I recently posted on our Facebook page a note about the fact that one has to be mindful about when to initiate a NETFLIX VOD window. Sheri Candler asked to me blog about it. I do everything she says.
We have heard consistently from Cable VOD operators and aggregators and Broadcasters such as Showtime that the Netflix VOD window is considered a cannibalizer of revenue for Cable VOD and TV so know that before licensing rights and resolving windows. When it comes to Netflix they have gotten so successful that they are a more selective platform than Amazon. Amazon wants has recently passed the 80,000 titles mark and is racing to aggregate as many as possible. Netflix has over 100,000 titles on DVD and over 17,000 titles on its streaming service but is now getting more and more selective. Netflix SVOD rights are sold for a flat fee, at least for now. To get onto Netflix, first one has to get on their radar and into their system, and then get that demand up in their queue system to get a good fee offer. One has to then resolve everything else before risking inadvertently killing any chances of a Broadcast sale or Cable VOD distribution. However, depending on the film, you may make more money from Netflix than by selling to let’s say EPIX which will want your Netflix SVOD rights anyway. And you may make more money distributing directly then doing a small Broadcast deal or going with a distributor or aggregator that will take all your digital rights anyway. Though it should be noted most filmmakers cannot get to Netflix directly.
As with anything in film distribution, there is no one rule that applies to all films. This is a case-by-case business. Some films are big enough that one can stagger windows and monetize them all. Some films are better served by being available on all platforms at once or close to it. Some films lend themselves more to rental or ad-supported free-on-demand and others can really generate the transactional (pay per download) business.
The point of this little missive though is just to note the conflation of TV and the Internet is happening. Google TV is here and retailers, Television and device manufacturers, cable operators and telcos are all competing to aggregate and offer as much content as possible. Even print media companies are following suit wanting channels of content on their websites. And soon enough it will be less a discussion of rights and more a discussion of PAYMENT METHODS or MONETIZING METHODS and I think that will always depend on the film and its demographic targets. The options will always be: 1. Ad-Supported / Free on Demand, 2. Subscription 3. Pay Per View 4. Download to Rent, and / or 5. Download to Own. And now instead of focusing on packaged media the focus is is on whether one can play content back on as many devices as one wants and that aspect related to all the various payment methods options. The content providing industries are all racing to aggregate as much content as they can and for it to be playable across as many devices as possible and payment methods vary so far depending on service and distributor choices. Hulu (a platform backed by studios and that was once only ad-supported is now beta testing its Netflix imitation subscription model).
Brands will attract customers just like they always did when video stores were king and just like when you choose which cell phone provider to use or whom to get your Internet connection through, assuming you live in an area with choice.
The other day on a Digital Hollywood Conference panel, I learned a stat from Erik Opeka of New Video: iTunes has 130,000,000 credit cards on file. Some of you are thinking right now, “I’m in the wrong business”.
Orly Ravid October 21st, 2010
Unfortunately, a great number of key digital platforms must be accessed through the use of an aggregator. Of course there are always exceptions, but the general rule is that to get your films onto Cable VOD, iTunes, Netflix, Hulu, Sony Playstation and other device oriented options and retailer digital platforms , you will have to go through an aggregator or a distributor. We either directly or via partners offer both a commission or a flat fee option (range depends on platforms).
However, you can get onto Amazon directly. Also, you can access DIY oriented ones such as Mubi, Fans of Film and other platforms like them. To the best of our knowledge, more money is made on the key high trafficked platforms, if one can get on them.
Once again we remind you, MARKETING, MARKETING, MARKETING is key to your film’s success no matter what distribution outlet you use.
This concludes our series of tidbits for the time being. As always, if you have questions or need guidance to figure out your film’s distribution path, we would love to hear from you. No rights taken.
Orly Ravid August 27th, 2010
We all struggle with this, filmmakers, distributors alike. I remember giving a presentation to distributors about digital distribution and theatrical came up. I talked about the weirdness of showing a film 5 or 6 times a day to an almost always-empty house save a couple showings. This makes no sense for most films. When I released Baise Moi in 2000, we broke the boxoffice records at the time, and the “raincoat crowd” did show up at the oddest morning hours, but that is the exception, not the rule. Not every film has an 8-minute rape scene that just must be seen by post-punk-feminists and pornography-lovers alike. It’s an odd set-up for smaller films and it’s not the only means to the end we are looking for.
Recently, The Film Collaborative released Eyes Wide Open in NYC, LA, Palm Beach and Palm Springs. We have a little over $10,000 (all in it will be about $12,000 tops). We have made our money back and the great reviews and extra marketing / visibility will drive ancillary sales but we also did not invest or risk too much as you can see. That is a great formula (one that small, disciplined and seasoned distributors such as First Run Features, Strand, Zeitgeist, employ) but it is not viable for all films. First of all we have an “A” list festival film (Cannes & TIFF & LAFF) and second it caters to two or three niches (gay and Jewish/Israeli) though one can argue that the niches also slightly cancel each other out to some extent, the film did well so obviously the campaign worked.
