Why do some movies do well and others don't? There are a lot of reasons. But if we were to simplify, there are 2 things that matter more than the rest.
1. The buzz factor.
Reason why studios pay $20 million to a well known celebrity is because they know it will generate the buzz and create expectations.
2. The story and the experience.
Once the movie is released, and the first wave of viewers go and watch it, then it all depends on how good their experience was - for the buzz to sustain.
To beat Hollywood, you have to become better than them at telling good stories well, and creating buzz that lasts to make money out of it.
You absolutely have to become good at monetizing the buzz. Only selling the movies for 99 cents is a bad monetization plan. You will never be able to fund a movie like Avatar. And if you can't do that, you'll never be able to take on Hollywood.
If I were to develop a plan to beat Hollywood, it would center around creating buzz. How to use the new media to generate buzz.
Maybe create a new incentivized market... a whacky idea like: the first hundred thousand people who watch a movie can share in its profits.
I don't have to make an Avatar to beat Hollywood. That's fighting fire with fire. We can fight fire with water. If a consumer watches one of my studio's productions instead of watching Avatar, we didn't just earn $0.99 -- we also stole a $10.50 purchase from 20th Century Fox.
I'm betting that when given a cleaner, more enjoyable alternative to the mandatory commercials, overpriced fatty junk food, and general awfulness that the current moviegoing experience has degraded into, we can steal a fair amount of business.
That's not how the economics work. Consumers have a level of disposable income. Just because they spent 0.99 on your movie doesn't mean that they won't also spend $10.50 on Avatar. The allocation of disposable income is not based on price as much as quality.
Secondly, $0.99 vs $10.50 is a failure in signal theory. You immediately signal to the consumer that the value of your movie is far less than most other forms of entertainment. The reason why the $0.99 model works for music on iTunes is that all songs are priced the same. There is no signaling of quality between songs. The 99 cent model works for iPhone apps is that it is low enough of a cost to value to risk ratio that it's worth 99 cents to try something out. If it is bad, there's no real loss to it. There's little opportunity costs associated with it.
But you can't sell a $10M budget movie at 0.99 and make a reasonable revenue.
The number of movies people see isn't limited by their disposable income, it's limited by the number of movies they want to watch. If they get one for five dollars instead of twenty they're probably going to put the change on their mortgage or their car, or maybe their spending on food will increase as they realise they have a little more money to play with.
What they won't do is go to four times as many films as they otherwise might. I'll grant that demand is elastic, but it's not a linear relationship. Reducing the cost of film viewing in this way will absolutely reduce the amount of money spent on it.
(That disagreement aside, I think the rest of your post is pretty reasonable.)
You get checkmated here by the Holly wood buzz machine.
People will go with their mainstream aware friends for the major holywood release over your movie. They will watch your movie independently, later.
As has been said in this thread, the only real competiton is time - Holly wood is dying already, because they are fighting for time, which is being eroded by video games, mmos and the likes of zynga.
Why would the consumer not just watch movies from Fox too? Especially since if he only pays you $0.99, he'll still have plenty of money left to give to Fox.
Book your assigned seats online, buy alcohol and quality food there or bring your own, no children at many showings, no ads, etc.
This is a very important and overlooked part of their machine. The cinema distribution model. If I remember correctly Hollywood charge an astronomical amounts to theater for showing their movies, I think it eats almost 100% of the ticket price. Cinemas then make their profit by selling overpriced popcorn and sugary water.
A new start-up could also focus on an alternative distribution model aimed at smaller theater with more reasonable license prices. This way theaters could focus in the movie experience instead of selling crap to noisy people.
My point is I think the strategy can succeed against Hollywood. Who knows, we might even start seeing innovative movies out of this. Right now 75% of the movies released every year are remakes or sequels. Not a whole lot of innovation.
To "kill" Hollywood people need to address the costs, not the money raising. Crowd sourcing $1m is close to impossible, crowd sourcing $1m on a regular basis is even harder and crowd sourcing $10m+ on a regular basis? never going to happen. Even if it was achieved once or twice, as soon as a movie doesn't meet expectations the idea will fall apart, if costs are reduced to much lower levels, losing a crowd sourced $500k because the movie sucked is much more palatable than $10m.
- Studios charge production overhead fees in excess of 35% reducing significantly the amount of money spent on the actual production
- Studios charge interest in excess of 20% on all expenses incurred in development, production and development
- Producers are required by the studio to contract with vendors they either partially own or have pre-negotiated rates with the studios
- Example, Technicolor pays Universal $25 million at the beginning of the year to be the exclusive lab for all Universal productions. Then Technicolor charges inflated rates to Universal. The $25 million offsets this and the result is the production budget is artificially (i.e. criminally) inflated.
