Do viewers and listeners care about technical quality? Or do they care more about convenience? Or is this the wrong question? Can you have your cake and eat it, or not have any cake at all?
Many of us involved in the home entertainment business are keeping our eyes on the progress of HDTV, and also on the success (or, more likely, otherwise) of the two HD disc formats, HD-DVD and Blu-Ray. The fact that there are two disc formats, of course, makes their failure more likely, like DVD-Audio and SACD. In addition, people arguably don't want better quality - at least for the time being. Some companies, notably Microsoft (not at all, for a change, the winner in the downloadable media stakes) have an interest in helping both fail so that they win, resulting in a downloadable future that they control.
But it really isn't as simple as that. The fundamental question, in audio and video, is whether people are interested in quality.
The view expressed by Adam Vaughan, on-line editor at Stuff, in a recent article in The Independent fell into a set of common traps: talking of the failure of high-quality audio disc formats, he notes that instead of buying them, "in fact everyone went for MP3, which is lower in sound quality, but more versatile." Well, one reason they did that was that there was one too many new audio disc format, and CDs are still the major music medium, not downloads. But never mind. He concludes, "I think ordering movies over the internet will be more convenient."
There is a set of questionable assumptions inherent in these comments. First, that "everyone went for mp3". That's not what they did. "Everyone" (if we mean iPod owners: almost everyone is still buying CDs) has actually gone for aac (a rather better-sounding technology) and more importantly, they have gone with the iPod for convenience (along with some other factors including fashionability), and that choice has dictated the file format employed. The inference is that people have rejected quality in favour of convenience, whereas in fact they have replaced one form of convenience (the Walkman and its successors) with another. You could argue that the average quality of earbuds is sufficiently low that you can't tell the difference between a cassette and a CD, let alone cassette and a downloaded file.
The fact is that now, people have iPods, as they used to have Walkmen and Discmen: indeed, for convenience, but just as you could own a Walkman and still listen to CDs at home, you can own an iPod today and still listen to CDs or even surround-sound DVDs at home. Because you choose one technology for convenience when you're on the train, or whatever, where quality is not the issue and convenience is, does not mean that this is all you ever do. This is a very common misconception. Many of us, for example, have both hi-fi systems and personal stereos, and we use both - indeed, I use my home system more than ever and I have one music library, easily accessible, that I can use on virtually all of my playback systems, portable and otherwise.
In addition, downloads are under 7% of the market and during the first half of 2006 sales of downloads have actually dropped slightly in the US. Most people's "mp3" collection consists of copies of their own CD content (and, ahem, that of their friends), not downloaded content.
Further, there is an assumption that downloaded material has to be of low quality. In audio, this is not the case. There is Apple Lossless, WMA has a lossless mode, and there is also FLAC, the most popular of all the downloadable lossless formats. Now, it is perfectly true to say that at present the uptake of lossless formats is low. The big reason for this is that the iTunes Store doesn't support lossless download sales - at the moment. This may well change, although there will be a tradeoff: losslessly-encoded tracks will take up a bit more space and take longer to download - but with bigger, cheaper storage and faster broadband, this is less and less important.
And while people regard file-based music as being primarily for a portable environment, they may not be so interested in lossless downloads. But file-based music is moving back into the living room, with, for example, the ability to lift data from an iPod digitally via USB into a hi-fi system, which could give quality identical to that of a CD if Apple Lossless or similar was used to rip or download the audio. Server/player systems offer FLAC, WAV, Apple Lossless and WMA Lossless capability and some (Slim Devices for example) are experiencing a significant proportion (around a third) of their sales going to people who regard audio quality as being of fundamental importance.
Of course there is and will be a market for downloaded movies. There is certainly a video iPod market for TV shows (at least in the US, where many more are available). However the moment the screen gets bigger, current streaming media quality is not good enough and downloads will not be more "convenient".
Arguably, the bandwidth required to deliver acceptable (ie DTT or satellite) Standard Definition video quality on a regular TV, let alone the increasingly popular HD flat-panels, is already beyond that available realtime on the Internet as we know it. Even ordinary DVDs - which are obviously quite good enough for most people, especially when upsampled with a decent video processor - take some significant time to download on broadband: watching movies on TV is only a realtime activity at the moment if you watch them on a television station, and even using more modern perceptual coding techniques does not do the trick at present.
People definitely wanted the higher quality and other factors that DVD offered over VHS. In the only somewhat likely event they were ever to want anything better (for their HD display), it would be quite difficult to stream it with current Internet availability. Luckily, people do not seem to be interested in higher quality than DVD. But we already know that they aren't interested in lower quality.
So which is more "convenient"? Lengthy downloads, or buying/renting a DVD - a process with which everyone is familiar? The answer is obvious - this week.