In the years of Thomas Edison, the business model of the motion pictures industry was vertically integrated and tightly controlled among a very few. The original inventors of the technology joined together and created a single trust called the Motion Picture Patents Company (MPPC) in 1908. From this time up until the Paramount Decision of 1948 when government regulatory forces broke up the tight vertical integration between content production and distribution, the industry was dominated by a few giant corporations exercising oligopolistic powers.

The Value Chain for this industry was a closely controlled, proprietary vertically-integrated monopoly. All the components: production, distribution, and exhibition were under the control of the studios themselves. This allowed them to engage in several practices including block and blind booking before these were deemed illegal in regulatory decisions by the federal government.

The introduction of Television had a powerful effect on the Business Model of the Movie Industry. Initially, television broadcasting was seen as a threat to the Movie Industry and its programming was a new competitor for the already declining attention of the film audience. However, by the early 1950s, the film studios recognized that the new technology was benefitting them. Past opinions aside, they did not hesitate to take advantage of a secondary market for their products, selling their extensive libraries for Television exhibition.

The arrival of the Videocassette Recorder (VCR) created another lash of retaliation from the Movie Industry. The technology, both Betamax and Video Home System (VHS), was met by a vehement lawsuit which, although taken all the way to the Supreme Court, proved ineffective. The Betamax Case of 1984 essentially paved the road for the introduction of new distribution technologies that were to come. As with television, the existing industries quickly realized that rather than fighting the technology change, they could have been profitting from it. Again they had found themselves in a legal battle against an alternative, and lucrative, new distribution channel. Direct sales of films to VCR owners quickly gave way to video sales to Rental Stores, creating the two-tiered pricing system that is still utilized with the introduction of DVD technology. With a 40 to 60 percent split of the rental revenues, the Home Entertainment category is now the most profitable segment for the Motion Picture industry.

The internet was met with similar trepidation. As though struck with the same inexplicable amnesia that repeatedly appears in their plotlines, the Film Industry completely ignores their history and continues to view technological advancement as a threat. The big 6: Disney, Sony Pictures, Paramount Viacom, Fox News Corp, NBC Universal and Time Warner, joined together to form the Motion Picture Association of America (MPAA). In an organization that bears the very same traits that led to government antitrust intervention a century ago, the major Hollywood studios have again united to create closed standards that hinder competition. Together with a similar organization in the music industry, the Recording Industry Association of America (RIAA), the MPAA exerts a concerted effort to find and prosecute internet-based piracy and file sharing. In place of embracing these technological advancements and evolving complementary technologies to generate greater profits, like the billion dollar online film business being operated by early-adapter Blockbuster.com, the motion picture industry is again seeking legal insulation against the natural progress of their industry.

I see two possible scenarios for the Motion Picture Industry in the next 5 years. One, it will succeed as it has never before in controlling the distribution and exhibition of its products. This will undoubtedly follow a multi-year court hearing and perhaps several appeals that will be costly not to the media corporations, but to the consumers who are subpoenaed for testimony for or against the practices condemned. Afterwards, movie industry products like HD DVD and Blu-ray will have multiple layers of encryption to prevent copyright infringement. Movie theaters will be equipped with state-of-the-art biometric security to prevent movie-goers from “movie hopping” within the theater. Blockbuster will require a password, DNA sample, and a large cash deposit prior to releasing any media for rental. The internet will be laced with information-eating viruses that seek out unlicensed copyrighted materials on civilian computers, erasing it and signaling the Ministry of Truth to prevent any further crimethink. Meanwhile, independent filmmakers will capitalize on the benefits of unsolicited word-of-mouth product marketing facilitated by a peer-driven audience base of information sharers to create the future blockbuster films with zero dollar marketing budgets.

Or the second scenario, where the lessons of cooperation and compatibility push the Motion Picture Industry to adapt to a digitally enabled consumer society. They evolve their product offerings into a format that takes advantage of the rapid file sharing capabilities of the continually broadening internet. The MPAA will pioneer the technology of degradable digital, where all digital files have a shelf life before evaporating into zeroes and ones. This becomes the new standard format for movie viewing, people watching degradable digital on their cell phones, ipods, laptops, and home theaters. Independent filmmakers and Hollywood studios both make giant amounts of money from the now much larger consumer pie as we watch the multiplex theater go the way of the opera house, becoming a quaint experience where parents take children for a night of nostalgia and pay premium prices. A new market of Film Viewing Houses emerge after the pattern of IMAX theaters, targeting the Audio/Videophiles who are seeking the “Ultimate” in film-viewing experience. Formal Standard Setting becomes secondary to a spirit of innovation so that the “Best” technological advancements can come to the forefront, with the understanding that the whole industry will benefit from an increased interest facilitated by an improved customer experience. Movie-making will follow in the direction that television and internet are now going. The consumer, not the seller, determine the content and usage practices.

These ideas may be a little far-fetched, but they stem from lessons that history has taught in the areas of electric current, telecommunications, and long-distance trav
el. Businesses that will continue to succeed are businesses that focus on the benefits they are providing to customers and which are capable of adapting their own business model to follow the advancement of technology as it realigns itself with that overarching goal. Media and delivery channels will continue to change, but creating a relationship of trust with your customer base will assure financial success and maximize long-term shareholder value. –Shawn Butler

I just read an article entitled Why Go to B-School? by Brandon Cornuke. I did not love it, but it has propelled me to articulate my own perspective. Cornuke narratively conveys his fairly ambiguous decision-making process as a function of padding his resume and killing some free time. I believe that these dispassionate motivations will not be sufficient to spur Cornuke through the intellectual and emotional gauntlet of an MBA program, even with his 720 GMAT.

