Hollywood faces big challenges from the digital age, and so far it's been unwilling to meet them head on. Instead, the studios have preferred a strategy that has them working a very 20th century business model in a 21st century world.

What, if anything, will save Hollywood from the P2P menace? iTunes and the video iPod, according to a few. Ask others and you'll hear Bittorrent (if those others you ask are Warner Bros. executives). Still others are convinced that Hollywood won't win out unless it offers choice, ownership and the ability to easily play downloaded movies on your home TV.

For sure, what has been done so far doesn't work. Prosecutions and P2P awareness advertising have been less than successful, it's time for new strategies.

Hollywood seems to be awakening to the challenges of a digital world. Warner Bros' recent deal with Bittorrent, if taken at face value, is a strong sign that Hollywood is looking to make a change. The BBC has a feature article today on what Hollywood is doing, and it contains a few surprises.

Not the least of the surprises is the vitriol of Richard Dreyfuss, who says, "the guys who started this business all cheated somebody to get there, and now they're being cheated, perhaps, by all these crazy, geeky people all over the Internet.", he continued, "I must say, my anguish level is not great."

For now, expect heavily DRMed digital releases as the norm. You may be able to download movies legally, but you still face an uphill battle to use them the way you wish.

[via BBC]