn every track to a CD first, then re-rip it. Fun.

The sec­ond rea­son ties into the Netflix announce­ment. When you get right down to it, the iTunes mod­el is a small step from the old music mod­el. You’re buy­ing a sin­gle. Instead of a 45 from the local record store, though, you’re buy­ing a track from Apple. Instead of stor­ing it on a shelf, you store it on your hard drive.

Either way, it’s yours. (Well, most­ly. That 45 did­n’t come with restric­tions the way an iTunes down­load does.) Whether via iTunes, CDs, or those old 45s, your music library con­sists of what­ev­er songs you’ve pur­chased, just as your video library con­sists of what­ev­er DVDs and tapes you own.

But the Netflix announce­ment could end the idea of “own­ing” a movie. Why both­er, when every­thing is on demand? Similarly, why both­er own­ing a song when you can lis­ten to it any time? That’s the idea behind Real Networks’ Rhapsody service.

With Rhapsody, you don’t pay per song, you pay per month for access to the entire mul­ti­mil­lion-song library. So you don’t own the music any more than you own a movie you watch with pay-per-view. It’s there for the ask­ing wher­ev­er you have access to a broad­band con­nec­tion. (You can also buy an indi­vid­ual song, a la iTunes, for a buck — 89 cents for members.)

Let’s say you’re head­ing to the gym and want a work­out mix. Instead of going through the music col­lec­tion on your com­put­er and choos­ing what to copy to your music play­er (be it iPod, Sansa, MuVo, or what­ev­er), you choose from Rhapsody’s entire collection.

This is where things are going, for bet­ter or worse: cen­tral­ized libraries for most of our con­tent needs, per­son­al ones for (Suzy singing at the high school musi­cal) per­son­al stuff.

You’ll see gen­er­al libraries like iTunes and Rhapsody, and spe­cial­ized ones for spe­cif­ic gen­res. And once the infra­struc­ture is in place — ubiq­ui­tous broad­band, open-source deliv­ery soft­ware — it won’t just be com­mer­cial providers open­ing up their libraries. Individuals and groups will, too, whether a band, a co-op, or just a fam­i­ly. Or pirates; you can bet there will be servers offer­ing unli­censed tracks as well, and pre­cious lit­tle to stop them.

And if broad­band becomes tru­ly omnipresent, imag­ine the future of in-car enter­tain­ment. Instead of choos­ing a genre on satel­lite radio, you could choose the indi­vid­ual songs and pro­grams you want­ed via a broad­band radio. Meanwhile, the kids in the back could be watch­ing TV, or what­ev­er movie they felt like streaming.

The best thing about all this is that it’s not in the far future. It’s around the cor­ner. Hotspots are get­ting less spot­ty. Cities and towns are deploy­ing broad­band, and that broad­band is get­ting faster. And wire­less options are also emerging.

It may not be long before own­ing an album, movie, or even a book is rare, and its val­ue is tied to its orig­i­nal, tan­gi­ble format.