The reason to get an MBA… in fact, the ONLY reason to get an MBA as I see it …is a passion for learning about business.

No one gets a law degree just because it would “help their resume.” It would be ridiculous to expect someone to labor through med school because they had 8 years of “extra time on their hands.” If I were getting my Masters in Entymology and you asked me if I liked learning about bugs, you have my permission to punch me in the throat if I respond, “No, I just really like the way Entymologists talk. And I think it will look great on my resume.”

I understand that going to college (undergrad) has now become something you do after high school. But graduate degrees should still be reserved for those who have a passion (at least an interest) in gaining more knowledge about a particular topic. Cornuke seems to fail to recognize that he will spend the next two years STUDYING BUSINESS before he gets those 3 initials added to his resume. He’ll probably do fine, it just bothered me that he alludes to no epistemological drive towards the subject for its own sake.

Wanting to Learn About Business is a great reason to get an MBA. Anything less will not have the power sufficient to generate the motivation to complete all the course work, projects and case studies that stand between a new student and his or her degree. If you watch MSNBC, read the Economist, WSJ, and books by Kottler, Keller and Hayes, or think you would like to read anything by the HBS, then you are the right person for b-school.

Here, as I sit typing in my 2nd month of classes, I would add:
A healthy dose of masochism doesn’t hurt. –Shawn Butler

New York City gets a bad reputation. As the most filmed city in the world, it is no wonder that I had many preconceived notions about NYC. Many of them were true. It is bigger, taller, and even more fast-paced than I had anticipated. I had blisters on my feet by the end of day 2. But I also had been lead to believe that this city was full of rude, selfish, busy and impatient people.

[youtube=http://www.youtube.com/watch?v=IIAdHEwiAy8]

This is a clip from “The Life of Brian” where Brian goes through a Basic Latin Lesson with a Roman Guard. (To See the Full Text Go Here).

CENTURION: Conjugate the verb ‘to go’.
BRIAN: ‘Ire’ – ‘Eo’. ‘Is’. ‘It’. ‘Imus’. ‘Itis’. ‘Eunt’
CENTURION: So ‘eunt’ is…?
BRIAN: Third person plural present indicative. ‘They go’.
CENTURION: But ‘Romans, go home’ is an order, so you must use the…?
BRIAN: The imperative!
CENTURION: Which is…?
BRIAN: Umm! Oh. ‘I’!
CENTURION: How many Romans?
BRIAN: Ah! ‘I’– Plural. Plural. ‘Ite’. ‘Ite’.

This is simply to complete my minimum requirement of Blogs for the month of August because I will be in NYC until after Labor Day. I have found that each month sort of develops an Unofficial Theme… Last month’s theme was “Why Steve Jobs Bugs Me.” The theme for the month of May was “Ambitious Things Other People are Doing.” April’s was “Stuff I Bought.” Well, August’s Unofficial Theme was “How Awesome is Latin?”

And, while searching Google, Ask.com, and Technorati for my blog, I recognized a common error I would like to address: Latin, the Awesome but Dead Language, is often confused with Latin as in Latin America, our Spanish-speaking brothers to the south.

This same error was attributed to Vice President Quayle in the quote: “I was recently on a tour of Latin America, and the only regret I have was that I didn’t study Latin harder in school so I could converse with those people.”

To Clarify this Point- Latin America is the region of North, South, and Central America where Romance languages are spoken, specifically Spanish and Portuguese. Interestingly enough, Quebec, although a fellow Romance-language speaker, is NOT considered part of Latin America. I think they should make an appeal. They don’t speak English, so where DO they belong?

To help you avoid confusion and potential embarassment, here are some examples of
Instances where people say “Latin”
and are NOT referring to
the Awesome but Dead Language:

Latin Dancing: As in “I like watching Latin dancing.” They are NOT referring to dances done by men in Roman togas, but to a whole style of dance including the Samba, Paso Doble, and Cha Cha that are characterized by much hip wiggling, short lop-sided skirts, and men in tight pants.
Fun Fact: All Latin Dancing can be done to the 80′s Madonna hit Holiday.

Latin Music: As in “I love listening to Latin music.” They are NOT referring to their record album of Pange Lingua done in Gregorian Chant, but to a hard-to-categorize genre of music with mostly Spanish lyrics. This includes everything from Mexican Ranchero, Luis Miguel, Control Machete, to Enrique Iglesias and Shakira. They even include Christina Aguilera, just because her last name is Spanish.

Latin Lover: As in “What’s hotter than a Latin lover?” Contrary to what you might think, this does NOT mean someone who took Latin and really loved it, then spent the next few years touring Italy and majoring in the Classics. Most typically, it is referring to a sexual partner, usually not a spouse, that is of hispanic origin. Who knew, right?

Latin Kings: As in “Can I join the Latin kings?” This is apparently NOT a bunch of Latin Professors or Catholic Cardinals that have formed a chess club, but in fact is a Puerto Rican Street Gang from Chicago. You can see how this might lead to confusion.

Um… that’s all I could find. I’m open to suggestions for More Helpful Hints. And… You’re Welcome! –Shawn Butler