Quantum Leap for Internet Movies

The first celebrity-driven film produced exclusively for online distribution made its premiere last week, and the producer says there are no plans to exhibit the film in theatres. “Quantum Project,” starring British comic actor John Cleese, is available for download from SightSound.com for $3.95 (US$).

The 32-minute film blends computer animation and live action. Cleese — famous for his Monty Python routines — plays the father of a physicist who is having trouble with love and reality. The film was made for $3 million and was produced by Metafilmics, creators of the Academy Award-winning feature film “What Dreams May Come.”

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According to Metafilmics producer Barnet Bain, the Internet is never going to replace the movie theater, but the Web will eventually become a competitive storefront for film distribution.

“There will be a shakeout of the business model. What’s at risk is the video store, because why would anyone rewind a video, go out of the house and take it back for another one, when feature films can be selected online at home?” Bain asked.

One reason could be that while “Quantum Project” takes only 15 minutes to download using a broadband connection, the download time could run over four hours using dial-up access.

Too Slow for Showbiz

“Quantum Project” is not the first Internet-distributed film, but industry observers consider it a significant advance because of the names and dollars involved. While maverick film companies promote their various “firsts,” most Internet consumers lack the high-speed digital connections necessary to download large content files at a reasonable speed.

An estimated 95% of all Web surfers still connect to the Internet with dial-up modems, which are limited to transferring data at a maximum speed of 56k per second — way too slow for downloading huge multimedia files. According to Jupiter Communications, a technology consulting firm, 15.3 million U.S. homes will have broadband by 2003, but current penetration among today’s households is almost negligible. The vast majority of Internet-enabled homes — 43 million — currently have narrow-band connections only.

Opening Up the Studio Vault

Consumers are also still waiting for full-length features, which have been promised by at least two major studios. SightSound.com recently entered a non-exclusive agreement to make 12 full-length, feature movies from Miramax Films available for download.

Specific Web sites will be created to market each movie, with SightSound.com providing encoding and encryption technology and processing online ordering, in exchange for a portion of Miramax’s proceeds.

The decision by Miramax to offer movies over the Internet for consumers to rent or buy followed a similar move by MGM Studios. According to Metafilmics’ Bain, the major studios are going to make their catalogs available online — but yet to come from made-for-Internet films is a new paradigm for storytelling.

“An analogy can be made to putting music singles on video. No one thought it would work, but MTV created a new kind of storytelling. With film on the Internet, we are at the beginning of the beginning,” Bain said.

Keeping Mum

Metafilmics and SightSound.com are not saying how well “Quantum Project” did on its opening weekend, with the explanation that SightSound.com has just filed a registration statement with the U.S. Securities and Exchange Commission for an initial public offering of common stock, and is in the mandated “quiet period.”

SightSound.com, which was founded by engineer Arthur Hair and entrepreneur Scott Sander, is sitting on a portfolio of patents covering its technical innovations for the delivery of digital audio and video files over networks.

In January 2000, the company was awarded United States Patent No. 6,014,491, titled “Method and System for Manipulation of Audio and Video Signals.” The technology reduces the file size of motion pictures to speed their distribution over the Internet.

Also in January 2000, Intertainment A.G. invested $20 million in cash and stock in SightSound.com. Intertainment A.G. is a German-based distributor of motion pictures in the European and Asian markets and is currently financing many large-budget films in Hollywood. The company’s investment in SightSound.com was made subject to regulatory approval.

Roll Credits

“Quantum Project” was directed by Eugenio Zanetti (“Restoration”; “The Haunting”) and also stars Stephen Dorff (“Blade”) and Fay Masterson (“Eyes Wide Shut”). It was written by David Aaron Cohen (“The Devil’s Own”) with production design by Oliver Scholl (“Godzilla”; “Independence Day”).