Queer Duck: The Movie, originally conceived as a webisode on Icebox.com has found its way to DVD release. © Paramount Home Video 2006.

Digital Downloading
While securing mainstream DVD distribution for a compilation release is a significant challenge, perhaps an even greater barrier to growth in the DVD compilation market is competition from alternative digital technologies. Many purveyors of short films, whether film festivals, studios, online animation hubs or independent creators, are signing deals to get their content into the mobile space and onto portable entertainment players such as video iPods.

For example, the Sundance Institute and Sundance Channel announced they would distribute about half of the shorts from their 2007 film festival through iTunes for $1.99 each, while Aardman recently announced a deal with Player X to distribute Wallace & Gromit, Angry Kid and Creature Comforts on mobile phones in the U.S. In the U.K., mobile phone company O2 has a dedicated Aardman channel featuring made-for-mobile animated shorts.

"The question is, if you can consume shorts on the Internet or your mobile phone, do you want a DVD as well?" says Clarke, who notes that Internet content often is supported by banner ads or pre-roll sponsorships, meaning consumers can access it at no cost. He says Aardman has experimented with ways of differentiating its DVDs from other digital content, such as with on-disc extras, sound chips on the packaging and bonus postcards. Because of the specialty distribution, he notes that it is possible to pack in a lot of added value and retain a strong price point. Aardman also is considering the possibility of holding back some content for DVD-only release, at least for a certain window.

Consumers initially seem to be willing to try watching short animation over mobile phones and iPods, and they like the flexibility of being able to choose which films to watch, as well as the ease and convenience of downloading. But only time will tell whether these technologies (and other future technologies) will replace DVD as viable distribution platforms for shorts. Some users may continue to prefer the quality and the extra features associated with DVD.

"I don't yet see [DVDs and other digital channels] as conflicting," says May of The Animation Show, which has partnered with Mobifest LA in the mobile space and has a deal with iTunes. "But two to three years from now, we'll really know."

Karen Raugust is a Minneapolis-based freelance business writer specializing in animation, publishing, licensing and art. She is the author of The Licensing Business Handbook (EPM Communications).