Author: Philip

Categories
Business & Marketing Distribution

What did I learn about distribution at Distribution U?

Although I attend a number of conferences a year – often as a speaker – I mostly find that they go over ground that I either already know, or have heard the panelists/speakers go over before. In fact in 2008 there was one conference that I found extremely valuable – The Conversation organized in part by Scott Kirsner, who’s CinemaTech blog should be on everyone’s reading list.

So, naturally when Scott teamed with Peter Broderick on the Distribution U conference I signed up immediately. The conferences, held last Saturday, Nov 7, was a one day overview and summary of what people are doing to promote their independent films. While my primary interest is in the (as yet undeveloped) field of “independent television”, there were a lot of lessons from Distribution U (link is to Scott’s wrap up).

For me, the concentrated day helped me consolidate a lot of the thinking I’ve been doing on distribution over the last 3 or so years and helps me build on some of the thoughts I’ve been sharing via the (free) Supermeet 2009 magazine (How to grow an audience for your independent project) and via sessions at Digital Video Expo and other places.

Trying to summarize my eight pages of notes (a new conference record for me).

Scott Kirsner’s “scene setting” session started by pointing out how all technology innovation is immediately rejected by “the established players” – Edison hated projected film because he feared (accurately) that it would kill his profitable Kinescope business. We still see this happening today. His primary point is that “participation and engagement” with audiences is a crucial tenet of modern audience building – a term I prefer over “distribution”.

Another primary theme, from both Scott and Peter, is that the distribution for every project will be different, because the primary (or starting) audience will be different and what attracts one audience will not attract another. In modern distribution the “primary” audience for any project is one that is already engaged, in some way, by the topic or content. That helps get word-of-mouth buzz going and the audience can spread. Targeting a specific audience is easier (and cheaper) than trying to build a generic audience.

Another primary theme is that revenue comes from all sorts of places, not just “traditional” ones. A revenue mix seems to be the new normal for independent projects.

For example, the audience (and revenue) for Brian Terwilliger’s One Six Right has come from pilots, because the film is really about the romance of flying small planes and should appeal to every pilot in America. One Six Right has made money: (corrected after comment from Scott Kirsner)

  • selling DVDs directly (9,000 in the first 9 days it was available);
  • selling the soundtrack on CD (30% who buy the DVD also buy the CD of music unknown other than in the documentary);
  • selling posters signed by the 24 year old filmmaker (so far $30,000 from sale of posters)
  • listing (and selling) the DVD and merchandise through a catalog for pilots (Sporties);
  • selling through Amazon (where apparently the tip is to keep supply to Amazon low, which keeps them from deep discounts and keeps the sale price high);
  • selling a calendar (people pay to have the project’s promotion on their walls);
  • deals with local general aviation airports for local premiere’s;
  • giving the show to public television while retaining 4 x 15 second spots before and after the show to promote the DVD and merchandise;
  • creating a half hour “making of” special that builds the documentary out to a 2 hour or 90 minute package and selling that to Discovery channel. This sale apparently covered the original budget, on top of all the income from all the other revenue-generating activities, which is substantial.

I don’t know the budget for 161 right but some quick math shows that the initial DVD sales and calendar sales account for about $210,000 in revenue alone.

In fact, engagement with the audience starts at the very beginning of the project, rather than after production is complete: build an audience as you build the project and neither is more important than the other. Starting early builds an audience for the project and it builds anticipation.

Peter Broderick focused on “Hybrid Distribution” – don’t throw out all the “old” methods but adapt them and slice up the rights to the filmmaker’s best advantage. Never give anyone more rights than they need, and always retain direct sale rights for DVD and digital downloads. Although Peter gave a lot more examples at the seminar, his 10 Principles of Hybrid Distribution article provides an excellent overview.

I really appreciated the depth of examples that Scott and Peter provided, and the willingness to “talk numbers”. In most cases we got specific examples of the revenue from each type of activity surrounding the production.

