Sunday, March 6, 2011

A Dog In The Fight

Seems the landscape for what you watch and where you watch it is getting more dangerous by the week. New announcements counteracting and contradicting the previous ones fly as different companies are stepping on each others' toes to get to the customers anyway they can.

Comcast and Times-Warner announced their intent to go wide with TV Everywhere, a computer-based streaming service (press release here). They want to stay in the business of delivering the content no one is going out to theatres to see anymore, before Netflix or Hulu figure out how to completely own the space. (The studios are already nervous about Netflix intruding into the lucrative realm of more current programs rather than just those less attractive that are already available on DVD.) About a moment later the AMC and Regal Theatre chains announced their joint-foray into distribution, acquiring independent and orphan films not only to screen on their small under-utilized theatres but to distribute in other venues including video, cable, and any other method of wireless as well. (reported here ).

They've all come to realize the big sexy blockbusters don't assert their presence for very long in the old ways - they may open on over 4000 screens opening week but by the 2nd the gross has fallen 50% and there's a lot of empty seats. No one makes any money showing a movie to an empty seat. Seats don't buy popcorn (nor are they swayed by ads). Filling those seats with indie product, easily portable and translatable to the smaller screens, won't take up too much room and sometimes it plays for weeks - or months - demonstrating and proving the concept of the "long tail" with a minimum of outlay.

Now just last week DirecTV is fighting the old/new model with their own "premium VOD" (here). It's shaping up to be a dogfight and who wins will depend on whose dog is the biggest.

AMC and Regal have both declared they won't play ball with any studios that share their content on DirecTV's VOD model (intended to make films available for as much as $30 as little as 4 weeks after opening in theatres). AMC and Regal insist on keeping the theatrical model intact, in spite of their own dog in the race, their small yapping foray into on-the-fringe distribution of under-the-radar titles, a low-profile attempt to nibble at the crumbs the studios leave behind that can't be ignored.

AMC and Regal, the #1 and #2 largest theatre exhibition companies, have most at risk in the short term. Comcast and DirecTV are looking at the long term. No one knows what will capture the public's fancy with increasing amount of content being consumed on tablets and phones. Staking out their claim with talky independent films (which are shorter and scale "down" visually) may translate well from the empty screens at the multiplex to home, where AMC can still take 60% of the revenue.

Predicting what people will pay for is a fool's game. The LA Times article quoted above reminds us that this is similar to the fight over Disney's "Alice in Wonderland" last year, when Disney wanted to shorten the time from theatrical opening to DVD to 3 months. Marketing was no doubt trying to mitigate the likely dramatic fall-off of business for a title they predicted (and not without precedent) would have no legs.

They'd seen the movie. It wasn't very good.

Disney backed off when the theatre chains threatened to boycott the film, and subsequently and surprisingly, "Alice" continued to play to curious and hood-winked audiences, partially due to the confluence of 3-D still being new and unburnished by "Clash of the Titans" and "Piranha 3-D," the very fecundity of the idea of making Alice a sexually stirring post-adolescent in the remake, and the promising if half-baked potential of Depp as the Mad Hatter, a conceit ultimately not exploited in the film but no matter. "Alice" grossed $330 million in the US and $690 million more overseas, making it even more popular than those Pirate movies.

An early release of "Alice" to home video (in any format) would have quenched curiosity, shortened the run (over 4 months domestically) and suppressed the upper reach of its gigantic receipts.

Everyone is in a rush to bite the hand that feeds them, while the old saw that content is king still proves itself out, in potent and unexpected ways. The fertile potential of good films is the 800 lb. gorilla in the room that still drives people to what they want to see, wherever they have to go see it.

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