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March 22 at 8:08am

Free Is Not Worth The Price (And Neither is $1.00!) Part 2 of 2

By Ted Hope

Today’s guest post, like yesterday’s, is from filmmaker Michael Barnard.  Yesterday, he covered how we slipped into our embrace of “free”.  Today, he writes of the deadly results.

I used to read Daily Variety online religiously. Now I don’t. When I click on my fifth article (or whatever the tipping point is) and am denied access, I resent it. Yet, I know that if Daily Variety does not succeed somehow, I am either going to have to become my own journalist (“JOURNALIST”, not merely an observer or repeater) or I am going to have to rely on agenda-laden, word-of-mouth bloggers.

This situation is also affecting indie filmmakers. Indie filmmakers have to deal with the very worst form of free: theft by piracy. They have to deal with distribution outlets that want their films for free. Even REDBOX, with their $1 DVD rental kiosks, a pet peeve of mine, is an enemy of the indie filmmaker.

The success of REDBOX comes from ripping off filmmakers. In fact, you have to admire REDBOX for achieving something few ever have: they have even ripped off the studios! By circumventing the sales requirements for rental DVDs (REDBOX bought their DVDs from big box stores like Wal-Mart at discounts rather than at “rental” pricing from wholesalers), they stripped the potential profit from rental fees and kept all the income for themselves. They single-handedly killed the perceived value of DVDs by pricing them at only $1. Yes, they are successful, but because, of course, EVERYONE WANTS FREE. $1 is “free” as far as the film business is concerned, since there was no return of any of that income to the filmmakers. (The studios have since coerced REDBOX to start playing on a more level playing field.)

Bear in mind: McDonald’s will offer you a $1 burger. Why? They know that’s as good as free to you. But the difference between REDBOX $1 DVD rentals and McDonald’s occasional $1 burger is that McDonald’s still has its full-value menu for you, and will up-sell you with sodas and French fries. They sell $1 burgers with the full intention of making a profit and without killing the perceived value of a standard McDonald’s meal.

When REDBOX rents you a DVD for $1, that’s it. End of story. There’s no more income stream possible, there’s no up-sell, there’s no method to establish the realistic value of the product.

And the most hostile effect for indie filmmakers: the kiosk only displays a couple dozen titles, so indie filmmakers can no longer compete for viewers’ attention as they used to when people wandered the aisles of their local Blockbuster.

$1 DVDs from a REDBOX kiosk are the same as “free” and the impact is just as profound on filmmakers as the free online content has been on the news publishers.

The impact of “free” is beginning to cripple journalism and filmmaking.

At some point soon, it will sink in to me, and others, that FREE IS NOT WORTH THE PRICE.

Michael R. Barnard is a filmmaker and marketeer living in Hollywood. He is rushing towards pre-production on his indie feature film A FATHER AND SON (http://AFatherAndSon.com)

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