Scott Kirsner will be speaking on “Building Big Audiences and Generating Revenue in the Digital Age” in San Francisco on Tuesday Dec 1 and I recommend you go if you have any interest in the subject – it’s based on his book Fans, Friends, and Followers (my copy is on the way and I’m looking forward to reading it).

I think this quote from Lisa Seward of Mod Communications summarizes the changes best:

You used to use your budget to buy an audience. Now you have to invent ideas to attract an audience.

The quote comes from an excellent presentation, referenced by myself and Larry Jordan already, The Audience is always right.

Categories
Business & Marketing

How do you turn generous offer into a PR disaster?

In The New Now I made the point that, whatever your promise in business, that you’d better be able to keep it, because when you make a promise or offer and don’t keep it, you usually do more damage to your brand than if you’d never made offer in the first place. By way of example, here’s my experience from this last week and how a company that I had fairly neutral feelings toward has turned me completely against the company, simply because they failed to follow through on a promise – a promise they didn’t have to make, but did.

Last Monday, Oct 26th TV Pro Gear sent out their regular newsletter (which I signed up for) with an offer for a free entry to the SMPTE show exhibition last week. I duly signed up for that free entry, figuring I’ll go if it’s free (normally $25).

I heard nothing Monday, nor the next day. So now I’m feeling like TV Pro Gear has let me down, particularly since there was no email or any follow up other than an acknowledgement that I had successfully filled out the form.

When I finally rang I was told (by their receptionist “Crystal”) that “Oh yeah, something happened and we couldn’t do that”. There was nobody else there to find out what had gone wrong and the only “solution” would be for me to go down to the show (and pay $25 for an exhibition of unknown quality). Crystal promised to take my number and someone would get back to me. I also sent an email to their general contact address asking what had gone wrong and requesting both an explanation and an apology.

No email and no phone call a week later, I decided to call. First call gets dropped by the receptionist; second call I get put through to “Bill”. Bill declined to tell me what went wrong and why I wasn’t contacted by phone or email. Basically, the company apparently simply doesn’t care about potential customers or their public reputation or they expect a simply “we’re sorry” – without explanation – to be enough. Bill, that is NOT enough!

Let me be clear: making promises to your customers (or readers of your newsletter) that you cannot or do not follow through on is very bad for your reputation. It certainly makes me think I’d never buy anything there because, how would I know what is true and what they are just saying to get me in, like the false promise in the email newsletter.

So, be very careful when you make promises: you better have the resources to follow through or you damn well shouldn’t make the promise because it will just backfire on you. Like this has.

Deal with TV Pro Gear, Flower Street Glendale at your own risk. It seems to me they don’t care. Of course, they could care, but simply not be competent enough to deliver.

There are lots of great Value Added Resellers in Los Angeles (Keycode, Advantage Video, New Media Hollywood come to mind immediately), deal with them and make a note to not create a disaster for yourself when you make an offer or promise.

Categories
Distribution Media Consumption

Why is Television like newspapers?

I’ve had an inordinate interest in how the news industry, particularly newspapers, are faring in the Internet age. It’s only relatively recently I realized why I thought that was even relevant to the fields I study – among them what is going to replace (or grow in parallel with) the current model of “Television”. Then it struck me…

Television is to newspapers and magazines what movies are to music.

In the music and movie models we’ve been used to, there is a direct transaction – payment is made to buy music (on disc or download) or to pay to view a movie (in a theater or by buying a DVD). This is a fundamentally different model than Television, where the content is “free” in return for your “attention” to advertising. Advertising supports both Television and newspapers and magazines.

Yes, people pay a small amount for newspapers and magazines, but that is nowhere near the cost of producing the magazine. Newspapers and magazines (I’ll just say “newspapers” from here but I include magazines) are heavily subsidized by advertising or they can’t survive. (Consider how many magazines have been closed in the last year all attributed to the “loss of advertising revenue”). Given that I don’t believe advertisers are coming back, what are the implications of the music experience for movie distribution, and the newspaper experience for television distribution. Without distribution there is no production.

