The takeaway I have from this is that if hollywood chose to embrace this sort of thing, they would solve distribution costs (seed vs host). Their cost will be contained to just marketing and production. Be gone with the archaic contracts and let people get the content when they want it in a way that makes sense for everyone.
The only solution that allows them to compete with pirates is to have one monopolistic mega-corporation that controls all the content, so it can sell it easily without licensing issues. Any new content producers are somehow forced to participate in this corporation. This is even implied by piracy advocates who say "why can't Hollywood just do this"...
But I'm not sure that's really what we want.
Out-of-the-box thinking: what if the tickets to movies were sold in advance of production, like a Kickstarter?
$35 lets you buy the movie ahead of time. A bit steep compared with a dvd, but not by much. (plus whatever other bonuses they threw in).
There is a need for an old, outdated business model, that doesn't benefit the consumer -- and it would appear no longer benefits the industry -- to change.
Consumers want content on demand, without delay, both offline and online. If 'hollywood' as an industry does not accommodate the change in consumer behavior, they will lose to other sectors that do accommodate this change.
Or as Carl Carlson said recently on The Simpsons: "All we want is brand new, big-budget entertainment in our homes for nothing. Why doesn't Hollywood get that?"