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June 10 at 8:30am

From Out of the Wreckage, A Future Rights Model

By Ted Hope

by Andrew Einspruch

Filmmaker Andrew Einspruch recently attended the Australian International Documentary Conference and wrote a series of articles for the event, which he’s graciously allowed us to reprint here. These articles originally appeared in Screen Hub, the daily online newspaper for Australian film and television professionals.

Film distribution is broken. Ask any producer who has ever felt that the amount they get for their work seems paltry compared to what others are making. For that matter, Peter Broderick has been saying this for years at SPAA Fringe.

There are lots of online film distribution platforms duking it out in the nascent VoD space. From the behemoths like iTunes and Amazon Instant to YouTube and Vimeo, to any number of small players trying to carve out a spot in the world. Andy Green’s Distrify is one of the ones actually making it work.

Green held an intimate session at this year’s Australian International Documentary Conference called Future Rights Model, and talked about how they built the platform. He’d been a filmmaker and experienced first-hand the frustration of getting stuff out into the world. For example, one distributor, when asked about making DVDs available for one of his titles, told Green, “It’s a small film. I’m busy.”

With that particular project, he wrested the rights back from the distributor, then tried putting the movie up as a BitTorrent, with a link for people to donate or buy the DVD. They had 600,000 downloads, and no more than 50 people who kicked in a few dollars. Plus, someone took the film, chopped off the credits, put their own credits on there, and put out the film as their own work. “I didn’t realise you could steal a film that was out there for free,” said Green. A disaster.

So he built Distrify.

Distrify has some simple, yet powerful ideas behind it:

    1. It uses a player that can be embedded anywhere, from your web site to Facebook to where ever. Green said they were the first company to offer video on demand on Facebook (although only just).
    1. The player is the point of sale. It lets someone watch the film where they are right now. No clicking through to somewhere else.
    1. You can set up a rental price and/or a download to own price.
    1. People can watch the trailer in the player, then choose to watch the film if they want.
    1. It has an affiliate model built in. Anyone who shares your video gets a 10% clip of any sales.
    1. The combination of the above two things helps decrease piracy, turning potential enemies into advocates.
    1. The filmmaker controls everything – the pricing, any geoblocking, all the marketing. Distrify is really just the platform. It is still up to you to make it work.
    1. The filmmaker has access to all data instantly. Information appears more or less like a bank statement. Between GPS and IP information, you can know exactly where in the world your audience is. So if you see that suddenly your are popular in Gibraltar, you can use that to try to create more buzz there.
    1. Central to self-distribution is knowing who your customers are. Distrify gives you access to your customer emails, which lets you responsibly communicate with them.

Here’s an example of what the embedded player looks like. This one is for Terry Gilliam’s film The Wholly Family.

The revenue split is simple: 65% goes to the rights holder (that is, the filmmaker or whoever owns the rights). That compares pretty favourably to the 70% you get from iTunes, for example. Distrify takes 25%. And 10% goes to the person who embedded it (that’s the affiliate part).You can offer the affiliates more, to provide them more incentive, but that is the base starting structure.

Distrify currently has about 2,500 films of all types available. 45% are documentaries, and another 20% are in the lesbian/gay category. They reckon they have more lesbian dramas than any other company in the world – not by design, but they think it is because other platforms, like iTunes, don’t have a lesbian or gay subcategory. The embedded player gave people with that particular interest a chance to post films that were of interest to them.

Nigerian “Nollywood” films, like Uche Jombo’s film Damage, have also done incredibly well on the platform.

Green’s company has been agile enough to respond to consumer demand. For example, they added Mexican’ pesos as a currency simply because they could and because someone asked. Amazon won’t take payments in pesos, but this Scottish company will.

Green says he thinks that the true nature of the Internet is one of a village. He was trying to create a mechanism where people could hang over their back fences, chat to each other, and make recommendations – a mechanism that facilitated discussion. He is confident he has succeeded.

