We need to move to a future where people can pay to watch the movie on their TV instead of paying to get a ticket at a theatre.

Eeek - no thanks! I'd like a future were we can do the former as easily as the latter - but absolutely not instead. I have a number of reasons for this:

1. I love watching a movie in the theater. I know, adverts, overpriced popcorn, sometimes the person in front is too tall or the person in back keeps whispering, but I like sitting in the middle of a crowd that gasps or laughs in unison, and I particularly like seeing the film on a creen bigger than my house...

2. ...because when we make movies, we at least try to have them look good that way. It's supposed to be all-enveloping and ridiculously bigger than life. TV diminishes movies: reducing them in size robs them of much emotional impact. And it is our big fat emotions which we wish to impose upon - er, share with you, the viewers.

3. if you've made a film and got it into an important festival (the kind that buyers show up to, rather than just film buffs), then the reaction of a full-size audience sells the film better than any private screening possibly could. So it's more likely to sell, and for more money. And we crave your money almost as much as we crave your adulation. More, in some cases.

4. Seriously, we need the money. People have this image of the film business as being full of greedy executives and pouty stars, but that's like saying everyone in the software industry is like Steve Ballmer or Larry Ellison. The vast majority of people make a much more modest living. If you want to make your own films, that's pretty expensive so you usually have to beg other people to lend you the money.

5. If you're not in a festival but you know what you're doing, you can rent a theater relatively cheaply and screen your film there. For some kinds of material this can be an effective sales strategy - and it may be much faster and cheaper than trying to persuade a distributor by renting a tiny stand at a film market...

6. ...and you need a distributor, because it's bloody hard to get your movie into Netflix's catalog otherwise, and Netflix is the 800 lb gorilla of DVD rental. You can also put a movie on iTunes, but it turns out that not that many people want to rent their movies that way and I'm told by distributors that having your film there isn't worth nearly as much as on Netflix.

7. Of course you can self-distribute, but it's very hard to make money this way. You could give it away free on the net, but your return on paypal donations will be pretty minimal. I very much liked the idea of TipJoy, but as you found yourself it's hard to build a business model around micropayments. It's even harder if you're trying to share revenue with a CDN that can offer decent streaming.

Don't get me wrong, I'm all in favor of streaming and other methods of web delivery. In some senses it's easier to market your film than ever. But as film becomes more of an on-demand commodity rather than something people get up and go to (as in theaters), building a revenue model becomes very tricky. It's far cheaper than it used to be to make a film, thanks to technology, but it's still a tremendous amount of work, and as I said elsewhere you can't iterate - when someone decides to watch a movie, they want a finished product that runs for 80+ minutes, and that's quite a bit of work to put together.