TOKYO — Matsushita Electric Industrial Co. has established a laboratory in Hollywood, Calif., under its Panasonic brand name, to ensure the company can help define compression technology, networking and hardware for next-generation DVD and content-distribution formats for broadband video on the Internet.
Panasonic Technologies Inc.'s Panasonic Hollywood Laboratory, nestled on Universal Studios' grounds, will be staffed initially with eight researchers who will first work with Universal Music Group (UMG) on music distribution products, said lab director and vice president Masayuki Kozuka. Matsushita has been testing out this venture through extensive trials with UMG and Bertelsmann Music Group since 1999.
While most of the core development work for next-generation products will be done in Japan, Kozuka will also lead an internal Digital Video Quality Center, which he said will act as an incubator for combining technology with marketing ideas on Hollywood's doorstep.
Matsushita is focusing on two image compression technology development themes for digital cinema and broadcast: D-Cinema compression using QuVis at 30-60 Mbits/second and DTV compression on MPEG-2 at 20-25 Mbits/s for DTV broadcasting, said Kasuhiro Tsuga, general manager of Matsushita's Multimedia Development Center (Osaka). For High-Definition DVD (HD-DVD) the company is developing a disk on MPEG-2 at 20-25 Mbits/s and movie distribution compression on MPEG4 at 100-300 kbits/s for portable viewers and PDAs, he said.
While Matsushita feels it has a broad range of compression technologies available, the lab's more fundamental purpose, Kozuka added, is to make sure the parent company is at the heart of key Hollywood decisions on the future of digital cinema.
"Our blue laser-based High Definition DVD technology is getting close to being ready. But Hollywood is concerned about new DVD technologies and how much it could hurt current DVD. We have to check out new DVD business models and marketing," Kozuka said.
AOL Time Warner, for example, considers next-generation DVD introduction will be appropriate when the present DVD market reaches saturation. "The question is who will take the initiative for introducing next-generation DVD," said Tsuga.
More than this, Matsushita feels it has learned a fundamental lesson demonstrably forgotten at least once by every major electronics maker since the original Betamax-VHS format battles 20 years ago, said Tsuga: Great technology without a business model brings on disaster.
"We have the core competence in technology in Japan, but in the United States the business model is the key. Three years ago we launched Digital TV, but sales were miserable. We don't want to make the same mistake, so we need to market and we need to make networks of contacts," he said.
Hollywood's big-seven studios are all concerned that digital cinema does not go the MP3-Napster route, said Kozuka. "Disney and Sony Pictures Entertainment are beginning small trials with digital cinema. When broadband comes in three to five years, they don't want to lose more business," he said.