- Example, studios may make a producer pay 40 cents a foot for negative film processing vs 15 cents normally, or up to $4 per foot for release prints vs $1.50. (this data is old)
- A fair system using digital cameras and related technology (e.g. visualization, digital 3D mapping), along with digital distribution to cinemas, should reduce the production and distribution cost of a major film to a few million. +advertising
Same things happens with marketing. The studios will advertise a film through their TV network, all while controlling the prices and limiting net profit participation for the outside investors and producers. All this is a clear case of financial fraud and is known as - http://en.wikipedia.org/wiki/Hollywood_accounting
The music industry works the same way, in regards to the actual content producers.
I think Hollywood can only be killed by a thousand cuts. Make websites, companies or tools that do one thing very well, and better than that part of Hollywood. Then, when enough of these companies are built to replace every part of Hollywood, this whole cluster of companies can end up killing Hollywood.
Props and wardrobe could be revolutionized with cheaper CNCs and apparel machines and better and cheaper creative content design software - which is being currently done (Zbrush + DIY CNCs), but someone still has to design the stuff.
1. Get a group of wealthy investors to select a well-known director and film that they would like to support. Ideally the people in charge of the creative side would be open to trying alternative business models.
2. Try to work out a reasonable budget to produce the movie. The overall cost should be much less than usual due to the complete lack of middle-men.
3. The investors provide funding to create an awesome trailer for the movie.
4. Using this trailer, the movie producers crowd-source funding for the movie. If this funding falls short, the investors are obligated to cover the difference. However, if the funding exceeds the movie's budget, the investors are rewarded accordingly.
5. The movie is completed and released into the public domain.
Hollywood has backed itself into a corner using the exact same methodology that you outline in your new studio: both assume that films are widgets, and great ones can be reliably produced with high frequency if the secret formula is discovered. No such formula exists. Every film is a one off, and many of the biggest hits were perceived as certain flops before their release (Star Wars), just as many sure things have tanked (Cowboys & Aliens).
As I've said before, the solution isn't to become more cautious, but more bold. You studio should be based around locating new, young talent (writers, directors, actors and producers), giving them steady work in exchange for reasonable salaries (kids right out of film school are thrilled w/ $30K a year) and creating an environment where said talent can work on a high volume of projects over a short time period with limited commercial risk. No one should ever feel that failure on any particular project will result in a ruined career - the omnipresence of that fear is what has given rise to timid film-making in the mainstream. Projects should be shot in under two weeks, and should have budgets ranging from $10 - 100K. You should be designing your studio to accommodate modest returns, while accounting for inevitable flops. Never presume you know what will sell, and you might make it.
Film-making isn't a business. Film-making is an art. The best art is achieved via iteration: practice, release, refine, practice, release, refine. Build a studio designed to lose money for two years. In the first year, plan to attract at least 50 young directors, 100 young actors, and 100 young writers. There's no shortage of talent in LA (300 hungry young artists step off the bus in LA every day) but sifting the wheat from the chaff will be exhausting. Do the work, it will be worth it. Build a production schedule geared around low budget genre films, produced in 12 days and costing an average of $35,000 a piece. Ideally you'd be releasing 50 - 75 films a year. Over the first two years of your studio's existence, you'll have released 100 - 150 films. With each film, you'll be able to try new and different release and marketing strategies. You'll be able to gather detailed audience feedback on each film, and at the end of that two years, with a mountain of data behind you, you'll start to have a very strong idea of what sells and what doesn't. What kinds of films your audience is interested in, what kinds of actors, plots and situations they enjoy, and how you can produce films with those elements in the cheapest, quickest way possible. In the third year of your studio's existence, you might start to break even. In the fourth year, every major studio will be begging to work with the radical young talent that your studio has done such an amazing job at cultivating.
In other words: Step One, collect underpants.
Filmmakers typically fund their own films for about US$20,000 and shoot in one week. Over their career filmmakers may direct 100-150 films. New movies are sold in street markets on video CD and VHS directly to customers. Piracy is not a big worry when a director is releasing new films every couple weeks.
For more info, I recommend the documentaries Nollywood Babylon, This is Nollywood, and Welcome to Nollywood.
DreamWorks had come close to bankruptcy twice.the studio suffered a $125 million loss on Sinbad: Legend of the Seven Seas, and also overestimated the DVD demand for Shrek 2.In 2005, out of their two large budget pictures, The Island bombed at the domestic box office, while War of the Worlds was produced as a joint effort with Paramount. They eventually ran out of money. DreamWorks scaled back, stopped plans to build a high-tech studio, sold its music division and got out of the distribution business.
They eventually ran out of money and sold the company to Paramount pictures. The deal was valued at approximately $1.6 billion, an amount that included about $400 million in debt assumptions. it's a lot harder to start a studio than you guys think.
Of course, there's Pixar. but you need a SJ and a John Lassetter to create something like Pixar.
