5 Thoughts On The Dreamworks Ptch Announcement

Via: GigaOM

Late last week, DreamWorks announced their latest venture, a mobile computer program app that melds together photos, music, slideshows, mobility and sharing all into one. Christening it “Ptch” and taking a leaf out of just about every startup going these days, it is nonetheless unique to see a movie studio release an actual, honest-to-godness piece of software that apparently has nothing to do with their core business of selling movies and TV shows.

With that rather astonishing aspect to consider, here’s 5 thoughts on DreamWorks Ptch announcement and what it means.

1. DreamWorks must become a technology company

Amid over at Cartoon Brew muses about Ptch being a tool for DW to evolve in “different and unexpected directions” and he’s absolutely right. This is no doubt only the first salvo in DW’s shift from simple animation studio to an animation-centric technology company.

The unstoppable collision of art, entertainment and technology necessitates it. The future of DW as an independent studio is tenuous at best given the rapid shift in how content is created, marketed and sold. The traditional business model of box office grosses and DVD distribution is crumbling and it has clearly behooved Jeffrey Katzenberg to start looking in new directions (we’re told to expect an announcement within the next fortnight regarding distribution). Adapting a focus on technology will undoubtedly help in that regard.

2. The consumer approach is novel, if risky

DW isn’t alone in adapting a focus on technology, Pixar has long had a second revenue-generating division in its Renderman and associated software that are available commercially. The difference is that the Emeryville outfit is focused more so on the enterprise and business-to-business end of things. Sure, a regular consumer could purchase Renderman for their own use, but they aren’t the target customer.

DW, on the other hand, is gunning for the ordinary guy (and teenager) in the street with Ptch. While this can obviously create a large amount of value a la Instagram, it could also backfire as Google knows all to well with its ventures. Having said that, DW does have an experienced hand in Ed Leonard and the idea of Ptch itself does seem different enough from existing offerings that should give it a leg up in the marketplace.

3. There is of course an ulterior motive

While it is nice to think that DW is releasing Ptch as a nice little startup-esque service to gauge interest and provide something cool for consumers, the reality is naturally grounded in business. As Leonard himself explains in The Guardian’s excellent review:

Our DNA is rooted in content owners, so we’re trying to do this in the right way and make sure we respect content owners’ rights,” he says. “We really want this to be an opportunity for the content guys to make new revenue.”

If you read that right, you’ll get a hint that Ptch is more than just a pretty app, it’s a tool to gauge how DW can make the transition into the next generation of film marketing, i.e. directly to consumers. As Lenord himself notes in the Guardian piece, the notion of allowing users to download, remix and share their own creations using DW’s artistic creations is very much on the cards. (Read my post on something eerily similar that DW’s enterprise technology chief Kate Swonborg said a few months ago). Bear in mind that if that is the case, DW can stand to glean a lot (a lot) of really useful data about consumers that they can use to better their output.

4. What about the competition?

Leonard was smart in getting J. Katzenberg to agree to a separate business unit within the company as it gives them the necessary wiggle room that corporate structures don’t normally provide. Where does that leave competitors though?

Disney has long has trouble getting their internet strategy together (and apparently have a long way to go, if my efforts to watch the really cool Gravity Falls on Disney.com are any indication). Sony and Blue Sky haven’t announced anything yet but the former is likely to be hamstrung by the corporate parent’s influence and conflicting divisions (hey kids, remember the Walkman?) while the latter, as a division of FOX, may be too focused on being a studio to get into the technology game.

5. Good move/bad move?

Ultimately, this is an interesting, risky, unnecessary, innovative and potentially defining release for DreamWorks. The success or failure of Ptch will largely determine which direction the company goes in the near future. It’s existence as an independent entity won’t rest on Ptch, not in the slightest, but what DW learns from it will provide plenty of experience to enable them to make decisions with regard to it. If it succeeds beyond their wildest expectations, we may see DW start to emerge as the market leader, potentially overtaking Disney. If it fails, you can be sure they’ll have another crack at getting it right. Either way, its encouraging to see the company innovate with en eye to the future.

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