If you choose to use Distrify, perhaps that village will talk about your film, and help you prosper along the way.

Andrew Einspruch is a producer with Wild Pure Heart Productions . His current project is the low budget feature film The Farmer.

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  1. Dean / Jun 10 at 8:30am

    I like this, I like it a lot, I still prefer the vimeo model, but that may just be an idealistic approach, I do like the idea that people sharing your movie have a financial incentive to do so, there is also the possibility that this incentive will generate more sales in the long run, it is an interesting concept, that is pretty exciting ( I have been keeping an eye on distrify for a little while now ).

    The only hurdle I can see facing all new film distribution platforms, is the big hurdle.

    Do people ( the majority ) actually believe they should pay for films anymore ?

    If they do, do they believe they should pay for films from people they have not heard of ?

    We have a slight problem, in that people are used to getting films for free, based on experience with torrents, youtube, etc, and now we are asking them to change their habits and requesting that they pay, it is a tricky, tricky proposition and of course the customer is always right.

  2. Mathieu Noel / Jun 10 at 8:30am

    “Do people ( the majority ) actually believe they should pay for films anymore ?”
    I’ve been wondering about this for a while. We are surrounded with free movies that our friends are sharing, so why pay to see one ? I think we have to come up with an experience people can’t find elsewhere on the internet. “The Cosmonaut” did it well : They released their film for free and created “the Cosmonaut Experience” which give you access to a lot of stuff. I think the question we filmmaker have to ask ourselves is : What is it the audience is gonna look for in my movie, and how can I improve it enough so that they will be ready to pay for it. The film should be free but not the experience.

  3. Tom Broadhurst / Jun 10 at 8:30am

    I’ve used this its a great idea but didn’t work for me. We have 14,000 people following us on FB I think we got 10 people paying $2.50, ultimately we put the film up on Vimeo for free it’s had about 3,000 hits, been blogged everywhere in a very niche audience, people just don’t want to pay, even for something that really interests them. The distrify model and concept is great. It’s the spoilt content saturated, fiscally tight and apathetic audience which is the problem.

  4. Tom Broadhurst / Jun 10 at 8:30am

    I can answer that…people don’t want to pay.

  5. Dean / Jun 10 at 8:30am

    Thank you Tom for actually posting your numbers and experience, its really helpful for me personally, I have a feature length project that will probably shoot at the end of this year and the only thing I don’t know about it, is how I will actually recoup any costs at all, that is not being negative about it, its just being realistic.

    While the way the audience wants to consume films now, does frustrate me too sometimes, the only way forward is to accept it, as you said, “People do not want to pay”.

    This is one part the glut of content out there and another part that audiences are conditioned to receive content for free, heck, people even hate the adverts that they can skip after five seconds on youtube ( those adverts that don’t even pay anything anyway ).

    You could actually make more money ( as a test ) selling films at a car boot sale, the UK version of a garage sale, than you could from some of the online distribution deals.

    So filmmakers have to find an alternative.

    It probably won’t be the audience paying ( outside of acts of almost charity or if audiences suddenly have a bizarre collective moral epithany )

    It probably won’t be advertising supported ( as audiences hate that too )

    It probably won’t be cinemas, as they are expensive and essentially monopolised.

    Its a smarter person than me that will figure out the solution.

  6. Dean / Jun 10 at 8:30am

    I may be being a “stick in the mud” here and I do love that example you have stated, I would like to see the numbers on “The Cosmonaut Experience” just as an anecdotal.

    It is strange though, film-making is a craft, it is something you need to take years to learn ( I am still learning more everyday about the mechanics ) and the wares we train ourselves to sell are the films themselves.

    To use a bad analogy.

    It now seems that we are carpenters, giving away free tables and then trying to charge people to have us cook them a meal.