But there are many films for which that strategy would not work. Either theaters could not be booked, or reviews would not always be great, and / or the film would simply not galvanize a theatrical audience. Plus, once you start adding up 4-Wall fees, the bottom line leans more likely to be shades of red. The Quad Cinema sent an E-blast promoting its 4-Wall program. It was a good sales pitch and I am not going into it all here, but the take home is that you’re more likely to get a broader theatrical, and/or a distribution deal, and/or picked up by Netflix and other digital platforms if you open theatrically in New York. I would argue that is true to some extent but also VERY MUCH dependent on the FILM itself and there should still be a cost-analysis and overall strategy consideration before one pays the Quad for their services and hopes for the best. Here is a link to the info and we are happy to email the blast to any who request it www.quadcinema4wall.com . It should also be noted that generally speaking, The New York Times does not consider your film among “All the News That is Fit to Print” unless it’s opening wider than just New York.
So how to decide? Companies such as Oscilloscope are all about theatrical, but they pick their films carefully and my guess is Adam Yauch can afford to lose money too if it comes to that. Home Video companies such as New Video, and Phase4 are doing some theatrical, but on an as-needed basis and yes, to service the ancillary rights, but that’s a very experienced analysis on their part. When we posted on Twitter about the Cable Operators warning they will start requiring a ten (10) city theatrical, all at once, believe me, if everyone blindly follows suit, the bar will get raised even higher right until we all go broke. The point is to mitigate the glut and distinguish films in the marketplace not get us all to be lemmings and empty our bank accounts. There is math to be done and I know it’s hard without all the back-end numbers at your disposal, but they are coming. We will publish case studies of all our films and we encourage you to get down to the detailed back-end numbers analysis before spending more on the front end and often gratuitously.
We have experienced and heard about the impact a filmmaker can have in his or her city when working the film and then really impacting the gross and that is inspiring, but usually not long-lasting because it takes a lot to get people to pay to see your film in a theater when there are so many other films and so many more marketing dollars behind them. And what’s in it for you? The only reviews that matter are the big ones and we all know what they are… and remember what we said above about The New York Times.
The general perception of indie film releases is interesting. Most don’t take into account the money that is spent to get the “gross”. More of the time the distributor (or whomever booked the film) gets less than half of the box office revenues. Sometimes as little as 25% – 30% though of course sometimes more. And there are the expenses. The Kids Are Alright may not even be in the black right now, but you’d never know that reading certain coverage. I love Exit Through A Gift Shop and actually flagged that release as a stellar release and then I learned that the marketing spend was actually a lot more than I realized such that the spend may be up to a million dollars. I don’t actually know, and not sure anyone will tell me. I do know that the bottom line for many of The Weinstein releases was reported to be in the red because of spending. If you have a film that can sell a lot of units and especially in an evergreen manner, and if you can trigger a great TV sale and if you have foreign sales legs, then there’s a real upside. If you don’t, then be clear what you’re goals are. Sometimes it’s just a career move and that makes sense. Canadian filmmakers need a theatrical release to get their next projects funded (say that like this: ‘pro-jects’). Sometimes people just want the awards qualification and that’s another ballgame.
We have written some of our TFC Distribution Tid Bits about Hybrid Theatrical and Marketing options, but here is a bit more on the topic:
If creating buzz is what you want, you don’t need a traditional theatrical and you definitely don’t need to overpay for the privilege.
Some OPTIONS – try HYBRID THEATRICAL – do FILM FESTIVAL, CREATE EVENTS, HOLD A SCREENING WITH ORGANIZATIONS, show in MUSEUMS (in some cases), other ALTERNATIVE VENUES depending on the film, and also there are all sorts of ways to book a few days here and a few days there at theaters (we cover that below). Theaters are and will continue to do this more and more. AMCi announced their intentions and they are still in the marinating phase, but we know you’ll all be ready when they are.
We’re interested in these companies and services:
- Cinedigm: They have a program in the works that is meant to be similar to ScreenVision and Fathom (which is no longer handling indie films generally speaking, as far as we know) but aimed at independent cinema, and working with all the big theatre chains (Regal, AMC, Cinemark). I asked them to write a few words for me about themselves and their plans: Cinedigm Entertainment, a theatrical distributor, has built several “channels” of content for movie theatres. This is niche content that plays at what is traditionally slower times for the theatres. Examples are; Kidtoons a monthly matinee program; Live 3D sports, like the World Cup and NCAA Final Four basketball; and 3D and 2D concert films with artists from Dave Mathews to Beyonce. For each “channel,” the most appropriate theatres are chosen and theatres sign on to play the content as a series, thereby creating the expectation in the marketplace for the next installment. In the company’s newest “channel,” it looks to apply the concept to indie-films which will provide filmmakers with the theatrical element for distribution.
