What the internet moguls have in mind for Tinseltown

Convergence culture:Two internet pioneers have radical ideas on how to reinvigorate the film business, writes Haydn Shaughnessy

Mark Cuban is a loud voice on the blogging scene. His blogmaverick.com is one of the most outspoken on how the film, music and internet industries are changing. He also happens to be one of Hollywood's newest movers and shakers, and the biggest in terms of what he's doing to the industry. Jeff Skoll is a little less well known, but his films are making a bigger impact than Cuban's. What the two have in common is that they are rich and powerful because of what they achieved on the internet, and they both set out to change the rules of the movie business.

Seven years ago Cuban set about rewriting the rules of what cinemas do. He became a movie mogul and decided to launch his films direct to DVD as well as simultaneously in cinemas and on pay-per-view TV. This simultaneous-release strategy is distinct from the traditional staggered release window, where a film is launched in cinemas, followed by a release to DVD and then to television.

Cuban's plans only came to fruition with the low-budget, Steven Soderbergh-directed Bubble, released in January 2006. That alone, though, was enough to show cinema owners that their place in the movie business carries no guarantees. "Simultaneous release already exists," claimed Soderbergh at that time. "It's called piracy." The director was addressing it head on. Cuban was more motivated by a simple ethos. Movies are a business so you do what works. The traditional movie business is in a rut, with studios doing what they've done for decades.

Jeff Skoll, by way of contrast, followed his own internet success by setting up Participant Productions, a film company that makes the kind of social-conscience movies (George Clooney's Syrianaand Good Night, and Good Luck, Al Gore's An Inconvenient Truth, Murderball, a movie about disability) that Skoll believes will draw people into political participation. Whereas Cuban attacked the structure of the industry, Skoll has set about changing the nature of the stories that get told.

To supplement Participant's film-making (the company has an executive vice president responsible for social action and advocacy), the firm also runs participate.net, a social-action website with links to campaigns on the environment, the food industry, disability and the other issues that Participant addresses in its movies.

Cuban's release strategy has a lot going for it, as long as you don't own cinemas. He says that he made twice as much as he expected from DVD sales of Bubble. A recent report on the future of cinema written by researchers from Germany ( The Last Picture Show? Timing and Order of Movie Distribution Channels) concluded that releasing movies in all media simultaneously in the US would reduce cinema revenues by 40 percent in the US but would increase cinema revenues in a European country such as Germany (the impact would be felt by DVD rental chains).

On the future of the cinema, Cuban is right to conclude that there will be an inevitable contraction in the number of movie houses if Hollywood studios follow his business strategy, but he says that cinemas will not only survive, they will also change their character.

"I think people are becoming more critical in what they expect from theatres," Cuban told me recently by e-mail. "Adults want to go to theatres that appreciate how they want to see a movie. Which is feed me, give me drink, let me watch. Young adults and teens have their own way of seeing a movie. They want to text, socialize and interact."

What draws the younger audience might well be some kind of movie and cinema-going experience we've yet to encounter. It will include an opportunity to use their mobile phones and it will have relevance to the online networks they've joined (Bebo and MySpace or the hundreds of others that are now sprouting on the Web). The development of digital cinema also means that ultra-modern movie houses will be able to switch their film portfolios easily and quickly.

Participant has taken less of a challenging line with the movie-business model, preferring instead to focus on the content and purpose of films. Its mission is to make the world a better place.

So who are these men and where did they come from? Cuban began his professional life running a company that integrated IT systems. He went on to co-found AudioNet, which later became broadcast.com, an internet broadcaster bought by Yahoo just before the dotcom crash. Cuban is thought to have earned $5.7 billion in Yahoo stock from the sale. Skoll was a co-founder and the first president of online auction house eBay, valued at $1.9 billion when it went public in 2002. Two similar backgrounds, two big steps for the modern movie-making world.

WORDS IN YOUR EAR

Release window -the practice of releasing movies first to cinemas, then to DVD rental, then for sale and then to television

Simultaneous release -releasing movies to all formats at the same time

Social networks -websites that allow members to create their own mini-websites and to interact with friends through them