  7. Tom Broadhurst / Jun 10 at 8:30am

    I cannot stress enough that I think the Distrify concept is great although I do think they need to do some work on their interface etc. when we first launched our film that was a kind of teaser for a DVD release I did get a few messages from
    People asking ” why are you charging for your films? ” the audience simply doesn’t get it. They don’t understand that independent teams as small as 2-5 people are producing this stuff that they enjoy.
    Because this wasn’t a success for us that doesn’t mean it might not be a success for others. The concept is great. Another worth mentioning is Vimeo’s Pro account $199 per year subscription. I know some people this is working for again the price point has to be super cheap.
    You could pull your hair out about the state of distribution and what the answers are. My recent experience with trying to develop a TV show just left me utterly disgusted with broadcasting. I don’t know we really are at the crossroads. Hard to get the money to make films hard to recoup that expenditure amongst a culture that feels content should be free or so cheap it doesn’t make it worth it. I firmly believe good ideas find a home. But I see my friends who are pirating loads of stuff and I just wonder what the future looks like and if this filmmaking thing is just hobby.
    Today I walked off a transmedia short documentary project we were running called http://www.fueltank.tv we had a plan it was about aggregating others content building an audience giving away films for free moving towards a model whereby everything would be available via an app. We even took a TV pilot to MIPTV this year. it was niche driven with a transmedia mix of magazine and short documentary films, combined following on FB of about 40,000. Today I said fuck it enough after three years of focus and hard work. Cest Le Vie

  8. Mathieu Noel / Jun 10 at 8:30am

    I agree that films is what we should be selling as filmmakers… Well the music business may be an inspiration : I read somewhere that nowadays artists have found a “solution” to piracy by making most of their money during live shows. Maybe filmmakers should act like rock stars, to quote Marc Schiller (http://www.indiewire.com/article/why-filmmakers-need-to-act-more-like-rock-stars).

  9. Dean / Jun 10 at 8:30am

    So under that logic of being touring rock stars there are a number of options.

    Festivals ( which most filmmakers would try to do anyway )

    Four Walling ( costly and no assurance of a return )

    Sponsored cinema run ( great if you can somehow broker a deal )

    Alternative venues ( special screenings a-la “Secret Cinema” )

    Pretty much all of the above scenarios mean you are dealing with one core problem, how to get an audience to show up, to a film you are doing this live extravaganza for.

    These twitter followers/facebook fans/tumblr people who are not going to pay a couple of bucks to download your film legally, but they are going to pay to show up to your event, playing in one location at one time ? They will travel to wherever you are ?

    This is not to in anyway bash the idea of all being rock stars, nor is it to be negative for the sake of being negative, I am just trying to be pragmatic and find a solution to the collective problem of modern day distribution.

    Short of scarcity ( the film is only available in one place ) coupled with extreme support from bloggers and reviewers and great festival buzz …I can not yet see a viable solution that will actually generate real sales.

    I am happy to be proved wrong.

  10. Mathieu Noel / Jun 10 at 8:30am

    Sure it’s not simple but I think there’s something there. Think about it : this is theoretically the best way to offer a one of a kind entertaining
    show to people. And I have no doubt people would pay for this because it’s a shared experience, it’s a show, it’s social, it’s everything people look for in modern entertainment.

  11. Andrea Buck / Jun 10 at 8:30am

    I love this analogy, Dean.

    People won’t pay for content, but they will pay for hardware and bandwidth, and what’s the point of those with no content? Perhaps we need to move towards a system of royalties – the more your content is consumed across the bandwidth, the more you earn. Not ideal, and I suppose the porn sites would suck up most of the royalties — but is there some way to get money to content creators without directly charging end users?

  12. Andrea Buck / Jun 10 at 8:30am

    Agree with you Dean. Other problem is price point. People will pay over $100 to see their rock star in the flesh, but not a film, even if the star showed up. One city at a time is too resource-heavy to afford the marketing required to fill a cinema, and you can’t be in 10 countries at a time. Online should be perfect for indie films because niche audiences can be accessed globally. Still the problem of them not wanting to pay.

