The cinema is in the midst of another crisis. The talk is of a quarter fewer cinema tickets sold this summer, although economic statistics put the figure at ten percent. The key position in the story of the audio visual market has been staked out by the DVD. In its ten year lifetime as a mass product, it has proved to be more that just a faster, handier and more luxurious data storage format for the usual image flux. The days of projectors and film rolls seem to be over, the cinema of the future will be plucked out of orbit via satellite, digitally projected and stored on a wee silvery disc. And as is their wont in times of upheaval, apocalypticists, opportunists, hysterics and the nostalgically challenged will talk their talk and rage their respective rages.

After all, say the opportunists, the cinema is an institution which learns and grows stronger from its crises, and things that have been given up for dead, live on anyway. The cinema, say the apocalypticists, has become idiotic, evil and tasteless enough to finally call it a day. Cinema will never die, say the nostalgia sufferers. After all, the circus, opera and literature haven't died yet. A bit smaller, they add, less money and more soul would not be such a bad thing anyway. And the hysterics see the next semiotic catastrophe appraoching, the worst case scenario for the world of images – when they lose their place, what ghostly paths will they take?

There are as many good reasons for the crisis of cinema as there are for the rise of the DVD. Some of them are as trivial as they are irrefutable: high ticket prices, wrong films in the wrong places, a generation change in the audience, the hysterical anti-pirating campaign which has turned the viewer into a potential enemy rather than a welcome guest, and the rapid loss of glamour through the Cinemaxx multiplexes.

The advantages of the DVD are equally easy to pinpoint. For the price of a cinema ticket, I can get a film which I watch when I want and with whom I want. The technical quality is, in contrast to the old video format, so good that I can set up my own private cinema, where I am projectionist, programme organiser, audience and to a certain extent director. DVDs are excellent performers with high consumer appeal, and they are also flexible enough to jump from home cinema to laptop and let you do anything you want with them. DVDs sell with "Extras Bonus! Special Edition!" When a director makes a film intended as a regular feature length, he has to promise to make a much longer and better DVD version at the same time. And we haven't even started on the possibilities of legal and illegal copying.

But if that was everything, you could probably sit back and watch as the industry picked up again after a year or two of crisis, could believe that a new generation of cinema goers will come along, prepared to pay the appropriate ticket prices for real attractions. Perhaps the unending competition will give rise to new technologies a la Imax or 3D which can at least of give it the technological edge. DVDs will lose their novelty value, the expensive extras will fizzle out, the desire for entertainment away from the sofa will be stronger than the lonely ambitions of the collector? Won't it?

But let's assume for a moment that the crisis bites deeper this time, that it's not just a passing or cyclical crisis of the aesthetic economy but a structural, perhaps even cultural crisis of perception and narration. Many indicators point less to a crisis of cinematic film but of a particular way of showing it in a particular location. Of all examples of urban architecture, the multiplex is probably the least compatible with the disenchanted days at the end of neo-liberalism. When they went up, these cinemas were the strongholds of technological optimism, defiant fist thumps of amusement in already shrinking cities. Their provocative refusal to go soft, their radical anti-aesthetic was perfect for the time. Multiplexes promised the ultimate film experience and a cultural don't give a damn.

Their coldness, their showiness imitates a factory, an administrative building; it signals an unfriendly parallel world more than a place of cultural contact. The bland hysteria and the put-on affability of the more or less informed personnel, the penetrating smell of popcorn, detergent and dissatisfaction. Nothing seems to contradict the longing for warmth and companionship more than a multiplex. When you look at it the other way round, at the films the remaining small cinemas rack up their turnover with, it becomes clear that what people want are places where they feel connected, where they feel emotional warmth. In the tales of weeping camels and Buena Vista Social events we experience an inkling – albeit somewhat illusionary – of the old cinema joy – a story telling community.

In a Germany of rising unemployment and working poor, the multiplexes have become places of discomfort - also because their architecture promised an independence and a power of imagery as a false as any promise of recent modernism. On the business front, cinema has long since lost the upper hand. Four years ago the computer game branch topped the film industry's turnover for the first time; for image circulation, TV can react more directly and with greater mass penetration; Internet connects us quicker to the global village and our superstars are more likely to come from the tabloids than from the cinema.

Obviously cinema has nothing up its sleeve to counter this situation. Strictly speaking, it no longer produces its own pictures and it doesn't "hold on" to them any more. Soon cinema will neither need a room nor a carrier in the form of "film". It won't need a filming apparatus which imitates the human way of seeing, or a narrative structure which follows the linear code of a novel. But none of this is the fault of the DVD. After all, technologically ambitious image making has always developed in two complementary and competing paths: as overwhelming presentation in a public space and as private appropriation. Just think of the competition between cine-film and CinemaScope, video and cinema centre, DVD and multiplex. But at the same time the images in public cultural domain started having to compete with radio, TV and Internet in the private domain. The competition between cinema and DVD is, in other words, not a new phenomenon but a new expression of this old duality.