In terms of scale, Dreamworks was designed to compete directly with the majors. They focused on tentpole pictures produced at Big Six scale. Even with their substantial financial backing, this meant that a single flop could (and did) jeopardize their company. Corman's films, on the other hand, with their minuscule budgets needed only draw a fraction of the business of a Dreamworks release to make a profit and so very rarely (if ever) showed up as a "loss" on his books. Corman's films rarely hit it big, but because of their relative costs, they never had to. Modest returns were sufficient for him to draw profit margins astronomically beyond those of the majors.
In terms of intent, Dreamworks was set up primarily to produce and release the films of its founders, who tended to trade in prestige films, and their desire to produce only Oscar-level films tended to paralyze their production ability; excessively high standards ruined them. When they did get a film off the ground, they tended to bet too large (out of desperation) and lost as frequently as they won. The exact same thing happened to Coppola's Zoetrope when he let himself run amok on One From the Heart.
The lesson from Dreamworks (and Zoetrope) is to manage your risk. Never put yourself in a position where a single failed project can ruin you. Similarly, never produce a film that requires broad mass market success to avoid total financial failure.
>never produce a film that requires broad mass market success to avoid total financial failure.
You'll avoid financial disaster but you'll never "destroy" Hollywood with this mindset. Copolla and Roger Corman disrupted the movie industry but they did not "destroy" Hollywood.
You won't destroy Hollywood by creating a few new studios. But you might change it. That's really what people want to achieve.
Anyway, you've named some of the best high-budget movies over the last 10 years. They don't release an Avatar every month.
And then you have to convince millions of moviegoers NOT to watch high budget competition such as Dark Knight Rising, Transformers, Twilight, Spiderman, etc.
Then you need to have something Millions of people want to watch this is the hard part :)
And then you'll kill Hollywood.
Small studios don't need as high a return.
This is in many ways a Clayton Christensen (The Innovators Dilemma) opportunity.
Producing high quality movies as ultimately a question of people and skills. There are plenty of both that can't get work anywhere else.
I don't understand why I would have to convince people to not watch those movies? They are still being sold today and people are still watching non-hollywood movies.
If it becomes impossible to be profitable with big productions then hollywood will kill itself soon enough.
In total, producing our studio's first 75 films would cost $5 million dollars LESS than the total production cost of just one of this weekend's wide release films (in this case, Haywire, made for $23 million). Go see Haywire, and think to yourself about a) whether that movie really needed to cost what it did (bear in mind that the majority of its costs were sunk into the logistics of shooting abroad in multiple Euro locations and filling out its secondary cast with A-list talent; were the locations and secondary cast essential?) and b) whether or not you might have been more interested in the film had it been produced w/o studio constraints (meaning more nudity and explicit violence; a "hard R" or NC-17 as opposed to the film's "soft R" rating).
As I mention below, there's examples of companies that crank out product quickly and very cheaply (UFO, Asylum, etc), but they really don't care much about quality.
But set up something like this with some people who could aim high on low budgets, and with say 5 million bucks over 2 years turn out 100 films. None of them would be blockbusters, but some of them would find substantial audiences.
Self-distribute online, set low per-film purchase prices, and maybe some sort of subscription for the true fans. Work hard to get the breakout films to wider distribution. You would break even in time, even if only 1 in 10 films were hits.
Experiment. A/B test. Set a culture of innovation. Invent processes, gear, whatever was needed to produce the films faster and cheaper. Be the lab.
You could actually hire pretty pro crew for below the line work since you'd be spreading the cost of any individual over say 20 films a year.
You'd lose above the line people along the way. The super talented would get picked up for more money elsewhere. That would be factored in, though, you'd just bring in new people. And the films that brought the people that left their fame would just be worth more then.
There's nothing I'd rather do more than exactly this, personally. It'd be fun and full of great challenges and rewards.
You also mention how looking at data is impossible for artistic endeavors like film making, then turn around and talk about mining data from your releases. I actually tend to think your original comment, that you can't mine data, is accurate. Any model to kill Hollywood is going to have to deal with the fact that some films will go viral (what the Internet calls a blockbuster) and others will tank.
Every indie studio has a worldwide distribution mechanism. It's the web. Stream to laptops, Roku boxes, apple tv, Google tv boxee tv etc. build audience on there and if you're popular you can get into traditional distribution channels.
Imagine a film-making business with the same allure for arts graduates that Google etc have for comp sci graduates. Like you say, being payed $30K+ straight out of film school is quite attractive, especially if it's at a place famed not for the politics and ladder climbing of Hollywood, but for creativity and freedom. A place where you get to try out new things and be bold with your art. Maybe even have a 10% project...
If you're saying that there's no market for compelling stories efficiently told, then we better batten down the hatches. I'm pretty sure Revelations lists that as one of the six signs of the Apocalypse.
Your proposed ideas are, in fact, almost exactly what I had in mind with my original post (though my arbitrarily chosen $10M example may seem contradictory). I'd like to discuss further.
