Cinea execs disappointed encoding not finalized

HOLLYWOOD — Welcome to the Screener Snafus: Year Two.

Oscar voters will be getting their free DVD players by Thanksgiving, but Cinea’s ambitious screener plans seem to be on hold until next year.

The bottom line: Things will be just as confusing this season as they were last year.

With the deadline for studios to pick a format for awards screeners having arrived, no studio has yet signed on for the secure-DVD system proposed by Cinea. It’s possible that someone will, but not likely, since the first Cinea players are not expected to arrive for several weeks.

Cinea execs admitted they’re disappointed they haven’t finalized the encoding in order to get machines to studios that are making decisions now, but said members of the Academy of Motion Picture Arts & Sciences and of the British Academy of Film & TV Arts will get players by Thanksgiving, no matter what.

“This is not an all-or-nothing proposition,” said Cinea marketing veep Lawrence Roth. “Studios can make decisions now or once the system’s out there. We hope it will be used this year, but also expect it will be used in ongoing years.”

But while Cinea now has name recognition in Hollywood, the fact it couldn’t deliver on its promises has to be a setback for the company’s grander schemes.

This latest wrinkle is another blow to those who’d hoped for a permanent solution to the screener-antipiracy problem. But after last year’s Screener Wars and this new situation, it seems clear that no permanent solution is imminent.

However, some skeptics wonder if the screener frenzy is an overreaction. While everyone agrees piracy is a problem, last year one voter was found responsible for giving screeners to pirates. To some, one is enough. But others say that, in an era of cheap and small camcorders that can record films at a multiplex, the screeners-are-the-root-of-all-evil philosophy is a case of putting the antipiracy energy in the wrong place.

Either way, new MPAA topper Dan Glickman has to be relieved that all of this is going on predecessor Jack Valenti’s watch; although there’s no resolution yet, the issue was generated — and craziness ensued — in Valenti’s final months on the job.

Cinea is in the process of manufacturing more than 10,000 machines at a plant in the Philippines, which it plans to distribute for free — although its estimated cost is $5 million — to members of the two academies. Other voting orgs, such as the Hollywood Foreign Press Assn. and the Screen Actors Guild’s awards committee, also were offered freebies.

AMPAS had notified voters that they would receive a player unless they specifically said they didn’t want one. Fewer than 300 of the nearly 6,000 voters declined, but the Acad on Friday said the overall Cinea proposal seems to have changed.

“We may be approaching a point where it’s more likely the machines will be distributed this awards year, so that the system will be in place but not widely used until next year,” said Academy exec director Bruce Davis.

Cinea’s S-View players will play off-the-shelf DVDs as well as discs that are watermarked with other systems.

If the machines are indeed sent out, current DVD owners have the option of experimenting with the new machine — or leaving it in the box until next year. (And, since some awards voters had admitted giving their screeners to relatives, would anyone be cheeky enough to give away the new player?)

The free machines clearly were intended as a loss-leader for Cinea, a division of Dolby. The company hoped the majors would sign on to have Cinea duplicate their screeners. (The cost was said to be comparable to other antipiracy watermarking for DVDs.)

In addition, Cinea’s Roth said talks about screeners have generated discussions about using the technology for marketing screeners (i.e., copies sent to vidstore owners, reviewers, etc.) and digital dailies — markets that Cinea is hoping to enter as a result of its Academy link.

From the beginning, several studios were reluctant to sign on with Cinea. The majors that were leaning toward the company began rethinking their plans when they didn’t get players in time for testing.

Before committing to the system, studios wanted to administer a test, to see if the players were user-friendly. As one exec said, it’s easy for a Dolby tech expert to hook up this machine, but film execs needed to know if an “ordinary person” could do it.

In June, the company said it would be ready to ship players to the Acad members by October. That’s now been pushed back to November. The studios were told they would have testers before then; they still haven’t arrived.

Even though screeners have been mailed out since the late 1980s, the Academy had never before taken a stance on them, only emphasizing to members that films were made to be seen on the bigscreen.

But in June, the Acad gave its imprimatur to Cinea, saying a solution was needed for the piracy concerns and Cinea had come up with a good idea.

Antipiracy stirs up great concern and confusion in studios. A watermarked DVD has an invisible code showing to whom the disc was sent. But the big selling point of the Cinea system was that it was encrypted, meaning it only works on certain machines and is difficult to pirate. What’s more, if a title showed up pirated, Cinea’s system would indicate whose disc was the source of the copy and when it was last played.

But Cinea has rivals in the encryption biz, and it remains to be seen what developments they come up with before the 2005 season.

If they offer a similar player-disc combination, the new rivals would face the same issues as Cinea: Would voters disconnect their current DVD to install the new player? And since the Cinea discs only work on the Cinea machine, would someone vacationing in Aspen or Hawaii have to bring the machine with them?

Any antipiracy “solution” brings its own set of questions. Studio execs fret over how many formats they need to reach all the voters, such as a Cinea-type encrypted, alternate discs (for those Academy voters who declined the machine, for example) and videotapes (for those who don’t have a DVD player).

This season, some indies, like Lions Gate, are proceeding with plans to send out DVDs without encryption. (It also followed that plan last year.)

But no studio rep would speak on the record about screener decisions, for legal reasons. After the studios declared a screener ban in October 2003, the indies charged collusion, and U.S. District Judge Michael Mukasey declared it restraint of trade and unfair competitive practice.

The studios were advised by their own attorneys as well as lawyers for the Motion Picture Assn. of America not to consult with each other — and not to communicate via the press on any future screener issues. In other words, if one studio announces it’s going with System A, that could be seen as a signal to other majors to fall in line and also use System A.

Said one awards consultant last week, “It doesn’t seem likely that anyone would sue (over screeners) this year, but the majors didn’t see that lawsuit coming last year, so they’re not taking chances. I think the fear of God has been put into them by their attorneys.”

Optimists say that at least awards voters now have a heightened awareness of piracy; one studio exec added that voters have a feeling of responsibility about screeners rather than a casual sense of entitlement.

The other positive news for voters is that DVDs are back. In the last few weeks, the majors and indies have sent out questionnaires to Academy members asking for their preference between DVD and tapes. It’s a quiet signal that, after a one-year absence, DVDs will be sent out by most everyone.

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