How to make money from internet distribution?

karapetkov

karapetkov

Well-known member
OK, I have another (brilliant) idea.

I can’t get no sleep, LOL.

(It’s okay, Mods, no illegal pirate manifestos this time.)

***

OK,


How to make money from internet distribution of (indie) movies?


To keep it short, the scheme is this:

1. You make a great movie that people want to watch [a docu, short fiction, feature-length fiction, whatever]. You can’t get away without that.

2. Then - you'll distribute it in the Internet [only]. Free legal downloads for all.

You make a download page for the movie or register it on some P2P torrent tracker.

BUT,..

3. Before you launch the download page\site, you go to a company [or companies] and [somehow] convince them to sign this particular kind of (advertising) contract:
  • The download page is designed in such a way that it includes advertising banners\clips\logos\pop-ups, etc., for the product of this particular company [companies].
    [*]Your movie stays free-of-charge for the users from beginning to end.
    [*]The company doesn't have to pay you ANYTHING, unless your movie becomes popular.
    [*]But if your movie DOES become popular, the company gotta start paying you money [in a scheme fixed by the particular contract you’ve signed].
Let’s think about the situation:

The downloads of your movie are free of charge [killing piracy]. But if the movie becomes popular, the company benefits from this, because many people are being exposed to all of their ads\banners\clips\logos\whatever, that are neatly positioned on your download page.

Example contract:
  • Say, if your movie has been downloaded [freely and legally] under 10 000 or under 100 000 times, you get NOTHING.
  • But if your movie has been downloaded by 100 000+ people, the company is obliged by the contract to pay you money - a pre-negotiated amount, or a given figure for every new 100 000 or 1 mln. downloads., or whatever contract details you have negotiated.
There’s your money. :)

Roughly put.

In such a scenario everybody wins cause:
  • If your film fails at the download-boxoffice, the company doesn’t lose anything [and you don’t gain anything either].
  • If the movie is successful, then - yes, they gotta pay you money, but they also got their shi*ty products [in]directly advertised.
Problem solved. :) :) :)

Just like TV. And applicable to both music and movies.

Of course, you gotta include the ads\banners in a way that they don’t become too annoying. Otherwise some pirate will hack the movie and put it on a free-of-banners site in China. :)

Also, you gotta have very secure download sites, so that the companies will feel safe that noone messes with the download counts.

This is just rough outline.

Whaddaya think?

I’m so excited… and I just can’t hide it.:Drogar-BigGrin(DBG)

***

I’m excited cause, (Maybe) I won’t die of hunger. LOL.
 
karapetkov said:
1. You make a great movie that people want to watch [a docu, short fiction, feature-length fiction, whatever]. You can’t get away without that.
Click to expand...

That's the real trick isn't it...I mean if I had a goose that laid golden eggs, I could probably make a fortune if I sold those eggs at the market every week. Pretty foolproof, huh?
 
YouTube just announced they're going to start offering full-length feature film streaming. Probably will operate very similarly to what you're describing -- except any revenues probably go to Youtube...
 
DerrickTempleton said:
That's the real trick isn't it...I mean if I had a goose that laid golden eggs, I could probably make a fortune if I sold those eggs at the market every week. Pretty foolproof, huh?
Click to expand...


Of course that's the trick. That's always the trick.

What do you expect? :Drogar-BlackEye(DBG
 
I guess I was expecting a scheme for people who don't make great films and who can't get 100,000 people to watch them, since that's the reality for 99.9% of us.

If you can achieve step 1, then step 2 shouldn't be all that tough...
 
DerrickTempleton said:
I guess I was expecting a scheme for people who don't make great films
Click to expand...


Noone can do anything about that.

Do you want to buy a DVD, if the movie sucks?

Same here.

and who can't get 100,000 people to watch them, since that's the reality for 99.9% of us.
Click to expand...


Yeah, that's tough - but there is a chance. If you got good material and you show it to the right people, they'll give you the contract. And initially, they won't have any expenses - they got nothing to lose. Only a signature. And if your movie becomes successful - they win again [being advertised].


If you can achieve step 1, then step 2 shouldn't be all that tough...
Click to expand...


I'll try to achieve something for my movies, you have to do it for yours.
 
As someone who spent about half my time in the last two years dealing with business; which included writing a business plan, pro formas, budgets, distribution models, tried to raise capital in numerous ways, plus studied many other models trying the same, etc. I can tell you that your plan has pretty much been discussed before by others (not me). Big names such as David Milch (Deadwood, NYPD Blue, etc.) have looked into serious internet distribution even. The rub is that it's hard to make a profit. You have to have a really long tail (long sales time, like a book on Amazon that sells little bits over months, years), and it has to be of high quality, and made with a low budget. Plus it has to be presented in high enough quality that people will watch it on their computer. This is all a real tough row to hoe.

Here's an article on indie filmmaking and the web. The first half of what he says is very real.

Here is a link to an article from the NY Times worth reading about people with plans.

Here's another one, this one a round table discussion on indies and distribution, and the web.

I have more. They get long, dry, boring. And that's without even looking at numbers. Business is boring much of the time. It drains from the creative side. I don't create much anymore it seems. It's really hard to straddle both sides of the river, hopping back and forth.

Sorry, I digress.

In my studies, I believe a future system for indies must work like this: There must be one (or more) HUGE websites (like Yahoo huge) that will house independent films. These sites must be very well organized, and easy to navigate (like Netflix), and have the films downloadable, at at least 720x480. These films must be viewable on either your computer, TV theater system, iPod/iPhone, or other similar unit. If this is met, and the site is backed by enough advertising, and size, they can charge a monthly subscription (or have enough advertising banners, or ads before or in films, like TV) to turn a profit. People are much more likely to pay for a monthly subscription of $10, than watch a film at $1 per download I believe. And even more likely to watch for free and deal with banner ads, or even bugs.

