
Anthony Kaufman of Indiewire wrote a great story today on indie digital rights. I was pretty pleased to be included in the story in the company of folks like Liesl Copland of Netflix, Robert Nathan of Cinetic, Jason Janego of Magnolia, and Lisa Schwartz of IFC.
Most people agree that digital distribution will become the most dominant form of media consumption in the not too distant future. Where people tend to diverge in their thinking is just how distant that future is. And where they diverge even further is what to do in the mean time.
The big technology players (Netflix, Apple, Microsoft, Amazon) are investing (read: losing) a ton of capital under the (correct) assumption that they can’t afford not to. Whenever we reach the promised land, if they’re not already there, it will be too late. To be fair, Google (YouTube) is definitely making money, but in a different space (short-form vs. long-form). And even Fox & Universal are now in the mix with Hulu (they are private, but unlikely to be making money yet).
With close to 60% of the total market, Apple today is still the 800 lb Gorilla. But to put that in perspective, last year they sold only 7 million feature films on iTunes. At $9.99 a pop, that’s less than $70 million. Which is less than than the opening weekend gross of I Am Legend - last year’s #6 grossing film. Which means the whole market is roughly $117 million, or less than the opening weekend of Shrek the Third - last year’s #2 grossing film.
So what does this mean for filmmakers? That for the foreseeable future, digital distribution is still experimental. To put it another way, don’t put all your eggs in one basket.
Currently, the various models include download-to-own, such as iTunes, or subscription-based, such as Netflix. In the age of “freeconomics,” however, as outlined by Chris Anderson’s March 2008 WIRED cover story “Free! Why $0.00 Is the Future of Business” (link), “the trend lines that determine the cost of doing business online all point the same way: to zero.” The most successful future model, then, could be simply to give the movies away.
That’s at least what Hyams’s B-Side has been doing in theaters: B-Side has been promoting over 300 free screenings around the country for their most successful title, the music documentary “Before the Music Dies,” in the hopes that it will drive online sales.
[…]
“I don’t believe there will ever be a time when you can just put your movie online and make money,” said Hyams, who believes that a cross-platform approach is integral to getting movies watched and purchased.
At B-Side, that means that we spend most of our time and energy on innovative (we think) approaches to marketing — eg, check out what we’re doing with Super High Me. And we spend the rest of our time and energy on partnering with distributors to pair online distribution with offline outlets — eg, our partnership with IFC.
I do believe the first pure-online million-seller will happen in the next year. But it will likely come from a movie version of Radiohead’s In Rainbows experiment — ie, a known-entity with established brand taking a great film and making it available online only.
The keys there are a) established brand, and b) great film. One thing people often forget is that while digital distribution absolutely does reduce friction in the system, it can’t make something bad turn good. In fact, I believe the online world is more Darwinian, drawing a sharper line between “good” and “bad.” This is true for two key reasons:
- Audiences are no longer captive. When massive selection and on-demand availability becomes a reality, why would anyone bother spending 90 minutes on something that doesn’t resonate? If I’m bored, I’ll just fire up something else.
- Viral can mean life or death. Word of moth travels fast for things that are great, and faster for things that suck. This is one that people tend to forget / ignore. The only things that benefit from buzz are the ones people love. You can’t manufacture true buzz.
So, not really big news that the future is uncertain. But Kaufman’s story is a great view into what some of the indie players are thinking and doing.
You can read the full story here.