Saturday, November 17, 2012

The Hi-Speed of Digital Distribution for Indie Films

Everyone is talking about how digital distribution (online streaming/downloads) is the future of independent film distribution and revenue streams. It is true that it is becoming a major force in the world of revenue streams for indie filmmakers, but it is one s-l-o-w machine.

What I didn't realize and I'm sure most indie filmmakers/start-up labels don't realize is that there is a huge bottleneck in the digital distribution pipeline. If you're working deals directly with digital distribution outlets like Itunes, Netflix, Hulu, etc. Then you have to deliver different files to each outlet and here's the big bottleneck, they have to be approved by each outlet's Quality Control department. Since your film is a small indie film you get pushed to the bottom of the pile, because the big studios need to have their films hit their release dates on time. If everything goes well, it can take up to 90 days or longer for your film to go live on a given digital platform, but if there was a problem with your film in the quality control department, you're back to square one.

There are literally hundreds of digital platforms out there, with new one's opening up and going out of business on a daily basis. So dealing with digital outlets on an individual basis for most filmmakers or smaller distribution labels is almost an impossible task. There is a solution, there are digital aggregators out there like Craze Digital, The Orchard and many more who deal with all the platforms for indie labels and then take a cut. Most of all the major wholesale distributors these days are dealing with a lot of the digital outlets as well.  The other nice thing about dealing with aggregators is that you only have to deliver one file to them and they in-turn deliver to the other outlets.

The downside to aggregators is they take a decent percentage of the revenue coming in and just like the platforms they will have priority titles that will be put ahead of yours. So you end up at the bottom of two piles, not just one. The other benefit to aggregators is since they move so much content through the digital platforms you usually will get a break on encoding costs. Yep, even if Itunes accepts your movie there is an encoding fee of around $450 for Itunes to encode your film to their specs.

With every indie filmmaker, distribution label, major studio and aggregator out there submitting titles to the major digital platforms at the same time, you bet there is a big bottleneck in the quality control and encoding departments. It's a slow process, that can be very beneficial for an indie film, but don't plan on hitting your planned release date. Currently I have heard that Roku Streaming has literally hundreds of new channels in que waiting to go live at any given time. That's channels, each with over 100 titles, not just individual films.

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Friday, November 9, 2012

Retail is Dead? Indie Film Distribution in 2012

My name is Jonathan Morken, for those of you who don't often read my blog, and I run Apprehensive Films an indie distribution label/production company. My blog generally consists of posts about what Apprehensive Films is up to, our new releases, fundraisers, merchandise, new projects etc. But I've decided that on Fridays I'm going to be writing a post about the different distribution questions I get and the current state of indie film distribution as I see it.

I got into distribution six years ago after making many short films, music videos and a feature length documentary. My reason for starting the distribution label was to control my films and be able to work backwards. If I knew what a release could actually make, what it would take to get a release onto cable and into major retailers, then I could plan the films we produce in-house around that and we would have a really good shot at turning a profit and making another film. Six years later the plan is working. Apprehensive Films now has full blown North American distribution. We get our projects out to major retail, cable, all the major digital outlets, all the major online retailers and we have international representation. As of last week we just wrapped principal photography on our first in-house produced project that is based on our current level of distribution.

Now that we're through with the introductions I want to talk about an issue I hear coming up all the time. Distributors and Filmmakers complaining about how retail is dead and there is no money to be made through traditional home video distribution. I'll be the first to admit that retail has taken a big hit, but it's definitely not dead. Sure Hollywood Video is gone, Blockbuster lost some stores, Best Buy shrunk their DVD selection, but there is still a lot of open market out there.

There are 33,000 redboxes in the US, there are 4,700 Walmart Stores, 600+ Barnes & Nobles stores, tons of small indie record store chains across the country, thousands of comic book stores. The list goes on and on.

We just had a Halloween themed release that sold over 4,000 copies last month. But only 180 of those went through, the largest internet retailer, 3,000 of those sold units went to a major retailer in Canada. Our release was an indie release with no major talent and no major marketing campaign. But it still was able to catch the eye of major retailers, how? It was timed with a major holiday, had great cover artwork and quality content.

The market is flooded with too many indie films, but you can set yourself apart by making a quality project and coming up with a way to market the project so you don't have to have major stars or marketing campaigns. One of our most successful releases, that continues to sell is Hardware Wars, simply because it was the first parody of the most popular film ever made. Hardware Wars has never had a multi-million dollar ad campaign, but it is arguably the most successful short film of all time.

We're going to be pitching our Halloween release from this year to Spirit Halloween Stores (700 nation-wide) and Halloween City (400 nation-wide) for next year.

We also have been handling a documentary on fly fishing for a number of years and we sold a ton of DVDs to fly fishing shops.

I don't think retail is dead, it's sure not what it was in the hey day of VHS sales, but it is still a very large market I think a lot of filmmakers and labels alike are tending to count out prematurely.

- Jonathan Morken

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