"Ironically the mistake the major labels made was the same one that IBM made when it gave the DOS franchise to Microsoft nearly 30 years ago. They were faced with a new market that they didn't understand. They had a piece of work that they couldn't do on their own or didn't want to do on their own and they didn't view it as critical or important, so they outsourced it to a partner. The partner turned that seemingly unimportant work into a way to accrue power and create a monopoly and control the industry. Today in the music business we're about where IBM and Microsoft were in 1989, when IBM finally got hit with the clue stick and realized what Microsoft was doing. "
That's the best analogy I've read so far for the cluelessness of the record labels when it comes to digital content delivery, and it ended rather poorly for IBM, as I recall.
Part and parcel of the console strategy for both Microsoft and Sony is a next-generation video disc into their consoles. Microsoft's using HD-DVD in the xBox, and Sony's using the competing and incompatible Blu-Ray format in the PS/3. The idea was that gamers would buy a console and play games on it and then use it as a disc player, too.
"In a recent study by The Diffusion Group, analysts discovered some alarming facts about gamers and just how often they use—or know they can use—the multimedia capabilities of their consoles. Here are the numbers:
- 80% of console owners can playback DVD or Blu-ray discs. - 30% even know about those features - 13% use those features
- 42% of gamers with consoles hooked to broadband have streamed video through them in some fashion."
It's that last stat that's the most-interesting. We've got the audio-video firepower at our house to handle hi-def discs, yet I've never once considered getting either a Blu-Ray or HD-DVD player. On the hand, I've been batting around the idea of getting an AppleTV some time in the future. Both disc formats don't offer enough benefits for me to upgrade to a Hi-Def format, but being able to download and watch a movie the same way I download and listen to music in iTunes is a very interesting idea.