4 ms·

It's easy to see why it's like that. For example, there's a market (a country) with 5 players. Each offers you 500 Euros for a run of your long-forgotten movie.

It's easy to see why it's like that. For example, there's a market (a country) with 5 players. Each offers you 500 Euros for a run of your long-forgotten movie. That's 2500 Euros if you got them all to buy it. One of them says they will buy it, as an exclusive, for 5000 Euros. It's as simple as that. I work in this sector (not the business side though) and that's what I see each day. To add onto that, sometimes it's even that one (from our example here) offers you 2000 for exclusive, and that's what you take because others won't buy it, or one or two will. You get the idea.

shmerl 10y ago
I see, if it works that way, it's not good for both end users and creators. Why doesn't it work like this for example? Distributor gradually sells the film, and gets percentage of each sale (and the rest goes to creators). Then creators benefit from using as many distributors as possible, because it will maximize profit in the long run. If they are just paid once by the distributor, then sure, they can't rely on potentially growing amount of sales over time. In case of games it works like I said above. And in case of music it can work that way too. So why not for films?
- Keyframe 10y ago
  There are various distribution methods and even new ones being explored. It's a layered issue with a lot of caveats. I'll try to explain the problematics of it. What you have described essentially exists now with video-on-demand (tied with IPTVs usually) that have, essentially, displaced brick and mortar video rentals. It's more of a case of you getting percentage out of them then they out of you. That's due in part because of large user bases and monopolies. If you want viewers to rent or buy your stuff you have to go to the larger players, and they are aware of that. There's another issue at play here, in contrast with games. Films and television programmes have a life cycle that is usually tied to initial theatrical or television run and that is decoupled from its life in rental and buying later on. Both business lives of a movies don't even have to be tackled by the same business entity/owner. In order for a film or series to live through direct sales it needs marketing or very strong brand recognition (and even then marketing). Most films do not have that. Most rights holders hold more than one film too. For a successful rental/vod/buying there needs to be marketing effort and in order to mitigate that industry has devised film channels and specialised channels that run stuff you might be a part of. That way, all of marketing is concentrated on channel's programming and stuff is pushed onto that. Trouble is, those channels do not like if stuff is also available on vod that isn't theirs. Another trouble is that rights holders do not like to sell one movie at a time, it's not viable. Usually, what happens, is that rights holders know they have a strong movie and package several weak ones with it in order to push sales for those as well. It's also common for a channel to seek for a particular title and they get pushed other content in a package to them, or they want a package, etc. Various permutations of that exists. What happens with vod is that sales are, for the most content, dead. Dumping your catalogue onto a vod renders your sales with channels dead as well. So, it's a bit of a conundrum from which side to tackle the issue at all. Those are just my initial thoughts on what I see each day in that space. It has a lot of intricate details layered below and above that, but it all boils down to the fact that channels render money for your entire catalogue and vod only for a select few titles. If you want to sell your entire catalogue, you go through channels since they buy those great titles of yours as well as packaged crap ones. VOD is a harsh mistress that loves only the pretty ones and you still have to tackle marketing for that by yourself and accept whatever the gods of the vod platform will give you. tl;dr; conundrum
  - shmerl 10y ago
    Thanks for the detailed explanation. But what is inherently different in films as in art form that dictates such convoluted distribution methods? Higher cost of production? Games also can have big budgets (admittedly usually not as big though), and there is some similarity with life cycle too. I.e. there is the initial rapid sales period, when some new game comes out. That's usually when developers get the huge chunk of their sales, and try to recover the cost of production. And also, during this period the biggest effort goes into marketing. Then there is the period of gradual sales, i.e. people who don't buy the game because it's new / hyped, but because they like the genre, discovered it years later and so on (assuming it's a good game, and not some junk that gets forgotten for good as soon as it comes out). Over time such sales can be even significant, but they don't directly contribute to critical expenses recovery. So for games both use cases are commonly addressed through similar distributors, yet for films this somehow poses a problem.
    - Keyframe 10y ago
      That front business scenario is pretty much the same. You have an initial run (with marketing and different venues) and that's it. Difference is in the life after it. It's not uncommon for different companies to buy rights to older films and then do business on top of that. You're forgetting a key factor here. Unlike games sales channels, films and tv shows also have programme channels which are willing to pay for running your old shows. And, unlike vod/direct sales, they tend to generate money for all of your catalogue. You kind of have that with games through those bundles every now and then. Issue is that, with game analogy, those bundle sellers (who upfront the marketing for your old stuff) aren't willing to have your stuff if it's on steam as well. Also, they don't pay from what they sell, but a fixed fee for each run. So, it kind of is like games and isn't at the same time. Namely due to tv channels which generate the most money for that after life. Also, take into account that most rights holders have a catalogue of items which has dead weight in them which they try to capitalise on. Hence package deals and channels wanting or being forced into getting them in order to get hot items. That's, I presume, reason why you see, in games, distributor bundles as well. Business ideas have converged already, apart from tv channels where there's no analogy in games. I'm still waiting to see what will become of widespread and free platforms like youtube where, I am sure, there will be sponsored screenings of certain parts, if not whole, catalogues as well.

