In movie matters, learn from the PSP's mistakes

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My colleague Christopher Breen took note of news reports that Apple is negotiating deals to bring full-length feature films to iTunes. I earnestly hope that the executives making these decisions look at another recent folly—UMD discs for the Sony PSP.

The Universal Media Disc, or UMD, is an optical disc format that Sony introduced when it released its PlayStation Portable (PSP). It’s a small disc that’s used not just to contain games, but also movies.

After the PSP went on sale in North America early in 2005, several movie companies started releasing movies on the UMD format right alongside new DVDs. They even made the UMDs part of their ad campaign. (Remember those ads that said “Now out on DVD and PSP?”)

The result? Initially, it wasn’t bad—actually, analysts were surprised at how successful UMDs were. But it turned out to be a pretty short-lived fad. By February of this year, major studios including Paramount, Warner Home Video, and even Sony Pictures Home Entertainment itself all announced they were cutting back PSP releases, citing slow sales.

There were several reasons why the UMD format hasn’t been more successful for movies.

While they’ve largely fallen in line with DVD prices now, UMDs initially cost more than DVDs did. Their limited storage capacity meant that UMDs didn’t contain all the extras that DVDs did, either. So you essentially paid more —or, in a “best” case scenario, the same—for less content. And you paid this premium just for the convenience of having your video in a more portable format than before.

Meanwhile, PSP owners discovered that it was pretty easy to get video from a DVD onto a PSP. Using free software available for both Macs and PCs, it’s possible to rip a copy of the DVD video onto your computer’s hard disk. Even though this violates the letter of the law, that hasn’t stopped a lot of consumers from doing it—and many consider it a pretty victimless crime, as long as you’re using a DVD that you own.

Once the video is ripped and converted to MPEG-4, it’s a one or two-step process to get that content onto the PSP’s Memory Stick, using one of a variety of PSP sync utilities for Windows and Mac OS X. You can even do it yourself using nothing more than a USB cable, as long as you’re willing to plumb the depths of the Memory Stick’s directory structure and follow the PSP’s naming conventions.

So ultimately, consumers can spend $15 or $20 on a DVD, transfer a copy of that video to their PSP, and still have the movie in a pristine format that they can play on their home entertainment center.

So what’s the point of having a UMD movie?

More and more consumers have been asking themselves that, it seems, because by March of this year, Universal Studios had stopped making new releases on UMD too. Retailers have threatened to back away from stocking movies in UMD format. The future of the medium—at least as a delivery system for new movies—is grim indeed.

What’s more, this ripping and transfer technology is equally easy to use for the iPod. While it requires a level of technical sophistication that’s just slightly beyond the mechanics involved in buying and downloading content from the iTunes Music Store, shareware and commercial developers alike have made it increasingly easy to get whatever video you want onto a fifth-generation iPod.

All of this should serve as a cautionary tale to movie studios as they seek to negotiate deals with Apple to distribute full-length movies on the iTunes Music Store. And that lesson is, don’t make the movies too expensive. Consumers have already proven that they’re not willing to deal with onerous restrictions just for the privilege of making their video portable—Sony can tell you as much.

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