One thing is new, and that is that "media multiplications" have added salt to the old competition. The marketing of a blockbuster films attempts to occupy as many media as possible - cinema and DVD, TV, comic and T shirt - while the film competes to the bitter end with other projects of similar dimensions. Basically this all comes down to a battle between different copyright systems. The multiplication of terms, images and stories in various media is replaced by the work on the creation of a single, boundless, polyvalent mega-medium.

The successful image is therefore the one which can leapfrog over all the differences of the media, the image that is at once comic, film, computer game and TV fodder, the image that melds all media together. It could be that the cinema as a location goes against the very concept of the fluid image in its new globalised form.

But how is cinema reacting, how are its makers and moguls responding to this liquification? With astounding primitivism. They are fixating on the production of overpowering images that fill people with wonder at their technological muscle-flexing but nothing more. The most recent example is the Imax cinema which shows "images never seen before". But there are no stories that can be told in this format except wild geese and space travel.

So the situation of competition has only mixed more elements of the "marvelling masses" into the film audience. But once you've seen your third 3D arrow hurtling towards you, you don't need any more. For a brief moment of hope, it looked as though computer animation and its potential for making films of comics, might be able to reconcile the old story public with the marvelling funfair masses in the multiplex cinema. But within five years, the mix separated again, the marvelling masses popped their heads into the Imax cinema and the story community huddled around the DVD, a medium with cult status. On the silver screen, it is more obvious than on a liquid crystal screen at home, that the spatial problems of linking computers with real images are unsolved or unsolvable. So cinema became homeless, even on the big screen.

And it continued to work hard at its own dissolution. Newer productions always budget two or three days in which documentary film makers can busy about the set, making a "making of". By producing this reportage the films effectively create their own shadow images, which mediate an endless circling of visual story-telling as well as a distance from the content. A film made for DVD is never complete, because it can always be altered with new material, extended and embellished (it's the spectator, after all, who puts together the final version) and, with the various side and background stories, it effectively dismisses its own commentary. Thus, the film on DVD subsumes its own critical reflection in other media, it even contains its own audience response: all the babble about the film. On the one hand the medium imitates "social practice", on the other, the aesthetics of its one-time competitor, TV - no violent action blockbuster without additional material and chit chat, like in TV.

Noam Chomsky accused the media of serving to manufacture consent. This accusation is severe, when one brings it to bear on the aims of enlightenment, democratisation, emancipation, even art. And it is more severe still when one thinks in whose interest and within what structures this consent is produced. In this production of consent the world becomes the market and the market the world. But has anyone every considered what would happen if the media did not manufacture consent? Society would fall apart before our very eyes, and not in marvelling masses and story communities, in apocalpticists, hysterics, those who've adapted and those who are nostaligic, but in blinded hordes, confused children, crazed sectarians. This is why even those who haven't stepped inside a cinema for twenty years, fear for its demise.

Perhaps we all sense that one of image's very first homes could vanish – just as the greenback frog, the theatre and the conjunctive have begun to disappear. Because it is highly unlikely that the unstable, self-referential, and process-related DVD images or even the fully virtualised images of the computer network, can create a perceptional consent capable of understanding itself.

Cinema crises and DVD fashions are symptoms of a visual crisis of confidence. This can be seen positively. Any one who no longer trusts images tries, as much as possible, to control them as much as possible. The consumer reacts to manipulated images by trying to manipulate them himself. He reacts to the collapse of narrative communities by turning - with varying degrees of fanaticism or irony - to virtual narrative communities. He reacts to the liquification of images with a new obsession for collection. But is the image pinned down when you own it? And inversely, is it "democraticised" or at least open to general plundering when it flows through the net and is only "produced" in the living room when "control", yes even responsibility, is transferred from producer to consumer?

Every crisis brings with it opportunities. The opportunity represented by the crisis of cinema lies in the expected renaissances after the fall, in the stimulating side effects of further dilapidation and aesthetic subversion. But the opportunity also lies there where the medium DVD has yet to be used and exhausted, in its potential for reflection, it invitations to work with the images and on the images. We and the cinema must first conquer the DVD as a medium which serves the furthest peripheries of image production as much as the centre, the dissidents as much as the mainstream. Then, some time, cinema might be able to reconquer itself.

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This article originally appeared in German in Die Zeit on July 28, 2005.

Georg Seeßlen is one of Germany's best regarded film critics and author of several books on cinema.

translation: lp