The music industry has found that “infinite goods” – those that can be produced for close-to-zero (a digital copy) – has changed the market. Classic economics tells us that the sale price will trend toward  incremental cost of a sale. For music that’s zero or close to it because there is no scarcity. Scarcity, again classic economics tells us, is what drives up price: no scarcity and the price drops toward the marginal cost of producing the copy. (Yes, classic economics ignores the cost of production.)

The movie industry is finding some of the same dynamics happening, except that the movie industry has an advantage: the primary product is not the movie, but the “going to the movies” experience. Clearly the movie-going experience is more important than the movie otherwise attendance would have dropped dramatically as the quality of picture has dropped. Instead movie attendance is up despite audiences being treated like criminals with bag searches and, in some theaters, full body, airport-style scanners.

The smart people in the music industry have also realized that the business model they grew up with – where Record Companies actually had a role to play – is no longer viable. (When you have to sue your customers to “keep control” of your product, you have acknowledged a total failure of business model and you should be allowed – encouraged even – to go out of business.) So they’ve been deriving new business models that use the non-scarce good (the recorded music) to promote scarce goods – like concerts, experiences and merchandise.

Music, and movies, will continue to have “direct pay” models but they won’t be the same as in the past. (Nor should anyone who has two working neurons think the models can remain the same.)

It is newspapers and television that I’m worried about. The current models for both are unsustainable. Advertising revenue has dropped dramatically partly because of the current economic conditions, but long term because advertisers have better alternatives than renting some irrelevant eyeballs for 30 seconds at a time with a message that’s irrelevant to 99% of the audience who aren’t ready to buy your product right now.

Newspapers once provided a valuable service(s) that have been replaced by better models online. Craigslist has effectively killed the cash cow of classified advertisements because it’s a better model (free, instant). No-one really needs a newspaper to learn the session times for the local movies (available online) nor really, to decide what car they’ll buy next.

People, by and large, don’t need newspapers for news either. Not that most newspapers did that much “reporting” anyway. Surveys of typical local newspapers showed that they often have as few as five or six “real” stories (researched and written by staff reporters) not sourced from elsewhere. Most “news” comes from Associated Press, Reuters, people-in-foreign-countries, press releases, etc.

Worse, most newspapers (and television news) do not really vet their stories, taking away one of the major claims that we “need” professional journalists because, unlike bloggers, they “fact check”. (Really CBS? Who “fact checked” last night’s industry-lacky piece full of major errors on 60 Minutes?) It’s hard to make the case that the majority of professional journalists actually fact check anything. (Quick quiz – in any news story that you’ve been involved with and then seen the reporting, has it ever been completely accurate? Never in my experience, never.)

So, when the impetus for “demand” drops, and the money to produce evaporates because even the advertisers have a better way to do things, newspapers will, of necessity, die. That does not mean that great journalism will die, but it will be funded differently and have very different forms.

Television, including basic cable, is facing the same challenges: advertising revenue is drying up and unlikely to come back to previous levels, meaning the whole model is probably broken. Not this week, not next year, but long term Television as we know it is being destroyed by this lack of advertising revenue; the failure of the “players” to adapt business models, and that audiences for any given show are much smaller because there are so many choices.

What we’ve known as Television will have to evolved into a model that allows for “any program, any time, any device for a fair price” (i.e. a return that is similar to the return from advertising, not an attempt to get a 4x return as the Networks currently do with iTunes et. al).

I suspect that will, like with the Record companies and Movie Studios, leave the Networks out of the picture as middle-men imposed between producer and audience.

I don’t (yet) know what that model is going to be, or indeed if there will be only a single model, but the transformation of a nearly-70 year old business model based on scarcity (broadcast licenses) has to evolve when that scarcity no longer exists. And it no longer exists.

Categories
Business & Marketing Media Consumption

How will branded media replace advertising?

