In Hollywood, direct-to-video movies, and the folks who make them, have always been second-class citizens. But it’s clear from recent media earnings reports that recent changes in the DVD market are now driving the type of movies the upper crust is making as well. Call it, direct-from-video. In Viacom’s Q4 earnings call earlier today, for instance, CEO Philippe Dauman said slumping DVD sales are weighing heavily on green-light decisions at Paramount Pictures.

The big issue in terms of profitability [in the filmed-entertainment business] was the decline in home entertainment sales, which hit the entire industry,” he said. “As we look at the green-lighting process we will take into account the shift in the landscape. We have to take into account the possibility that the decline in home entertainment revenues will continue at least for a while and when we green-light films we will take that into account.”

What that means in practical terms, Dauman made clear, is more “franchise,” or “tent pole,” movies, like Iron Man, Star Trek and Transformers, which increasingly are the only things that sell on DVD, and less of everything else.

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At the Future of Music Coalition’s Policy Day conference in Washington, even those hoping that the Obama administration will spur a major overhaul of U.S. copyright and telecommunications law acknowledged it would likely be some time before they can get the attention of Congress and the new administration. In the meantime, they said, the major copyright action will be in the courts, where a handful of crucial cases pitting copyright owners against technology providers could produce important new precedents.

“We were very pleased to see that the chairmen of the House and Senate Judiciary Committees care so much about copyright that they’re elevating it to the full committee level [rather than the usual IP subcommittee path], but the Judiciary committees are going to have pretty full agendas for the next couple of years so I think it will be pretty hard to get their attention on copyright issues,” said David Carson, general counsel at the U.S. Copyright Office.

Carson is not among those hoping to see a major overhaul of U.S. copyright law. But Public Knowledge president Gigi Sohn, who definitely is, reluctantly concurred with his assessment.

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