Tick-tock-tick-tock. Exhibitors: upgrade your concession stands (hint: start with espresso machines).  Your “theatrical window” subsidy is continuing to crumble. Can anyone get me any advance tickets to next year’s ShoWest exhibitors convention in Vegas?  I’d love to be there to witness the panic, outrage and denial.

Sunday’s NYT Business section (9/26/10) has this enjoyable article that just continues to affirm what I’ve been saying for years, along with every other new market realist: we are moving inexorably towards a software distribution model where “day-and-date” means a lot more than 10,000 screens worldwide -  it means all screens and all platforms simultaneously for the 1.0 version of a particular title.

Bob Iger: you are my new executive hero.  You seem to be the only CEO eschewing the  chicken-little denial and bluster of some of your fellow titans and taking a daring stand in favor of exploring new business models.  This is particularly significant and courageous in light of (as the article points out) the fact that the entire motion picture revenue model depends on the theatrical window (particularly the domestic theatrical window) as the benchmark for calculating what other revenue channels are going to pay the distributors for their window (e.g. pay television, and, of course, DVD).

So in a very real sense, studios are jumping out of the plane trusting that there’s a working parachute in their backpack.  Unfortunately, they have no choice, because the plane has run out of fuel and is crashing in any event.

Seriously, there will be no easy solution to this problem.  The current interlocking business models and revenue streams have taken years to evolve and develop, and were based on a significant truth: distributors could effectively control access to content and apportion titles across release platforms.  As Iger points out in his quote in the NYT article, consumers want their content when they want it, where they want it.  With content everywhere, and available instantly, studios need to be able to provide new content on the same basis as old content, and the proliferation of content, unfortunately, exerts a downward pressure on pricing across the board.  So the future will be increasingly tiered, with all content available everywhere at any time.  Pricing models will continue to change, with (hopefully) increasing flexibility and a migration to subscriptions as well as single purchases.

The cold war between distributors and exhibitors is heating up.  It’s going to be an interesting year…