On last night’s Digital Production BuZZ, host Larry Jordan quizzed me on why I thought advertising was doomed and what would replace it.  I’m including the 6 minute interview here because it extends the thinking in my previous post on What will replace advertising? from a couple of days ago.

Philip Hodgetts on how branded media will replace advertising.

Update: Larry Jordan continues the conversation with his post: Where Are All the Ad Dollars Going.

Categories
Business & Marketing Distribution Media Consumption New Media

What will replace advertising?

Over the last two years I’ve been thinking extensively, and speaking on, about funding new media. (Want me to come speak on the subject at your group – email me!) It’s become increasingly obvious that advertising probably isn’t the way the majority of media will be funded in the future.

In the (relatively brief) period of mass media – Television, newspapers, magazine and radio – the publisher or license holder built an audience and then sold that audience to advertisers to push unrelated products and services to the audience who mostly didn’t care. With 70% of Americans desirous of paying to avoid advertising (counting me among them) you have to wonder how long the tedium of irrelevant advertising will be tolerated by audiences.

Even the web is a horrible experience unless you are smart enough to enable ad blocking and Click2Flash (Flash blocking in webkit displays system wide – OS X only afaik). With those two add-ons enabled the web doesn’t burn my eyes with the pain of flashing, jumping, irritating distractions. If my failure to ruin my experience of a site by blocking the ad sends the site off the net, so be it. I didn’t ask for the advertising.

Technically, of course, it’s not all advertising that’s horrible, just irrelevant advertising. Like watching a 45 minute show on Hulu and seeing the same fabric softener ad five times!!!! And Hulu has the temerity to complain that I’m using ad blocking! People don’t really mind relevant advertising, but so little of it is! In fact, for me about 99.9% of advertising is irrelevant. In maybe 200-300 hours of in-car listening to KNX1070 (LA News radio) I’ve heard one ad that was relevant (Windscreen chip repair). That is the only ad that doesn’t carpet KNX wall to wall! (Figures!)

So, I have a fairly hard-and-fast rule that I don’t buy from anyone who advertises to me. Send me junk mail, go out of my purchase consideration list.

Anyhow, I’m not alone. Not only is advertising losing its effectiveness, it turns people off (and yes, I have references for every assertion I make, I just don’t want to clutter the blog) and that’s just not going to be a way to build an audience.

But there’s a much bigger problem. There’s not enough advertising for any “new media” and “old media” is losing advertising support in dramatic amounts.

But most relevant of all. Advertising in someone else’s show makes no sense. The biggest advertising brands would be much better off with branded entertainment, where they would pay for the content and integrate the advertising. American Academic Mark Pesce, now at the Australian Film, TV and Radio School, coined the term “Hyperdistribution” where a single sponsor integrates ads relevant to the show’s audience and in the style of the show, and then it’s distributed anywhere and everywhere it can be. P2P and Bittorrent distribution is welcomed!

My friend Cirina Catania worked on a very successful series of branded media (online video) for Chivas Regal and I believe that this is the direction of the future: useful, interesting content that is, in some way, relevant to the brand and hooked back to the brand. Why torture audiences with irrelevant advertising when you can entertain them and still get the brand message across in a relevant way?

I’m clearly not the only one that thinks this. I recently found a great presentation called (correctly) The Audience is always right. Check it out and then make a comment.

Categories
Video Technology

What is drop-frame Timecode?

Although I come from a country where we count frame rates in whole numbers and, therefore don’t need to skip frame counts in the timecode, I thought I understood it at least as well, or better, than “NTSC natives”. That is, until I really, truly had to understand it to ensure the reported time counts in Sequence Clip Reporter are accurate.

Well, it took three pieces of additional information before I truly understood it: Rainer Standke’s insistence that “frame is a frame is a frame”; the realization (although known) that 29.97 is actually slower than 30 fps with the consequence that each frame runs slightly longer than at 30 fps; and that the correction can’t be applied evenly.