Assuming that really is the best model for the future, how do you prevent the new Hollywood from turning into the old Hollywood again?
Interesting. I greatly enjoy tacky high school / college movies (think American Pie, Superbad, Fired up!, that kinda thing), and I would love if there were a LOT more of those on the market. I can't imagine that they are very expensive to make either.
EDIT: My big thing is that a kickstarter like project wouldn't be geared around in-house talent. That's what made Roger Corman (and the golden age studios he modeled himself around) special. All the talent was under one roof.
In addition, if the only distribution model is online streaming at 0.99, you'd need to sell 10M views to just break even. Yes, this can be achieved for a single hit, but for every single one to break even is similar to the current model.
One of the key things with the internet and technology is that:
1) Technology has enabled talented artists, filmmakers, and musicians to produce high quality content at a reasonable costs. Take a look at all the quality production that is around on the internet.
2) The internet has enable low cost distribution and discovery service. This means that we can increase the number of distribution channels for much lower cost than the existing model.
Because of these two facts, this enables smaller productions (you don't need $10M revenue if your cost is $30k) and more niche audience. Think of all the long-tail movies that do not get made because the target audience is too small; these would become economically feasible with internet distribution.
The indie film industry follows this similar model. A lot of indie films are low budget films made by students and budding stars. These films and talent are then discovered by the big budget studios and brought into that fold. (Think of the indie film community similar to the open source community in tech.) They are often looked down upon by the big budget studios and the community is looking for that one opportunity to break big. They have as much distaste for the Hollywood model as the tech industry does. There is a huge opportunity in bringing them into the fold of the startup industry to counter Hollywood. Provide them a clear path of success without giving up much of their rights or stake and they'll surely jump at the new approach.
Lastly, the internet is a great talent discovery. Look at the number of mega stars that have been found on YouTube and other websites. The problem is that once someone becomes "Internet Famous", how do you turn them into "Real Life Famous". People like Justin Bieber have no choice but to fall into the hands of the existing production model.
Provide your consumers (in this case the movie production and the movie consumers) with a better product and all else will follow.
1) Embrace the Indie Film industry -- they are desperately looking for a partner in taking on big studios. They have already been in this fight for years, that we have only recently just joined.
2) Use technology to assist in discovery.
I think the way the OP wants to monetize it wouldn't work well either (and with their method file sharing remains a problem rather than a benefit). If indie films were also able to partner up with theater systems (like Regal) they could charge less for public performance and also lower ticket price. Having theaters as a main source of income also allows file sharing after release to benefit the performers and directors for their next films.
I can think of a few popular books that I would loved to see get turned into movies. Their fanbase alone would make these minor successes.
Right now the people who distribute the content are also the ones who own the rights to it. That is why you have seen such a move towards limiting the rights given to consumers of the media. There was a time when a movie house bought the reel of film and played it as much as their hearts desired. they actually made money off the tickets. That was then shifted to have the theaters pay a portion of each ticket sold to view the movie , removing the ownership right of the theater. Now the theaters don't own the movies, make no money off tickets, and are dependent on the studios for all the marketing. If you as a theater owner tried to buck the trend they would just stop giving you the privilege of screening their films and your out of buisness.
There is a great symbiotic relationship between theaters and studios that just making new content won't disrupt. If you want to "kill hollywood" you need to focus on that problem first, once content delivery and distribution are separated you will open the market for a new generation of content companies.
Of course "we" could improve on the algorithms, but such a thing is not a startup idea in my opinion. A startup idea would be a specific way to improve upon the algorithms.
There's nothing that sophisticated at work, I assure you. Hollywood has "creative executives" who read the scripts agents send them, and then evaluate those scripts by hand. Some are better at this job than others. Some are legitimately good at it. (Full disclosure: I held this job for 5 or so years of my career; I'd say that I was ok at it).
Scripting is done the old-fashioned way, as well, by humans using specialized word processing software (Final Draft for screenplays and teleplays, Scrivener for novels). This software helps writers sort through some of the elements they've been using, i.e., by saving character names and locations, and returning those names when called. And the programs have templates and auto-formatting. But nothing that actually does the writing for you. Not yet, at any rate. (Full disclosure: my brother is a screenwriter, and he's pretty good at it).
The challenge is that Hollywood does not have a halfway decent way of predicting or forecasting what will succeed and what won't. It is possible to judge good work from bad work, and to coach writers in improving their work. And there are "rules" of story structure, plotting, and so forth. But these are just structural. Very few people have any sort of gift for making calls about what will, or will not, succeed at the box office or on TV. Sometimes legitimately great material fails, and often legitimately atrocious garbage succeeds wildly. It tends to be a crapshoot.
I would suggest that, if we're interested in disrupting Hollywood, we stop focusing on a hypothetical, universal audience, and start focusing on niches. We have the technology now to deliver content to those most interested in seeing it. Netflix, Amazon, etc., do a very good job with collaborative filtering. The future of the content distribution business starts with interest-based segmentation, IMO. The sooner we move away from people's best guesses as to what will work for whom, the more readily we can adapt to the delivery methods already at our fingertips.
