One of the more interesting subtexts to the battle between Disney and Sony Pictures over the work of the Digital Entertainment Content Ecosystem consortium (DECE) is the degree to which the studios have come to resemble each other. Sony Pictures has long been a captive of Sony Electronics. Decisions on what technologies or which formats to support are not made independently by Sony Pictures; they’re made by Sony Corp. in accordance with Sony Electronics’ technology or device strategy. That’s why Sony bought Columbia Pictures and CBS Records, after all: to be sure it had content to feed its devices.
In Disney’s rejection of DECE we see a similar dynamic at work with respect to its technology master, Apple. The parallel isn’t exact; Apple doesn’t literally own Disney. But Steve Jobs is Disney’s largest individual shareholder and sits on its board of directors. He obviously has a loud voice on what technologies and which formats Disney supports.
How do I know Apple is a factor in Disney’s DECE stance? I don’t have direct knowledge of it, of course. And I’m sure Disney executives would sputter and fume at the allegation. What makes it a reasonable conclusion, I think, is that there is no obvious or compelling reason for Disney not to support DECE, at least officially, if not enthusiastically.
I can see lots of reasons to be skeptical of DECE. It’s already taking too long to produce results and it’s likely to require so many compromises as to be only marginally useful at best. But I don’t see a big downside for a studio in keeping a hand in. It could, of course, turn out to be a waste of time, but the studios waste time on inter-industry groups all the time. Disney Home Entertainment president Bob Chapek has, himself, served as chairman of the Digital Entertainment Group, for instance, which is a complete waste of time, to say nothing of the $10,000 per company in dues. It’s possible the work of DECE could lead to something useful, which can’t be said of the work of DEG. I don’t see the downside to a studio from being involved, or the upside in trying to scuttle it.
Apple’s opposition to DECE, on the other hand, makes perfect sense. Apple has never believed in device interoperability, unless they’re all Apple devices. And it has done very well by following that strategy, as its Q3 earnings report this week makes clear. But a large part of Apple’s success in the device business has also come at the expense of content owners, as the music companies can explain (Disney, of course, was the first studio to sign a deal with iTunes). DECE’s success would be Apple’s failure. But it’s hard to see how it would harm Disney, were it not for Steve Jobs’ interest.
As is happens, another major studio, NBC Universal, could soon come under the control of another technology company, Comcast. Comcast’s interest comes at a time of technological upheaval in the pay-TV business, and Comcast officials have made no secret of their desire to control the technological exploitation of NBC’s content assets, particularly its cable networks.
Should a Comcast/NBC deal come to pass, three of the six major studios will be controlled — if not literally owned — by technology companies with distinct agendas regarding the evolution of media business. Rather than playing kingmaker among technology providers as in the past, the studios are becoming the pawns.