At one level I knew all of these things, but it really all came together when I got the “right” mental picture. Since I could not find any illustrations that showed why the skip-frame timecode (a better term than drop frame imnsho) needed to skip frames, I decided to create this one. It’s licensed with a Creative Commons – Attribution license. That means you can reproduce it, or use it for any purpose as long at the attribution to me remains.

Not shown on the image is that the 2 frame skip-forward happens at every minute, except ever 10 minutes. There are other parts to the pattern as the timescale gets longer.

Click on the image to load the full size.
Click on the image to load the full size.

Categories
Assisted Editing

Snow Leopard Compatibility

I’m very happy to announce that all of our Assisted Editing software is now Snow Leopard (a.k.a. Mac OSX 10.6) compatible.

Even better, along with the speed improvements from running on Snow Leopard, Greg also improved the XML parsing speed so all the apps should be very noticeably faster.

These updates are free and can be downloaded from within each piece of software, using the built-in updating framework, or you can simply download the current version from Assisted Editing and overwrite the current version.

Categories
Business & Marketing

Why do I love our customers?

As I transition into a role I never thought I’d have – software product manager/developer – I’ve come to love “pushy clients”! Although I don’t write the code for our products, I’m usually involved in the design and particularly user interface. Greg writes the code rather brilliantly.

Our first piece of software – driven by a strong idea of mine – is First Cuts - the assisted editing tool for long form documentary filmmakers. Finisher was the suggestion of Loren Miller during the beta period, and the use of Sequence Markers to force b-roll was the suggestion of Digital Production BuZZ producer, Cirina Catania.

The work we did there gave us a leg-up with FCP XML so when Ted Schilowitz of RED Digital Cinema asked if we knew someone who could, basically, create something functionally similar to Avid’s Autosync (part of Media Composer) for Final Cut Pro users, leading to Sync-N-Link a few months later.

Later than intended because we were about ready to release it and ran the concept past Jim Mathers of the Digital Cinema Society and he said that in the independent markets that he works in, editors tend to sync multi-track (dual system) audio after the edit. Dang a delay but Greg made it happen. That’s something you can’t do with Media Composer.

If, however, you compare Sync-N-Link then with the current version – set for a substantial update shortly – there have been so many new features added, and bugs fixed, that we could not have found without our early customers. We did try beta testing but found that few beta testers have time to put into testing, despite their best intentions. (Which reminds me, “sorry Boris for not much feedback the last two times I tested for you”.)

Likewise, the whole Sequence Clip Reporter application came about because I had demonstrated miniME and exceLogger at LAFCPUG. A friend said “what you really should do…” and we did. Then we had some great feedback from (yes) a beta tester and fabulous feedback from an early customer, who was “I love it but could it also….” and now it does.

Sequence Clip Reporter was only released about seven weeks ago, and yet it’s now at version 1.5, with an interface overhaul (more feedback) and a raft of new, customer-driven features.

So, if you use a piece of software and have a feature request, let people know. Everyone who develops software loves to know how people use it and how they can make it better – yes, even Apple, although they’ll never tell you. (Someone reads, categorizes and files every feature request and bug report.) In fact, FCP XML v5 has a bug fix for a problem Greg reported (from a customer) and a new feature that also came about because we couldn’t accommodate a feature request from a customer. (Sound reel was not being exported in the XML until V5.) So we know Apple do respond.

What I particularly enjoy is that we’re not a big company, where it takes time to iterate a new version, QA it and get it out. And thankfully none of our applications are (yet) anywhere near as complex as the simplest Pro App or NLE. It’s just so great to get a feature request from a (potential) customer and have the first (very rough) draft of the app by the next day. (There’s a huge gap between that working prototype and a full application, not all of which is to do with the function of the app.)

Or get a feature request from a customer – or a problem they have – and being able to push out an update for everyone within a day or two days. Or even solve a problem that isn’t caused by out software, but where Greg’s XML expertise is able to “save the day”.

