Physical Media vs. Online Distribution

I've been seeing announcements from the pop-music industry about the discontinuation of physical media in favor of online content. What will this mean for home theater, considering the increasing bitrates for video and 7- and 11-channel audio? If we are moving toward 4K, won't we need physical media for a long time to come?

Michael Johnston

We are definitely seeing a strong trend away from physical media—that is, CDs—and toward online distribution with 2-channel pop music, and online distribution of movies and TV shows is growing rapidly as well. I disagree that video bitrates are increasing—in fact, as video codecs improve, the bitrate actually decreases for a given level of image quality, which is especially important for online streaming.

On the other hand, the quality of online video cannot yet match that of Blu-ray, so I think—and fervently hope—that physical media will remain viable for a long time. Also, a lot of online video content includes only 2-channel audio, not surround sound, which argues in favor of physical media for the best home-theater experience.

Then there's 4K, as you mention. There is currently no distribution system for 4K content in the home, and I don't expect one for several years at least. Whatever that system turns out to be, I seriously doubt it will be online streaming—even with the most efficient codecs, 4K consumes a huge amount of bandwidth, much more than most people will have in their homes for the foreseeable future.

I bet 4K will eventually be distributed on some advanced form of Blu-ray or perhaps memory cards for a device such as Red Ray (shown above) from Red, the digital-cinema camera company. There are rumors that a consumer version of Red Ray is in the works, and if it comes to market, we could see 4K movies distributed on memory cards—that is, if the studios decide to release titles in native 4K resolution at all, which is not a foregone conclusion.

For our readers' take on the supposed end of physical media, see our poll question here.

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Old Ben's picture

The conversation about streaming and its growth always seems to ignore the role of internet service providers. I think ISPs are the biggest drag on the growth of streaming content.

Part of this is the ISPs' infrastrucutre - unless you have Verizon FIOS or the like, your bandwidth is limited, in part, by your neighbor's use of bandwidth as well.

Part of it also is the ISP's cost structure. The ISPs all seem to have teired pricing now, and anything but the slowest connection is generally pretty expensive. For example, I pay $40/month for a (theoretically) 10 MB/sec connection. My ISP would charge me $60/month to go up to a 15 MB/sec connection.

Finally, my sense is that most ISPs will throttle individual bandwidth if usage is too high. I recently bought the Lord of the Rings Extended Cuts on Blu Ray, which came with digital copies that are downloaded over the Internet into iTunes. Each of the three movies was about 3 GB in size. By the time I downloaded the third movie, our connection was pretty slow and remained bad for several days thereafter. This is anecdotal, but it makes a point. High streaming usage is likely to result in a slower internet connection as data for lower-usage customers is prioritized.

Unless the ISPs are on board and make changes to the above, I don't see how streaming can continue to grow into something that can replace physical media.

Scott Wilkinson's picture

I had forgotten about ISP throttling, which will make streaming 4K movies virtually impossible. I asked a poll question about throttling here:

And HT editor Rob Sabin wrote a blog about it here:

The cost and speed issues you raise are also important impediments to the notion that streaming will replace physical media.

Old Ben's picture

Scott, as a follow on to my previous point, the ISPs generally do not have any incentive to enable streaming video. On the contrary, ISPs likely are incentivized to limit or discourage streaming because most ISPs also provide customers with cable television. Streaming video likely will cannibalize cable revenues, e.g., revenues from commercial advertising and video on demand purchases.

My guess is that if we get to a point where the quality of streaming approaches that of physical media, the ISPs will charge a hefty premium for the bandwidth needed to enable it.

Osagie Omenai's picture

I found out about and have been reading Hometheater.Com for the last few moths and this is my first comment, and I would like to say I thoroughly enjoy the posts from Scott and the well informed comments from readers.
I have to say Old Ben's comments are from a decidedly american perspective. Over here in europe (I'm in Italy and I get uncapped 100mB fiber optic for less than 70 usd per month!) the situation is very different and I think we're way ahead of most of the USA.

I'm very into technology like the idea of not having Physical disks, I use a media center PC for my movie viewing and rip my blu ray disks (leaving the video and audio quality untouched) to a network attached storage and stream movies over the wired LAN of my house.

I think that we need to distinguish between the 2 different markets of 1) instant streaming and 2) digital download. For instant streaming, due to bandwith limitations, even over the next 5 years, quality will probably max out at 720p, and real bluray quality 1080p will not be available since for 99% of consumers 720p will be shap and good enough.

However, for 4k video and digital download i believe the situation is very different. When i rip my bluerays, once the menus, extras and foreign languages have been removed the average movie video file reamining is approx. 18-24gb (other than films like the godfather or Lord of the Rings which are more like 40gb). With next gen video codecs and the more powerful processors of today (already a potential trojan horse, a media player such as google tv is less than 100 usd, increasing the processor power to decode 4k would be a relatively minor cost) 4k video files should be possible and at videophile quality at sizes smaller than 50gb.

I think there will be a situation, and Ultraviolet, the new DRM technology may play a part as now is the case, where users will be presented with a number of purchase options from 720p to 1080p and right up to 4k for the conoisseurs wanting the quality and prepared to wait for an overnight download.

drblank's picture

The recording industry still can't grasp the fact that only a small number of CDs are released in anything better than 16/44, while the average Joe is opting for MP3 or AAC files to listen to music.

While Blu Ray can give us 1080 and DTS Master or True HD Audio, most people are opting for the lower grade 720p and regular Dolby DIgital, which is the norm.

I think the only people that can even legitimately think of getting 4K for their house will probably not have any decent catalog of content, so i think this, for the most part, is still just for the movie theaters and obscenely rich movie producers that want to see their 4K productions in their house, or just for Reference systems at the production company's screening rooms.

But for the average audiophile/videophile, it is a LONG way away.

notabadname's picture

Want to play a movie during the road trip for the kids in the back of the van?

Have movies to play at the vacation condo or cottage at the beach?

Own the media for physical or ripped playback on an aircraft?

Take a movie over to the friends house for movie night?

I like owning my movies and being able to physically touch them. And my ISP will not want me streaming a 50GB plus movie every night - especially 4K.

fcapra1's picture

Another issue is that the Netflix's of the world have to stop getting rid of some of their streaming content. I remember four or five months ago when my wife and I began watching Dexter via streaming. Two months later, Netflix took it down. It did this with other titles as well.

If streaming content will just come and go at the drop of a hat, then that is just one more reason why physical media needs to be here for good.

I would take issue that people are fine with just 720p quality. I though blu-ray sales were up?

mailiang's picture

Netflex is better for watching movies. I would go to Hulu Plus for TV. As far as Blu-Ray is concern, it's the only available HD replicated format, and due to it's generous bandwidth, it provides the best video quality period, regardless of the resolution limits of your HD TV.