TOD, fans, and partnerships: new growth opportunities in alternative distribution

In the shadow of giants like Netflix, Amazon Prime Video, and Hulu, new tools and services are being deployed to help independent directors and producers gain more control over the commercial destiny of their projects. They propose a new take on the ‘direct to fans’ approach.

Through crowdfunding or viral campaigns, independent productions are now more than ever coming to life in full public view and off the beaten paths controlled by the major studios and their massive marketing power.

Once ignored by well-known creators and dominant forces in the entertainment industry, self-distribution is experiencing a healthy revival thanks to redesigned operating models, new technological solutions, and changes to conventional release windows where movie theaters are the primary channel.

TOD: theatrical-on-demand

Gathr is a theatrical-on-demand pioneer. Since 2011, the California company has collaborated with more than 3000 venues in the Regal, AMC, Carmike, Cinemark, and Marcus networks to enable decentralized communities to access documentaries and films related to the social themes of the day, including Girl Rising, the 4th most lucrative documentary in 2013, and Awake: The Life of Yogananda, which generated revenues of US $1.4 million.

Originally offered to the rights holders, Gathr subsequently went on to acquire and distribute films, and in October 2016 established a foundation which accepts donations from viewing audiences and returns the funds to the various non-profit organizations involved in the causes championed by the films.

Screenings on demand encourage many creators to accompany their films across the country much in the style of a rock tour, ever motivated by establishing a closer connection and a deeper loyalty with their audience, without having to pay for the cost of a national publicist.

In some cases, like with the comedy Hits, the director-producer, David Cross, took advantage of his participation in the Sundance Film Festival to launch a crowdfunding campaign on Kickstarter to cover the operating costs of some 50 screenings on the road. In 2015, Hits also became the first pay-what-you-want film on BitTorrent Bundle.

Analytical marketing and venues: taking on recommendation algorithms

In Canada and the US, firms like Bond Strategy & Influence offer audience development, multi-platform distribution planning, and revenue diversification services for independent creators looking to bypass traditional distribution silos. Exploitation strategies are tailored to each film and their target audiences.

From products derived from institutional markets to exclusive events sponsored by significant partners, Bond doesn’t hesitate to adapt formulas used by the majors on behalf of more modest and niche projects like Particle Fever and Deep Web.

“We still firmly believe in presenting our films in theatres in addition to online distribution,” said Bond chief operating officer Elizabeth Sheldon at the SODEC_Lab Distribution 360 workshop held last November in Montreal. “To reach potential viewers, it’s very important to go beyond the algorithm recommendations from sites like Netflix, which tend to favour their own original content.”

 Junun by Paul Thomas Anderson is one of the first acquisitions premiering on Mubi

At MIPCOM 2016, Bond acquired several documentaries for the international market, following the example of MUBI (100,000 subscribers), an SVOD platform specializing in auteur cinema, which started production and operation activities to stimulate demand for its exclusive content offerings, and FilmStruck, an SVOD service dedicated to movie classics and the creation of original accompanying content, jointly launched in conjunction with Turner Classic Movies (TCM) and The Criterion Collection at end of 2016.

SVOD platform…on demand

Just like consumers today can select the on-demand-viewing platform of their choice, rights holders can also now choose from a menu of new tools and services that allows them to create and operate their own platform or VOD Channel fed by their own catalogue, in the wake of YouTube Red, the Google SVOD service that has achieved mixed results to date.

Online video platforms like Pivotshare – where the Excellent Adventures series generated more money in the first 24 hours than the preceding year on YouTube – and white label solutions like ViewLift (acquired by SVOD platform and distributor Snagfilms in April 2016) and VHX, which became part of the Vimeo brand last year – are out to convince both producers and brands of the benefits of the SVOD à-la-carte model, in terms of transforming their audience into long-term paying subscribers.

Their strategy includes investing in original programming in collaboration with digital talents currently using the platform, encouraging content producers to develop their own episodic formats and put them online on a regular basis in order to build on the new binge viewing habits that subscribers have acquired thanks to Big Three (Netflix-Amazon-Hulu), and enhancing their interface to improve loyalty and social interactions with subscribers.

Vimeo thinks big

Vimeo, which plans to launch an SVOD service for a “fraction of the cost” of its competitors, also signed a partnership agreement to offer content for sale and download from Lionsgate (and its new STARZ acquisition) as to compete with iTunes. Vimeo will also invest more in its originals productions, including new webseries and its first documentary film, inspired by the success of its High Maintenance situation comedy, currently enjoying a second life on HBO Now.

From crowdfunding to co-investing in production

The main crowdfunding platforms, already heavily invested in web and film creators, have in turn entered a new growth phase in 2016 by developing strategic partnerships with their most prominent project promoters.

As the preferred platform for some 10,000 filmmakers since its launch at the Sundance Film Festival in 2008, Indiegogo has also been making it possible for project promoters who have reached their funding targets to accept donor contributions beyond their initial campaigns through its InDemand service, while giving them access to a $1 million matching fund supported by Vimeo in exchange for exclusive distribution on Vimeo’s On Demand platform.

Indiegogo, which contributed to the crowdfunding campaigns of the Emmy finalist Her Storywebseries and the Hardcore Henry phenomenon, the first action film entirely made in the first person (whose rights were acquired by STX for US $10 million), will offer documentary projects technical, logistical, financial, and digital distribution services provided by Warrior Poets, the Morgan Spurlock (Supersize Me) production company, which will also act as executive producer on selected projects.

For its part, the Fandor SVOD platform for independent creators, which delivers a 50% revenue share to the rights holders, has set up Fix Shorts, a similar initiative. Through this initiative, Fandor contributes fifty percent of the originating budget of each chosen project as to create a catalogue of exclusive original content.

And for 2017?

Do video content creators expect 2017 to be as eventful as 2016?

Ostmodern predicts that the VOD market will undergo significant evolution, most notably in the importance given to platform editorial lines, the valorisation of niche audiences, and, above all, a desire on the part of rights holders to “take content back” and free themselves from the lower royalties proposed by intermediaries by going directly to the viewer.

This is great news for rights holders who can, with a good deal of planning, effort, and endeavour, take advantage of complementary income opportunities and increased decision-making power while having a direct access to fans and their data, undoubtedly the most attractive aspect resulting from these new modes of distribution.

Charles Stéphane Roy
Charles Stéphane Roy is a multiplatform producer and innovation lead at La maison de prod since 2013. Before that, he was the editor-in-chief of the daily Qui fait Quoi. He also carried out research and strategic analysis mandates for the Observatoire du documentaire du Québec and and Evolumedia Group. His projects, which incorporate filmtech and innovative business models, were selected at Cannes NEXT and the Cross Video Days and by the Storytek accelerator, in addition to earning the POV Hackathon Award and the HackXplor Liège TV5 Monde Award.
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