So, provide that feedback. Tell people how you use their software (tell us for sure). It’s likely to gain you a feature, or even a whole application.

Categories
Video Technology

What to use to archive non-tape media?

When Larry Jordan sent me out on the Exhibit Floor to find out what Panasonic, JVC, Sony and hard drive manufacturers recommended for long-term storage for non-tape media, and the answer surprised us both: Blu-ray.

Here’s the interview from the Digital Production BuZZ where I explain my findings.

Categories
Business & Marketing Distribution Item of Interest

Why do I have two inconsistent positions about copyright?

Just lately I’ve been dealing with a content aggregation site (or two) that had articles from this blog listed in their articles directory. Worse still is that the site is designed to distribute articles to other sites. I don’t mind the idea: if a writer wants wider distribution, then it probably makes sense to syndicate the article there, than have it sit in obscurity.

I had to fight fairly hard to get my articles out of their system because I had not put them in that system and didn’t want the articles syndicated wildly. Now I do have some syndication organized (if you’re reading this on Toolfarm, thanks) but I don’t want this content distributed anywhere I haven’t directly authorized.

The articles were removed but only after I re-served the DMCA takedown notice on the owner of the domain name, as the normal site admins were not acting in according with the provisions of a DMCA Takedown notice. (I actually thought I’d have trouble when I realized, from the domain registration, that the company was actually in Israel, which isn’t actually covered by US Copyright law! Fortunately they did the right thing.)

We were talking about this over dinner and I realized I had a double standard going on. Not necessarily a bad thing but any internal inconsistency is alway s worth examining.

I was remarking that I am fairly certain there’s at least one school or college that’s using my HD Survival Handbook as a class text, which is not exactly being used in accordance with a single-user license that is the normal purchase. (BTW, we’re always happy to do very attractive bulk pricing for anyone that wants to reuse in a school or commercial organization, as we did recently.) But the thing is I wasn’t particularly upset by it. Sure, I would prefer that they made an arrangement with us for official distribution, but the thing is, I didn’t have any proof that they were doing something wrong. There may be a way that just the teach uses the work as a reference.

If I had actual proof put in my face – such as a student saying that the HD Survival Handbook was actually on a student-accessible server at her college – I would have to act. (In that case I sent a nice email to the original purchaser at that college stating what the student had said and he immediately made it right.) When I say “have to act” I actually mean it. Should an author not act on flagrant breach of the licensing conditions, there are circumstances where the author can lose the copyright exclusivity.

So I was struck with my apparent double standard. I am less worried about meticulously keeping the commercial writings only to those who purchased, than I am about these thoughts being widespread.  Partly that was because the instance with the aggregation site did not have link-backs to this site – the uploader had substituted links to their site, and the content was misused – wrong tags and confusing descriptions. My name even appeared on an article I didn’t write! But it’s also because a lot of what I write here are the beginnings of my thinking about something, or they’re going to be (or have come from) commercial writings.

Mostly, I think, it’s because the commercial products were written to be distributed widely. Plus, if there is a whole class or two that are using my work as their textbook, I’m still being compensated with reputation building. I’m not unhappy with the thought that a whole generation of student will grow up thinking that I provide accurate, understandable and useful information. I figure that will lead to some compensation some day. The portion that does pay for the downloads, and I like to think that’s the majority, make the project well and truly worthwhile, and frankly, I don’t think those students would have paid anyway! Whatever money a student has should be kept for the truly important things… 😉

Here though, I’m writing as much to clear my thinking or have a record of something I’m fired-up about as anything. I don’t have advertising on the site and don’t expect it will be a commercial return. I do hope that it’s reputation building, and when you reproduce this work without authorization, you’re taking my reputation and using it for your own purposes. And I don’t like that.

PS

What I consider highly appropriate is to make reference to a post, summarize the main points – perhaps quote a paragraph or two – and then link to the permalink for the article here. (Click on the article headline and the URL will be the permanent link.) That type of use is a compliment.