On Current TV Biz

When It Comes To Television Content, Affiliate Fees Make The World Go ‘Round.

"From a cost accounting perspective, a studio should allocate these fees across the content development costs, and therefore, they are not explicitly 100% GM. But as there are no significant variable costs related to the deployment of these programs to the carrier, most content owners cannot help but think about affiliate fees as 100% gross margin and therefore the key contributor to overall profitability.

"If you own a cable channel, your goal is to develop one or two key, hit programs, and fill the rest of the linear lineup with very inexpensive content. The “hits” make you a “must have” for any cable or satellite carrier – granting you the right to ask for fees."

"Why would a cable distribution network want to own content? First, it’s a hedge against rising content costs (affiliate fees). Second, it offers leverage vis-à-vis their competition."

"Why earn your customers one by one when you can get to mass volumes, and a fixed amount of recurring revenue, through a distribution partner?"

"The fox isn’t just guarding the henhouse, he designed it."

Getting Your Trailer on iTunes Movie Trailers

"Films need to be theatrical films that are headed for USA releases... Our primary source requirement for submission is the highest resolution source as possible- as an uncompressed QuickTime file in .mov format. We also accept ProRes QuickTime .mov files as long as they are at as high a bit rate, frame rate, and resolution as possible."

Redbox vs Blockbuster Express

It's safe to assume I'm voracious movie watcher due to my inclination to become a better filmmaker as well as my nature of vocation working in "the industry." My choice of DVD rentals have been Netflix, but I recently rented popular (Hollywood) flicks from Redbox, $1 DVD rental per day. The price and the convenience cannot be matched by Netflix even with its excellent digital movie streaming service that comes with its monthly membership.

But I accidently came across a Blockbuster Express kiosk last month. Same deal like Redbox, except in typical Blockbuster packaging.

Blockbuster Express Kiosk

I naturally gravitated toward the kiosk to check out the offerings and its user experience compare to Redbox. The selection seems similar to Redbox considering Redbox signed concession with Hollywood studios to delay 28 days before putting latest movies in its kiosk. I guess the Blockbuster Express program is popular enough to warrant Hollywood studios' wrath yet? However, I'm little surprised how many Blockbuster Express kiosks are placed within Manhattan.

The kiosk is like 1.5 bigger than a typical Redbox kiosk I've encountered. It has bigger screen, and a BIGGER screen on top to advertise latest movies and such. I'm little surprised that the main screen is a CRT instead of a LCD touch screen, which I blame for its sluggish responses to my touch. The UI design is functional, but ugly compare to more cleaner UI of Redbox. The process is familiar to Redbox customers, but some reason the credit card reader has harder time registering my card compare to Redbox credit card reader. Basically, everything about the Blockbuster Express kiosk feels sluggish, like its parent corporation.

Finally, the DVDs are spitted out at the slot below the main screen instead of next to the screen on a Redbox kiosk. I don't know why they decided to put the slot there, forcing me to bend my back and/or knees to pick a DVD up instead of just reaching for it. Repeat that process for returns and it quickly becomes a hassle.

Redbox Kiosk

I always thought the Redbox kiosks were functional but could've used improvements on how they promote latest releases or soliciting customer feedback. But after the Blockbuster Express kiosk experience, Redbox looks like downright genius. It did prove to me that its winning business strategy isn't simply built on cheap rental price alone. Redbox did make renting DVDs much more convenient as well as cheaper compare to all other competitors in the market.

So, back to Blockbuster Express. The kiosk dropped this hunk of black plastic brick on me.

Blockbuster Express DVD Case

Yes, it's that unappealing piece of plastic and weighs like a solid plastic brick to boot. What's worse is trying to get that DVD stuck within this case. You basically have to pull the DVD out like you're pulling a tooth. I advise not to use your finger since you may break your finger nails. Let's compare this plastic brick to Redbox DVD case.

The difference is night and day. The case is light with clear plastic and the case opens up without much struggle. The case clearly labels which way you should return your DVD along with the instructions to care for the DVD you temporarily hold for a day.

