Thursday, August 06, 2009

Another Few Steps Toward Monetization

Variety reports that WB is signing deals for VOD.

(Emphasis mine)

Warner Bros. is positioning itself to be a major digital distributor of independent movies through cable video-on-demand services worldwide.

The studio has signed a handful of deals with indie companies including Gravitas Ventures and Image Entertainment to put out feature films and documentaries on cable, satellite and telco VOD systems across the U.S. and in other territories where Warner distributes digital movies.

Warner Bros. additionally said it has deals with Oscilloscope Laboratories, Wolfe Video, First Look Studios, Full Moon Entertainment, Marvista Entertainment and Lantern Lane Entertainment and is continuing to sign more.

The move provides independent film companies access to new parts of the VOD business with Warner's promotional muscle and also broadens the range of content available through cable VOD.

"This is a way just to grow the business," said Thomas Gewecke, president of Warner Bros. Digital Distribution.

Gewecke said the studio, already a leading distributor of digital content with the Warner library, was motivated by a growing demand for VOD content.

Video-on-demand and digital sales for the first half of the year came in at $968 million, according to nonprofit trade consortium DEG: The Digital Entertainment Group. That is still relatively small compared with the $5 billion in sales logged by DVD and Blu-ray in the same period, but VOD and digital sales are growing. Gewecke said the digital and VOD companies through which Warner distributes its films are eager to offer viewers more content, which in turn could lure in even more viewers.

Warner will handle everything from encoding and digitizing films to promoting and marketing them to consumers as well as tracking sales -- all services many smaller companies don't have the infrastructure to handle. Gewecke said the studio will leverage its own infrastructure to get smaller films more exposure.

While Warner is signing a broad range of distribution deals, the studio is being choosy about which films it agrees to distribute. Gewecke said it's all dependent on what the studio thinks will rent and sell well.

Some of the independents for which the studio acts as a distributor are also choosing to release films simultaneously on VOD and DVD, following Warner's lead.

Warner has been the most aggressive studio in putting films out on VOD, tightening the standard 30-day window between a pic's DVD release and its VOD debut for most of its films in an effort to boost digital revenues. Warner has said tests with Comcast and Time Warner Cable have shown that simultaneous releases boost VOD sales without cutting into DVD sales. It does have a slightly negative impact on DVD rentals, but the studio makes better margins on VOD rentals.


Of course, Mark Cuban has a few things to say - all of it is must reading for distributor types looking to start a distribution concern using VOD. "Guaranteed" a good business read.

Then we have this to add to the mix.

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