Oh, what a shame it is that the U.S. is a third-world country -- at least when it comes to Internet download speeds for massive files, such as movies.
While parts of the world (think Korea, China and the Netherlands) now have dedicated portal-to-door optic fiber Internet connections, with lightning download speeds for films, the U.S. has so far treated the Internet as a sick sister that must make do by riding piggyback on other connections to the home, such as telephone wires, cable, or satellite, which download at dinosaur speeds compared to optic fiber. As for use of telephone wires, we are saddled with fragmented Baby Bells that have a vested interest in keeping the status quo to milk their geographic monopolies rather than investing in the future, and that won't change any time soon. And cable companies are making plenty of money, thank you, off their current systems and don't see any need to upgrade their systems to optic fiber either. While Google has begun implementing an optic fiber system in two cities, it will be a slow slog and years in the coming.
Which leaves the U.S. with a creaking, antiquated Internet system that is ill suited for downloading films to own. For streaming (e.g., Netflix), the Internet works just fine, but to download and own a film, you need fast download capability to make films the "what you want, when you want it" experience that consumers demand. It generally takes hours of dedicated computer time, and often the downloads get interrupted and must be restarted. For this reason alone, the Internet is unlikely to be the great panacea for film distribution that it is widely believed to be for those that want to own, as opposed to rent, a film.
Internet bandwidth is a limited resource, and more demands are being put upon it every day. One or more of several things are going to happen: either download time is going to get longer due to volume, or there will be limits on what you can download per month, or you are going to have to pay -- a lot -- for the benefit of speed. And even after a successful download, you must then struggle to figure out how to move the film to the device you want to view it on, such as a TV or mobile device, since convenient portability of downloaded films is far from a reality. Just try watching a film downloaded from iTunes on a Microsoft Xbox console.
But technology is upon us that will dramatically goose film distribution until the happy day that the Internet moves to optic fiber. The latest USB flash drive (3.0) is now available, and it can download a film in less than thirty seconds. You can hold an entire film library in your pocket, and you can connect it to almost any device, including computers, set-top boxes, mobile devices, the latest flat-screen TV sets, and, through an adapter, to older television sets. The films will be available at kiosks, just like Redbox, but with unlimited film choice, no requirement for the consumer to have to return to the point of purchase, and direct royalties to the studios to avoid stepping on their toes. The customer will have the choice of renting or buying (with different price points). The technology incorporates digital rights management software that limits access to the customer's own devices, and piracy protection is better than for all other media.
Imagine you are about to board a plane with your laptop, and you come across a digital kiosk at the airport lounge. Or you come across the kiosk at Starbucks on your way home. Pick one or more films of your choice, decide whether to rent or buy, and download each one in less than thirty-seconds to your USB flash drive. Plug it into your device of choice, and viola!
There are a number of companies working at the kiosk technology to make this a reality, including Digiboo (full disclosure: the author is a co-investor with Morgan Freeman in Digiboo). The race is technological, as it requires a highly sophisticated system to implement all the required elements, as well as requiring savvy marketing and film expertise and enough capital to roll it out. But the race is on, and this is the future -- at least in primitive Internet countries like the U.S.