8/2/2019 Nicholas Negroponte-prime Time is My Time

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Prime Time Is My Time 14

Bits for Rent (Inquire Within . . . )

Many people believe that video-on-demand, VOD, will be the killer application to finance the

superhighway. The reasoning goes like this: say a videocassette-rental store has a selection offour thousand tapes. Suppose it finds that 5 percent of those tapes result in 60 percent of allrentals. Most likely, a good portion of that 5 percent would be new releases and would representan even larger proportion of the store's rentals if the available number of copies were larger.

After studying these videocassette-rental habits, the easy conclusion is that the way to build anelectronic VOD system is to offer only those top 5 percent, primarily new releases. Not onlywould this be convenient; it would provide tangible and convincing evidence for what some stillconsider an experiment.

Otherwise, it would take too much time and money to digitize many or all of the movies made in

America by 1990. It would take even more time to digitize the quarter of a million films in theLibrary of Congress, and I'm not even considering the movies made in Europe, the tens ofthousands from India, or the twelve thousand hours per year of telenovelas made in Mexico byTelevisa. The question remains: Do most of us really want to see just the top 5 percent, or is thisherd phenomenon driven by the old technologies of distributing atoms?

Blockbuster opened six hundred new stores in 1994 (occupying 5 million square feet) on theforce of its entrepreneurial founding and former chairman, H. Wayne Huizenga, claiming that 87million American homes took fifteen years to have a $30 billion investment in VCRs and thatHollywood has such a big stake in selling him cassettes that it would not dare enter into VODagreements.

I don't know about you, but I would throw away my VCR tomorrow for a better scheme. Theissue to me is one of schlepping (and returning) atoms (by what is sometimes called "sneakernet"), versus receiving no-return, no-deposit bits. With all due respect to Blockbuster and its newowner,Viacom, I think videocassette-rental stores will go out of business in less than ten years.

Huizenga has argued that pay-per-view television hasn't worked, so why should on-demand TVwork? But videocassette-rentals are pay-per-view. In fact, the very success of Blockbuster provesthat pay-per-view works. The only difference for the time being is that his stores, which rentatoms, are easier to browse than a menu of rentable bits.But this is changing rapidly.Whenelectronic browsing is made more pleasant byimaginative agent-based systems, then, unlike

Blockbuster, VOD will not be limited to a few thousand selections, but will be literallyunlimited.

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