Since you evaluated scripts for a living, can you tell us some of those rules?
A few tidbits, and by no means comprehensive:
- Typical screenplays weigh in at around 90 to 120 pages, and most of the time, execs prefer a screenplay to hover around the southern end of that spectrum.
- A screenplay usually follows a three-act structure. If we take a 90-page (roughly 90-minute) screenplay as a template, then the first act is the first 30 pages. The second act occurs from roughly pages 30 to 60, and the third act roughly from pages 60 to 90. Typically, there's a key turning point or reversal halfway between each of those acts, too.
- The stakes get higher as the story progresses. The protagonist makes a crucial decision around page 30 which sets him off on his adventure. Shit hits the fan between 30 and 60, at which point, the protagonist realizes what he must do to resolve the situation. But then shit gets even worse, and the hero's in serious peril (physically, emotionally, or what have you). The final ~30 pages represent his final push against the antagonist(s), with a climax occurring around page 75 to 80, and a denuement from 80 to 90.
- Each scene must move the story forward in some meaningful way. This doesn't have to be overt or action-based; even a dialogue between two characters should create and then resolve something. This can be very subtle, and it's hard to notice in films. But the difference between a scene that moves, and a scene that drags or is pointless, can become readily apparent when reading a screenplay.
- Subtext: characters have personalities, goals, motivations, agendas, desires, and intentions. They don't overtly state these goals or intentions in dialogue. Two hallmarks of bad dialogue are 1) expository dialogue, i.e., dialogue that serves little purpose but to explain things; and 2) dialogue in which characters broadcast their intentions. Characters speak in their own voices. In bad dialogue, all the characters sound the exact same. In good dialogue, the characters have different ways of speaking, seeing things, etc.
- Good plots involve interesting characters that make interesting choices. The plot stems from the actions, or reactions, of a character to his circumstances. Things don't just "happen" to the character. He makes choices, and what happens next is a consequence of those choices.
- As a corollary to the above: interesting things happen when good characters make bad decisions. Think of Frodo and the ring of power. It would have been a pretty boring book (and movie) if he'd just kept the damned thing in his pouch the whole time and never put it on, right? In fact, I'd recommend Peter Jackson's first of the three LOTR movies to anyone wanting a crash course in screen plotting. It's a long movie, and it does slow down from time to time, but it's amazingly structured. Nearly every scene flows logically from the next, and in a subtle way. Every scene is the result of someone's decision, and the tension escalates accordingly.
- The Golden Rule: show, don't tell. Don't use expository dialogue as a substitute for action (and, by "action," I mean characters making interesting choices and doing interesting things. "Action" does not necessarily mean fight scenes or car chases). Don't use narration if you can avoid it. Narration is lazy. Sometimes people have broken the narration rule to great effect (i.e., when you have an unreliable narrator, or a narrator who provides humorous color commentary) -- but 9 times out of 10, narration could have been better substituted by story.
Matt and Trey of South Park describe this brilliantly here:
(Just brace yourself for the annoying "OMG it's Matt and Trey" production of the clip.)
Regardless of what your thoughts are about Hollywood, it's filled with a bunch of very intelligent, and very well connected people, with very deep pockets.
Iterative improvements here and there is not going to cut. Posts like these are obtuse show a general lack of understanding.
The reason it's misguided is that Hollywood isn't the problem. The problem is the system of lobbying the government and the way the government operates to respond to this lobbying. Killing off Hollywood and replacing the dumbass IP protection fanatics with Hacker News will look like the same old problem of replacing one form of tyranny with another.
As a footnote, given what one assumes to be an audience including a lot of system analysts, the near-complete lack of this point of view is making me doubt my sanity. ;)
The problem we see is wrong headed thinking around distribution. Everyone wants to be an event, to drive TV or blockbuster sized audiences for a quick big win. The Internet isn't about that. The Internet (see amazon.com and books) is about breadth and depth of choice, made available to a wide enough audience that the quality of choice makes financial sense. Monetize that, and you've defeated Hollywood.
The other two thirds of the story are the international market and merchandising.
Even the worst film end up making money abroad. And those markets don't necessarily have access to the web. So addressing the how of international distribution (the non-web answer) will be a must.
And then to be genuinely disruptive, the last third of the solution needs to address merchandising. There needs to be a clear path for everything from action figures to cereal boxes. This one can't be done in isolation of other markets so an alternative ecosystem needs to be created.
I have a popular documentary site which has been around for many years, streaming full length docs for small beer, it pays the hosting costs basically. But what I learned over the years that in order to survive (i.e pay the bills as hosting / streaming content is relatively expensive) is that you have to adopt the Megavideo model, i.e charge for content only after people are addicted to it. They used to force payment after 60 free minutes. I struggled to make any cash with a paywall system and only when I switched to pay in video system did it start making money. Clearly the megavideo model worked as they had 6 million in assets ceased apparently (poor sods).