shmerl 10y ago

I see, if it works that way, it's not good for both end users and creators. Why doesn't it work like this for example? Distributor gradually sells the film, and gets percentage of each sale (and the rest goes to creators). Then creators benefit from using as many distributors as possible, because it will maximize profit in the long run. If they are just paid once by the distributor, then sure, they can't rely on potentially growing amount of sales over time. In case of games it works like I said above. And in case of music it can work that way too. So why not for films?

Keyframe 10y ago
There are various distribution methods and even new ones being explored. It's a layered issue with a lot of caveats. I'll try to explain the problematics of it. What you have described essentially exists now with video-on-demand (tied with IPTVs usually) that have, essentially, displaced brick and mortar video rentals. It's more of a case of you getting percentage out of them then they out of you. That's due in part because of large user bases and monopolies. If you want viewers to rent or buy your stuff you have to go to the larger players, and they are aware of that. There's another issue at play here, in contrast with games. Films and television programmes have a life cycle that is usually tied to initial theatrical or television run and that is decoupled from its life in rental and buying later on. Both business lives of a movies don't even have to be tackled by the same business entity/owner. In order for a film or series to live through direct sales it needs marketing or very strong brand recognition (and even then marketing). Most films do not have that. Most rights holders hold more than one film too. For a successful rental/vod/buying there needs to be marketing effort and in order to mitigate that industry has devised film channels and specialised channels that run stuff you might be a part of. That way, all of marketing is concentrated on channel's programming and stuff is pushed onto that. Trouble is, those channels do not like if stuff is also available on vod that isn't theirs. Another trouble is that rights holders do not like to sell one movie at a time, it's not viable. Usually, what happens, is that rights holders know they have a strong movie and package several weak ones with it in order to push sales for those as well. It's also common for a channel to seek for a particular title and they get pushed other content in a package to them, or they want a package, etc. Various permutations of that exists. What happens with vod is that sales are, for the most content, dead. Dumping your catalogue onto a vod renders your sales with channels dead as well. So, it's a bit of a conundrum from which side to tackle the issue at all. Those are just my initial thoughts on what I see each day in that space. It has a lot of intricate details layered below and above that, but it all boils down to the fact that channels render money for your entire catalogue and vod only for a select few titles. If you want to sell your entire catalogue, you go through channels since they buy those great titles of yours as well as packaged crap ones. VOD is a harsh mistress that loves only the pretty ones and you still have to tackle marketing for that by yourself and accept whatever the gods of the vod platform will give you. tl;dr; conundrum
- shmerl 10y ago
  Thanks for the detailed explanation. But what is inherently different in films as in art form that dictates such convoluted distribution methods? Higher cost of production? Games also can have big budgets (admittedly usually not as big though), and there is some similarity with life cycle too. I.e. there is the initial rapid sales period, when some new game comes out. That's usually when developers get the huge chunk of their sales, and try to recover the cost of production. And also, during this period the biggest effort goes into marketing. Then there is the period of gradual sales, i.e. people who don't buy the game because it's new / hyped, but because they like the genre, discovered it years later and so on (assuming it's a good game, and not some junk that gets forgotten for good as soon as it comes out). Over time such sales can be even significant, but they don't directly contribute to critical expenses recovery. So for games both use cases are commonly addressed through similar distributors, yet for films this somehow poses a problem.
  - Keyframe 10y ago
    That front business scenario is pretty much the same. You have an initial run (with marketing and different venues) and that's it. Difference is in the life after it. It's not uncommon for different companies to buy rights to older films and then do business on top of that. You're forgetting a key factor here. Unlike games sales channels, films and tv shows also have programme channels which are willing to pay for running your old shows. And, unlike vod/direct sales, they tend to generate money for all of your catalogue. You kind of have that with games through those bundles every now and then. Issue is that, with game analogy, those bundle sellers (who upfront the marketing for your old stuff) aren't willing to have your stuff if it's on steam as well. Also, they don't pay from what they sell, but a fixed fee for each run. So, it kind of is like games and isn't at the same time. Namely due to tv channels which generate the most money for that after life. Also, take into account that most rights holders have a catalogue of items which has dead weight in them which they try to capitalise on. Hence package deals and channels wanting or being forced into getting them in order to get hot items. That's, I presume, reason why you see, in games, distributor bundles as well. Business ideas have converged already, apart from tv channels where there's no analogy in games. I'm still waiting to see what will become of widespread and free platforms like youtube where, I am sure, there will be sponsored screenings of certain parts, if not whole, catalogues as well.