During that time, consumer technology has exploded with consumer-friendly inventions, from cellphone cameras and plasma HDTVs to Blackberries, iPods and Nokia's new N-Gage, a cellphone, MP3 player and game system combined in one device.
Music executives admit they were slow to react to the sudden appearance of Napster, but contend they hit a variety of speed bumps, especially in getting artists and music publishers to give permission to sell their music on the Internet. "There definitely was a cautiousness born out of a concern that we were dealing with things we didn't fully understand," Horowitz says.
For The Record
Los Angeles Times Wednesday November 12, 2003 Home Edition Main News Part A Page 2 1 inches; 31 words Type of Material: Correction
Movie piracy -- An article in Sunday's Section A about illegal downloading mistakenly identified 20th Century Fox Group Chairman Peter Chernin as News Corp. chairman, a title held by Rupert Murdoch.
"We didn't have anyone who understood technology," says Universal Music Group Chairman Doug Morris. "We had lawyers involved [in the creation of legal downloading services] who'd only read about technology in books. Look at Steve Jobs -- he changed the world. It required a technology company guy to bridge the gap, because having run a company like Pixar, he understood both creativity issues and technology."
Despite having seen the consequences of the record industry's failure to act quickly and provide a compelling legal downloading alternative, the movie business is in danger of repeating the same mistakes. Sony first tested the technology for its Movielink online movie store in 2000. But according to Stringer, it took two years of laborious negotiations to get four other studios to sign on as partners. Even today, Fox and DreamWorks don't license their movies to the service. Movielink still only has 450 movies available to download; and once viewers begin watching, their access to the movie expires in 24 hours.
"We believe those constraints are too restrictive," says Sony's Landau. "But this is a partnership, and some of our partners believe in restricting our service."
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Why are media companies so resistant to change, especially when compared to their technology brethren? One obvious answer: Tech companies are entrepreneurial. They live and die by the success of new inventions. Hollywood's main concern is content and, in recent years, it has pursued a deeply conservative content-creation strategy, churning out movie franchises largely based on comic books, remakes and sequels.
When it comes to new technology, change can be an especially scary proposition because no one can safely predict whether a new product will save or destroy a business. The Internet nearly wrecked the music industry. But home video recorders, which the studios fought tooth and nail when they first appeared in the 1970s, turned out to be a huge boon, creating a new profit stream for the movie business.