Now, new TV's by Sony allow direct viewing of internet content on your TV theater. iTV is making it to where you can interact the two. For example, you can watch YouTube videos on your 1080p TV. This needs to be the norm, and it soon will be. Now, YouTube is low res crap, but we're infantile at this point, like a 2 year old. But Google has more money than you can imagine, and a lot of smart people there. So expect some positive growth this direction.

I mentioned Netflix, they are another brilliant company, and really smart on the curve here. They have a great website, easy to navigate, not cluttered. They have downloading of some films already, and are planning for more. So, the future looks more like this to me:
• Log on to Netflix.
• Pick your movie. Hit the "watch" button.
• Make popcorn, get drink, go to restroom, mute cell phone.
• Sit in front of TV, click the link (grab iPhone and head out door, etc.)
• Watch movie.

Now that Sony (who has huge capital) is heading this way and advertising it. And Netflix is heading that way, and Google/YouTube are likely to cater to the same, it's just a matter of people understanding the sites they are on, and how to work it.

If someone wants do to this on an independent level (start-up, not rely on Neflix or Google/YouTube) now is the time to jump on. But they won't be able to do it alone, and it's going to take capital. A lot of capital. Someone must jump on soon with a super well designed website (Netflix is a great model to me), showcasing tons of indie films that aren't over-trodden by ads from major Holllywood films (like iFilm became). They must then spend a great deal of smart money advertising to get the word out that this is THE place to see indie films, download them at fairly high res, and watch them on your TV/computer. The capital must also be used for legal, tax, and financial advise. And they are going to have both a crack sales staff, and customer service (even if these are only a handful of people, as they should be). Business management experts such as Michael Porter, or Peter Drucker have emphasized this and pointed it out in some of the most successful businesses - advertise, give good customer service, be honest to your staff and keep them happy. Over 20 years ago Tom Peters and Robert Waterman wrote In Search of Excellence, a mega-best selling business book. The core of their book was that a business needs this to succeed: Happy customers. And the best way to get that is to have happy employees who are well trained. Yet, 99% of businesses out there don't follow this model, they offer crap (or overseas, usually both) customer service, and have workers that despise their job.

I could go on and on, I've already written too much and feel like I'm rambling, but I think you get the idea.
 
The great thing about discussions like this is that I ALWAYS learn something. We spent the last year developing a business plan and outlining ROI for different distribution channels as well. THe one thing I know is that the model is shifting both in terms of marketing and delivery.

I recommend Filmspecific.com a lot. Good site.
 
youtube has added a whole new area to their account menu.

it is called
Monetization Tools
They now have an AdSense video player that pays you per view.
 
Jim is right from my experiences. There is a lot of shifting sands in this desert we walk in. It makes things very unpredictable. As a result, it also makes it more risky for VC people, but with that, a potential for a big reward to the right player. It's an issue for us filmmakers though as by and large most capital investors (though not all) look for consistent sales numbers attached to SKU numbers, which gives them comfort. Not something common to our world.
 
I imagine this has been discussed to death, but there is no doubt that a huge revolution is just about to take place that will radically shift power in the entertainment industry, as well as publishing. It becoming easier and cheaper to make content whether it be movies,documentaries for entertainment or e-learning programs for education. Software that 10 years ago was only in the hands of major companies can now be easily bought,learned and used by individuals.

Someone mentioned it before but I would suggest everyone on here read "The Long Tail".
 
People have been saying that the revolution is coming, and I think it's going to be sooner than later. Everything is there except for the payment system (which is being screwed-up by the MPAA, RIAA, on behalf of the big studios who want to market their films/music through advertising rather than the new upcoming paradigm -- personal choice.)

As an example I live in a country where English-language films are simply unavailable, so have to download ("pirate", some would say) them using your friendly-neighbourhood file-sharing network. I only have a 128K DSL connection, but that's enough for roughly 1 film per day, or 30 FILMS PER MONTH. I would gladly pay a buck or two per film IF I COULD BUT I CAN'T. It's super-convenient -- just add a film to the cue, and in a day or so it's done. To be honest, it's a struggle keeping up -- there's simply not enough time to watch everything.

The delivery system is there. The payment system is not (but could be). Think of the number of people who download (sorry, **pirate**) films that would gladly pay a buck or two -- and imagine that it was YOUR film and YOU got ALL of the money from it. You would only need a couple hundred thousand people to watch (nothing by today's standards) and you're suddenly making some serious dough.

This is the future. The key will be to retain ownership of your material so that whatever ends up happening (and who knows -- there may be some other completely different paradigm that develops) you will be the one that profits -- not some middleman.
 
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I agree, I'm American but I live in Japan and its very difficult to get my hands on new movies (non-blockbuster), books, tv shows so I am forced to get them thru other *ahem* non-traditional ways
 
I noticed the same thing when visiting Hong Kong a few years back. It surprised me at the time. Today I know how much of an antiquated dinosaur the studios (MPAA, RIAA etc.) are, so no surprises anymore.

Scott Billups spoke of this change in his book, Digital Moviemaking, about 5 years ago, I believe the chapter is called "Binary Horizon", and the latest version has a chapter called "The Next Big Thing" that really spells it out, so it's not like it hasn't been around, but yes, we're in the middle of it.

Yes, I mentioned The Long Tail. A distribution concept presented by Chris Anderson based on Pareto Distribution (for fans of Numb3rs, Charlie Epps would have a lot of fun with all this!) .
 
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