  13. Andrea Buck / Jun 10 at 8:30am

    Except it’s a cluttered world. Not only too much content online, also too many shows, parties, events, festivals competing. Have you actually tried to fill a whole cinema and seen the resources it requires? I think Event Screenings is definitely a way to go, but it is not an easy fix. It is expensive and time consuming. If you have an expensive film, a hard way to make your budget back, and then enough to cover marketing and pay yourself for the time spent on marketing and attending your events after you have already spent so much on making your film.

  14. Dean / Jun 10 at 8:30am

    I am planning an event based screening system for my next “big” project at the beginning of next year, I am under no illusions, it will be a hard slog, a complete gamble and potentially very low return, the only ace in the hole I have is that the budget for my movie will be low enough, that I can afford to spend out on a mini tour of arthouses, but this is alongside having a day job too and paying rent etc…..

    …Which obviously I would not be able to do for too much longer, purely because it would render me bankrupt.

    Getting a 100 people to show up to a movie outside of friends and family is a monumental task…hell, getting people to watch a short film, for free on twitter, is now a monumental task too, filmmakers through their need for an audience, have sold themselves short and possibly crippled their entire business model long term.

    Unless we tackle the film should be free culture, I can only see this getting more difficult, I still have not heard a convincing argument ( in years ) for why a person should not pay for a movie other than “I don’t want to” or “I will just torrent it, I don’t care” ..

  15. Dean / Jun 10 at 8:30am

    If advertising paid, that would be a way, but advertising really does not pay any sort of reasonable amount online ( because online advertising does not generate too many sales or even click thrus )

    I am going with charging for the movies in some fashion, because even if I only sell 1 copy, I still got more return than if I gave it away for free…and exposure is really not a factor, as odds are, you won’t be the 1 in 100,000 filmmaker who gets “discovered” on Youtube.

    Talking numbers, if I sold 6 copies of a film ( even at a stupidly low price point ) I will have made more than if I had a thousand views. ( at 0.01 per view, which is actually quite high for online ad revenue )

    This is not about hoarding profit, its about creating a “Sustainable” film culture, trying to only break even and not go broke, whilst making projects in spare time.

    I don’t care if the movie was poorly made and sucked and had cheap production values, terrible acting etc, you should still pay to watch it, just like in every other generation.

  16. Andrea Buck / Jun 10 at 8:30am

    I wish you sincere good luck with your screening. It is not impossible for it to work. In 2007 we DIY released our film, The Jammed, starting on just one art house screen, and it took off. The film did so well, breaking screen average records to become the highest grossing opening week screen average for any independent Aust film in history — ($48,000 on a single screen first week). Based on that it platformed out to 38 screens, and stayed in theatres for 16 weeks. Lightening in a bottle, but with savyy, good marketing, perfect timing and luck it is possible. I hope good things happen for you.

  17. Andrea Buck / Jun 10 at 8:30am

    Then there’s also the ad-rev share model. Also crap money. Back to The Jammed – we got 20,000 views over our first weekend on a platform in Australia, on a 50/50 rev share basis – about $3,000 to us. On the old DVD system if we’d sold 20,000 at $10 that’d be $200,000! The payment from Youtube views is insulting to content makers, it is abuse. I would LOVE to be able to sell my film for $3 a view and have 500,000 views internationally. That would be a business model that could keep us in business.

  18. Dean / Jun 10 at 8:30am

    For what its worth, I am going to buy a copy of The Jammed now, if I can find it online, because I have to put my money where my big mouth is.

    I wish you all the best, with all your projects too ! Keep everybody updated.

  19. Andrea Buck / Jun 10 at 8:30am

    That’s a great idea! You can buy it for $4 or watch for $1 at http://fillim.com/the-picture-tank

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