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I think the big lesson is, you have to accept that technology empowers the consumer, and you have to adapt to that and really respond to what they're telling you. In music, consumers said, "I want to buy individual songs." In the case of movies, we're not getting resistance to the value proposition--people aren't saying they think DVDs are overpriced. People are saying "I want to watch the movie sooner." The question is, how do we as an industry respond without compromising the overall moviegoing experience?

It took a hardware innovation--the iPod--to get a lot of people excited about downloading music. Will it require a new gizmo to make people enthusiastic about downloading films?

PlayStation Portable, the gaming system introduced earlier this year, has become really popular for portable movie viewing. With legitimate networked downloading and burning, people will basically be porting movies to memory sticks and downloading them directly to their PSPs fairly regularly.

The other thing that's really caught me by surprise is mobile video. I used to say nobody wants to watch a movie on their cell phone, and I was wrong. We started selling copies of movies on memory sticks for watching movies on cell phones in the United Kingdom several months ago. We sold out in one month. I'm constantly surprised by people's desire to watch movies anywhere, any time. The whole nature of movie consumption among the younger, networked generation is much different than their parents'. That's going to start impacting the way movies are made and other distribution patterns. But it will take time--it won't happen tomorrow.

© 2005