I built the concept out into a standalone system in Flash and its at karsa.co.uk but for these days it would need to work in html not flash.
Instead, I think a price closer to renting a movie on demand would work better with a bargain price for each view after that. Perhaps $2.99 or $3.99 for the first view and $.99 for each view after that. And then maybe when the viewer gets up to a certain view count, each view after that is free. This way, you can gain a profit with less viewers while also instilling loyalty in repeat viewers who are most likely to spread the word.
Propaganda is something we aren't the best at, but Hollywood most definitely is. They might be aiming at destroying the tech/internet industry but they have been very cautious in choosing the right wordings so as to avoid any direct attacks (except a few who patronized 'nerds'). Even if they are using old school cliches that mean nothing if careful deductions are used, but most people would not care taking the effort. Most people would see that there are two groups fight - one that says they will save American jobs and livelihood while preventing them from illegal drugs and their children from pornography while the other group is trying to kill and entire industry. Sympathy can be a very strong tool, especially in elections (I am just saying this based on movies/popular culture - I have zero first hand experience about US elections/political atmosphere).
We should probably be careful that we do not end up just winning battles and lose the war - and there is no way that this is going to be a short one.
I've said it before and I'll say it again. Each movie or TV show is a startup, even if all are within a single studio/production company. You can't magically run out of budget and simply ask for more money. When that happens, you might get money to finish up, but you'll also be out of work and you get managed until project is finished. Every single item gets budgeted. Most money drains happen when deadlines are slipped, since when freight train of principal photography starts it costs serious money to operate and can't be stopped. Sometimes it can really be out of producers control (special weather needed, permits suddenly in trouble, actor dies...), but it rarely happens and every major production has insurance coverage for situations like that... but when it happens you get managed. And nobody likes that, it can tailspin the situation towards evil and gets your rep tarnished.
Also, $0.99. While it would be nice, simple arithmetic calculations on average budgets and viewings sing a different song.
I'm not sure if this was intended or not, but I think you are describing YCombinator for Movies + a distribution platform to support it. At least as I read it, these are the two strong thoughts that come to mind. The biggest issue with Hollywood is its lock on distribution chan
nels - this is where the biggest opportunity for disruption lies IMO.
Perhaps YCombinator + OpenHulu(API) is the magic you are looking for? Keep thinking, I think this is in the right direction.
The best example of how to "Kill Hollywood" is Louis CK. What used to go to middlemen like distributors instead went directly into his pockets, and it decreased the price for his fans.
The content providers, like Louis CK, need to come up with their own money, and then they get all the money. Take the distribution networks out of it. Charge fans a minimum amount of money, ie. $5.
The only difficulty with a movie is that the "content provider" is very distributed. There's the writer, and then there's the actor, etc. With Louis CK, it was all the same person. With a movie, it's a lot different. Not sure how exactly that would be split up, but only because I lack any familiarty with movies.
However, funding movies could use the concept from HSX.com where you can buy shares in a film before it comes out. The value of the box office receipts ultimately is split up amongst all the shareholders, etc. This would create incentive for people to get a prospectus for a movie, ie. the script, the actors, etc, and then make informed decisions and buy shares of a movie. This would give funding to the movie, and also create a good secondary market for people to gauge how well a movie will do.
The problem that "Hollywood" solves isn't simply financing and distribution, it's letting lots and lots of people know that your product exists and convincing them that they really really want to pay lots of money to see it.
What series of incremental improvements (an inevitable wrong-turns) will bring us to that next paradigm of entertainment and culture? Will screens necessarily be part of the equation for that next leap? Will we accept passively soaking in this media, or will our participation be required?
We can think of experiences like ST:TNG's Holodeck or Neuromancer/Snow Crash's plugged-in immersive metaverse as science fiction, but so was the idea of full-color screens that respond to your gestures or verbal commands not so long ago. The YC challenge to all of us dreamers is what intermediary steps are needed to make a Holodeck a reality? Then, how do we start building the first of those?
- Let's imagine this plan was executed and turned out to be successful. And let's imagine the studio generates some very big hits.
- Now, imagine that, even though the movies only costs 99 cents to stream, people pirate them anyway (the same way people pirate 99 cent iPhone apps, but, unlike pirated apps, anyone can watch the pirated movies -- not just people with jailbroken devices).
- Suddenly you'll have millions of people using torrents to get bootleg copies of your movies... enough people to where you can't get investors and others their needed financial returns unless you try to put a stop to it.
My question: How do you put a stop to it without becoming Hollywood allover again?
That, to me, is the big issue here. So either you come-up with a theft-proof way of distributing movies or you try to stop it. Or shut down your business.