- Emerging Pictures: Owned by Ira Deutchman (now also a Film Prof. at Columbia University). I spoke with Joshua Green, whom I have known for a while and booked with, though no real revenues were made in the past, their latest network of theatres sounds potent. They connect up to 75 theatres and they do very well with Opera, Ballet and Shakespeare, but also indie films. They work with all the usual indie film distributors either taking on 2nd run of films in major markets or handing the first run in secondary markets. On screen now for example is Mother & Child, My Name is Love, and Girl with a Dragon Tattoo. 30% of the Gross is paid to the distributor or filmmaker. They charge usually a 1-time encoding fee to get the files needed for the theatres. The fee is $1,000. If that’s an issue that can sometimes in advance to make sure the bookings will happen to make the fee worthwhile. They create a Hi Rez file 720p VC1 file which is a professional HD version of MS Windows. They work with the Laemmle theatres in LA and Sympany Space in NY and lots of others across the country. What does well on the Art House circuit will do well with them I was told. Makes sense.
- Variance Films: Dylan Marchetti (former exec at Imaginasian and Think Film) is a firm believer in Theatrical and it’s his business. He may promote its necessities a bit more than I will and its not his money to spend and he was honest about the range of success (meaning not all films work theatrically and sometimes money is lost, and we know of at least one example, but it happens). We spoke for the first time and I was comforted by his grassroots approach (they do that work themselves) and his commitment to alternative low cost venues: event screenings, niche-specific / lifestyle specific venues, as well as traditional theatres (all the usual chains and small theatres etc). He noted that generally speaking, they do not charge more than $50,000 and that they get paid via back-end fees only. He said a release in NY and LA for $20,000 can be done. Variance is not a believer in print advertising; they have to believe in the film to take it on; and Dylan said that there is no correlation between P&A spending and a film’s success. Amen. They don’t do PR but rather refer out to outside agencies, as does The Film Collaborative. NB: Dylan Marchetti of Variance makes a correction to this. “Fees vary wildly depending on the film and release”. So sometimes they can do backend tied fees only, but not always.
The Film Collaborative is theatrically releasing UNDERTOW (which won the World Cinema Audience Award at Sundance). Stay tuned.
Orly Ravid July 28th, 2010
Tags: 4 Wall, Adam Yauch, Alternative venues, AMCi, Cannes, Cinedigm, Dylan Marchetti, Emerging Pictures, Exit Through the Gift Shop, Eyes Wide Open, Girl with the Dragon Tattoo, Hybrid theatrical, Ira Deutchman, Joshua Green, Laemmle, LAFF, marketing strategy, Mother and Child, My Name is Love, Netflix, New Video, New York, Oscilloscope, Phase4, Quad Cinema, Sympany Space, The Film Collaborative, The Kids are Alright, The Weinsteins, theaters, Theatrical, TIFF, Undertow, Variance Films, VOD
Every filmmaker wants a theatrical exhibition for their film because of the prestige and the classic appeal. Key, in our opinion, is to know what’s possible and what you’re paying for. There are lots of services that charge big fees to book your film. Be knowledgeable about when you can book yourself (Landmark, Film Forum, Quad, Laemmle Theatres, Cinema Village, lots of others), or spend less on theatrical.
Publicity is the most important part of theatrical and that’s what you should spend money and time on. A New York Times review is usually a key goal, and it won’t come from having just a NYC release (that’s new NYT policy). A Theatrical release is important to directors for the obvious reasons and it is a very useful marketing component, but the operative word is “useful”. It’s useful only if it does not cost you more than you’ll make back from it and ancillaries that are enhanced by it.
According to one of our VOD partners, Comcast and InDemand have said, off-the-record, that they will start insisting on a 10-city day & date release for films to have access to their service. This policy would be implemented to help sift through the glut of the content in supply. We caution, before filmmakers rush into that spend, to think whether their film is likely to make it onto key Cable VOD platforms. Will the spend on theatrical likely be recouped on VOD? Also, cable VOD wants day and date releases, but theatres don’t so be cautious when planning your distribution route.
Are you a filmmaker who has worked with a distributor or service company for theatrical exhibition? Tell us about them in our Distributor Report Card.
Orly Ravid July 21st, 2010
Tags: Cinema Village, Comcast, Distributor Report Card, Film Forum, InDemand, Laemmle's, Landmark, New York Times, Quad Cinema, The Film Collaborative, theatrical distribution, theatrical exhibition, VOD
Cable VOD likes films with a theatrical profile. VOD is very marquee (name) driven and genre driven. Its marketing effort is limited, hence the need to have films with a recognizable name in the marketplace or with recognizable “stars”. Regarding Day and Date, cable operators like to note that the film is in theatres while it’s on VOD. In the past, Comcast had asked for a 90 – 120 day window ahead of all digital distribution, but is now sometimes doing Day and Date releases. It depends on the film, the platform, the distributor, and the campaign.
Orly Ravid July 6th, 2010
Windows are a reference to release windows, the prescribed time gaps between which films are released in different media. Make windowing deliberate rather than confusing the customer with scattered pricing in different formats and releases.
The preferred release schedule should be: Cable & Satellite VOD; then Transactional; then Rental; then Ad-Supported platforms; then Mobile/Wireless. In the next tidbits, there will be examples of each of these platforms.
Orly Ravid July 5th, 2010