It’s an interesting chapter for traditional media these days, where the advent of iPads (assume, if you will, that they will be “broken” or hacked to allow unlicensed or un-proprietary content), Boxees, Hulus and Netflix Streaming continually tests the ability of mainstream media to expand its price and library footprint.

Whether it be buying a big library like MGM (post-Sony/Comcast) or Miramax (post-Disney), the real value studios or private equity see in these sizable libraries is the money they will throw off in terms of license deals. Basically, 7-year “ultimates” - i.e., revenues from the many license windows of distribution.

That this money is now pointing more to more at the lower revshares of the iTunes/iPads/Apple TVs, YouTubes and Hulus reduces the overall payloads and valuations considerably.

It’s almost like adjusting for “technological” inflation. Will the studios adjust?

Questions have to be asked: Can the studios keep their accretive acquisitions and productions at the rates they are by adding staff to their digital distribution divisions? Will digital growth eventually narrow media losses, vis-a-vis by distributing content more intelligently in the primary traditional windows, followed by smarter delivery to digital windows?