And adding interactivity to them is not the answer IMHO. I need my passive entertainment and so does everyone else who chooses watching a movie or tv show over playing a game at any point during a day.
Even computer software was distributed through a publisher at the beginning (for example VisiCalc), but it just doesn't work.
Game developers for example seem to slowly get that they don't need a publisher but a distribution platform. Steam is a good start in that direction (but I think still too selective). If there was a platform that would handle distribution, payment and awareness, we could get a lot more movies that won't be big hits, but instead cater to the minorities. Because this is where we are heading. The music industry a really feeling that hard. There probably won't be any "Beatles" or "Rolling Stones" anymore, because distributing and spreading the word about some niche music in that niche circle is getting easier and easier.
And I think this will, in the end, be what will kill Hollywood, because there won't be a movie anymore that grosses multiple million dollars.
"Based on the experience of creating the Star Wreck phenomenon, Star Wreck Studios has developed a Web platform that is designed to harness the power of passionate Internet communities for creating short films, documentaries, music videos, Internet flicks, full length features, mobile films and more. www.wreckamovie.com is a social community, simple workflow and marketplace that builds communities around film productions. It helps get films done faster and at a considerably lower cost through crowd-sourced work on production tasks and online resourcing of expertise and corporate funding. The communities developed in production will also create a viral social marketing force that will get films seen through the hundreds of existing online and standard channels."
I've also come up with a pretty compelling way for Hollywood (the TV business in particular) to embrace the new opportunities of fragmented communities and distribution. It's called micro-cable, and it's something that I think bridges the strengths of both the new digital world and the established Hollywood infrastructure.
Either you stop consuming what they put out, or you find a way to get it without paying. That's what will "kill Hollywood".
Simply taking a Hollywood movie and trying to finance it with $0.99 per view will be just a Hollywood movie financed with much less money. Of course I'll have no hard data, but my hunch would be that this is far from viable.
The problem is deeper than that. The truth is that the Hollywood model carries with it many years of overhead that could be avoided today. Instead of doing slight changes we should be reviewing the the whole production pipeline and get rid of unnecessary dumb pipes. Technology can improve or even remove some of the steps. We need to make content creation cheaper, make it accessible to more creators.
Look at the startups at youtube.com/create such as xtranormal or GoAnimate. "If you can type you can create an animation". Just like wordpress brought journalism and written publishing to the masses. Technology can make the same for other mediums of communication.
* If we build easier and cheaper tools, that anyone can use. Then we can turn more people into content creators, which reduces costs.
* If we get rid of the whole silly copyright fundamentalism, then we can share content pieces between different productions. So creators don't need to reinvent the wheel each time.
Short version: instead of trying to come up with innovative revenue models to support over-expensive outdated production models. Let's keep building better tools that keep cutting costs down to the point that sane revenue models can support. I believe that in the future. Millionaire budget production content won't exist anymore, but it will be better than current ones, because we'll be using better tools. So stop trying to bandage what's broken, we're supposed to be killing that by building something better :)
$5 strikes me as a more reasonable price, as demonstrated by Louis C.K.'s successful experiment.
They will die if you just make better games and story telling systems.
Heck if someone just took dwarf fortress and got it to a stage where peoples fortress histories were converted into fantasy novels, you would have an endless fantasy novel generator/plot system, which would be worth the time to read.
Beat hollywood by competing on time. I don't know what the correct term is, but thats the leading edge/the place where the real battle is being won.
Whatever starts taking over the spare time people have, will displace all the other entertainment media out there.
I'd vote on video games, as one of the better attack vectors to approach this. And not the Micro transaction system (which is basically a casino/skinner box and now completely evil) but rather a system like EC2 which allows people to punch beyond their striking capacity.
Thing is, this has been done, and the results probably aren't what you want to hear. Hollywood actually produces fewer family and broad-appeal genre films than the market can handle. (Check out this book: http://www.amazon.com/Hollywood-Economics-Uncertainty-Routle... )
The reason for this mismatch between what the market can handle vs. what actually gets made is that Hollywood insiders actually do want to make dramas aimed at adults, which have a much smaller market than, say, animated kids' movies.
If you count what you watch, or more likely an average US TV viewer watches, per day, that could be ten or fifteen half hour or hour shows. Over the course of a month that's considerably far more than what they are currently paying for cable.
A more viable plan might be for the return of 'soap operas' with advertisers specifically sponsoring TV shows.
* I know soap operas aren't totally dead, but their original funding model is.
How about doing movies with a Richard Linklater's "Slacker" like script? In the movie, characters are followed for a few minutes and then someone in the last scene of that segment will continue that movie interacting with a completely separate set of people and so on and so forth. Rent it on Netflix to see what I mean. This kind of movie could be crowdsourced. Someone writes the script. Many want to be actors shoot segments. The winning entrants film short scenes where they call each other on the phone to move the movie along. It's like Redditt the movie. Would somebody please do this idea? Please :).