I didn't take a shot of the other side of Blockbuster Express DVD case because there's nothing. Just black. Nothing about how to return the DVD. So when I actually went back to return the DVD, I was perplexed to find which way to insert the case. Does the opening side goes in first, or not? And make the matter worse, the DVD case sits in the kiosk slot for good couple of seconds, which is an eternity in retail space. In contrast, Redbox kiosk accepts the DVD case immediately into its slot. Sure, it takes few seconds to register your return, but at least you're sure that the machine accepted the DVD, and doing something with it.

All in all, you can already tell this Blockbuster Express is hastily put together after Redbox became a successful enterprise, much like Blockbuster's belated responses to Netflix few years back.

So what's left for Blockbuster to grab customers away from Redbox? Coupons. Rent one & rent another free. 50 cents per DVD rental. It's the cheapest rental I ever came across in my life, no doubt. I've surrendered my usual yahoo email account and received regular marketing emails that contain a discount code. I've been using Blockbuster Express for more than a month and I can't help wonder when they wise up and and stop these discount codes. But I doubt they're not ready to stop considering you can get the discount code from the kiosk marketing screen on the very top as well. No wonder Blockbuster is flirting with bankruptcy.

In conclusion, I'll continue to drop by Blockbuster Express kiosks as long as I get to use discount codes. But I'll probably go back to Redbox once the deal ends or Blockbuster can't stay afloat in this cut-throat competition. This venture adds another colorful chapter to the Blockbuster business history for all entertainment business types to study over for years to come.

Why Netflix Won't Be the HBO of the 21st Century

"the name of the game is subscriber retention."

I love Netflix, but one way or another, Netflix will have to own or create original hit shows/films to compete with other content channels. Otherwise, it won't be more than a niche DVD rental channel that's increasingly squeezed out by cheaper rivals like Redbox.

On Marketing Your Film

"End of the day, I didn't make the movie for a poster, but I made the movie so people could see it."

The New World of Distribution

NYT: Declaration of Indies: Just Sell It Yourself! "It might seem counterintuitive that D.I.Y. independents are borrowing a page from the George Lucas playbook. But only if you forget that Mr. Lucas is the most successful independent filmmaker in history. 20th Century Fox distributed the first “Star Wars,” yet Mr. Lucas kept the sequel and merchandising rights. “If I make money,” he said when the movie was released, “it will be from the toys.” The new generation of D.I.Y. filmmakers might not be pushing toys on their Web sites (though I’d like to see an Andrew Bujalski action figure), but they do peddle DVDs, posters, CDs, books and — much as Spike Lee did before them — are getting hip to selling themselves alongside their art."

Forget studio dollars and hustle for street dimes if you plan to go indie.

OK Go on Youtube videos

"So we’ve got this ridiculous situation where the machinery of the old system is frantically trying to contort and reshape and rewire itself to run without actually selling music."

Best illustrative letter on content/media businesses trying to adapt to selling (digital) bits instead of (physical) atoms.

Terrifying TV

Interview with Showrunner Ed Bernero. "We’re one of the most repeatable shows on television, we do almost the same numbers with our second and third run as we do with our first run, and it’s because the only place you can see us is on television. Because the two studios have never been able to agree on the sharing of the revenue, we’ve never been on line. You can’t download us, you can’t watch us on Hulu, you can’t watch us on anything but CBS... Our example should be, whoa, if you don’t put it online, people will watch it over and over on reruns. They will watch it on television. That’s our revenue stream."

"The relaxation of the fin-syn rules, where the networks could own shows, began the erosion of television viewership."

"We only program things that appeal to New York and Los Angeles and in many ways spit on the rest of the country... Let’s see if I can say this without ending my development career. It’s very female, development. Development staffs are almost all female. It’s not that easy to get a male skewed show through development."

"You don’t see loners anymore, you don’t see a Mannix or a Rockford Files or something where it’s a tough guy standing against the world. It doesn’t appeal to women... Women don’t really compete with their mothers; men compete with their fathers."

Fantastic interview about TV biz & running a hit show.

On the Netflix/WB Deal

According to John August, "When Netflix ships a disc of Corpse Bride, I get nothing. When Netflix ships those bits over the internet, Warners gets paid, and I get a few cents. That’s good."

The Future of Content Distribution