My impression is that film-makers depend on Hollywood not only for the distribution but also for the funding to make the movie. If indie movies go to Hollywood not for the funding (because they're already good at making quality movies for cheap) but for distribution, then I think we have an opportunity.
We should offer an online way to distribute these indie movies.
Say I built a website that offered to host indie movies online for pay-per-view.
The distribution system would be transparent. Say you've made an indie movie. You let me host it online and charge viewers to watch it, and I give you 80% of the revenue (or whatever is necessary for me to cover costs and make a small profit)
I'd probably screen movies for quality and hand-pick the movies I allow for viewing on my site (like literary magazines or existing film festivals). It doesn't matter if I have relatively few movies on my site if they're all good (and I keep releasing more of them). The site will market itself: people will constantly check back for good movies and tell their friends about this site.
This won't stop Hollywood from churning out blockbusters, but we can keep indie movies from falling into their hands. One problem is bootstrapping the site but we might be able to convince good indie film-makers who don't want to be part of Hollywood to allow us to distribute their movies (and thus establish the site).
It turns out a website like this already exists (possibly others): http://www.indiemoviesonline.com/
There are several problems with their site which I think can be improved. They don't provide enough "buzz" for their movies. No trailers. No big pretty posters. It looks kinda like Youtube. They also give out the movies for free.
Summary: I think with proper execution it's possible to create an online pay-per-view indie-movie website without too much effort (except you need to contact filmmakers). Such a site would provide an alternative to Hollywood for certain niches.
At 99c a pop, you would need _billions_ of views to compete with the income of a blockbuster [not to mention innovative] film like Avatar, which according to Wikipedia made nearly $2.8 billion. If you look at the most popular YouTube videos, you'll find things like Justin Bieber's songs with about 700 million views. Making the generous estimate that about a tenth of those viewers would pay for that content, you would make about $70 million, which is orders of magnitude less than what they do now.
A better comparison point would be YouTube's HD video list, which perhaps more closely approximates the production values an independent filmmaker might aspire to. The top HD videos on YouTube mostly have <10 million views. And they're short, and free.
Remember when people thought it was impossible to put a computer in every household?
In the late 90s, television became a good place for creative people to work, because the industry gave writers freedom to break moulds that had contained them before. e.g. Buffy finished high school and went on to a next stage of life.
I'd focus on finding a way to deploy compelling stories so that they could be consumed for portables, browsers or airline screens on long-haul flights.
I think it fits well with the "0.99c/view" model proposed here.
Also, don't forget to ban region locking: if you want to change or beat Hollywood, have the movie available as soon as possible to conveniently purchase and play from every country when you want on any platform from. Then you're really changing the game and are a viable alternative to torrents.
Otherwise I really hope someone can do this. You could possibly set the price point higher though?
I'm not even sure that heavy advertising would be needed for the individual films, so long as you managed to attract a user base who expected high quality films they wanted to watch on the home page.
Hollywood started off as studios where actors are essentially employees. They own vertically integrated enterprises which included distributorship as well as cinemas. (Read up on the Studio System).
This started to break down as studios gave certain actors a "star" billing and some actors become independently recognizable and started working as free agents. The trend persisted with now entire teams are assembled virtually on a project by project basis.
On the distribution side of things, secondary markets became increasingly vital. Cable, DVD rental, PPV, DVD sales and international distribution have overtaken box office takings.
The free-wheeling internet has proven to be a problem because some people who are watching movies at home are no longer accessing these through the monetizable channels like rentals, but instead are doing this through the free/unauthorized channels. I don't really know the size of this problem, as I personally don't like the idea of being shaken down by the MPAA or RIAA. Besides, I don't have the time.
Therefore to solve this problem for Hollywood, one working theory is that people don't mind paying a certain amount for the convenience of watching movies where they want it, as long as the price is "reasonable". This is Apple's model.
However, in general, the current way of negotiating individual distributor agreements represent a high degree of friction, and that locks out potentially creative ways for studios to earn back their investment.
If movie makers were to securitize its prices, alternate channels will flourish. I envision it more or less like a mechanical license.
One formulae may be based on days since first released and the size of the screen, and whether it is PPV or multiple viewing.
Then it is up to repackagers like DVD-makers, movie theatres, and online channels to reach the viewers. Repackaging may involve adding ads before and after the movie (brings down the cost of viewing), or even during the movie (as in TV).
If such a pricing evolves, I can see devices such as Roku offer a "legal" way to view a movie even if the user has downloaded it from a torrent. For instance, a user may be prompted whether they wish to deduct the price of the movie from their account in exchange for indemnity if they were prosecuted for illegal downloading.
In the big picture of things though, movies are a huge time drain on society. I, for one, would rather see people having to pay to watch movies. My relatives in Asia who regularly buy pirated DVDs from street stalls watch way too much movies and fritter their lives away.