21 Mich. St. Int’l L. Rev. (2013)
The full article is available for download at the Social Science Resource Network at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2247134
Download: Digital Hollywood 2.0
The seven largest U.S. motion picture distributors control as much as ninety percent of the U.S. domestic box office and the majority of the global theatrical box office revenues. This economic dominance in gross revenue, however, undervalues the success of financially and artistically successful works budgeted for smaller audiences. Similar economics also drive music and publishing economies.
Measured solely from gross revenue, the Hollywood model of distribution dominates most markets around the world. Lower budgeted projects, however, may have much higher returns on capital investment and allow the creative artists to engage more targeted audiences. When more appropriate measures of success are utilized, a different picture emerges. European productions represent a significant amount of content and although Hollywood continues to achieve a disproportionate amount of gross revenue, the European productions continue to achieve profitability and audience acclaim.
The same is true elsewhere. India, for example, “has a thriving film industry, both Bollywood films, the Hindi blockbusters coming out of Mumbai film studios, and regional films made in regional languages dominate the Indian box office leaving less room for Hollywood films.” South Korea, Nigeria, Hong Kong and increasingly China all have strong attendance of regionally produced films despite the competition with U.S. product.
This article will analyze the legal strategies and business models utilized by the new film distribution companies and contrast these with the models working for Bollywood, online music distribution at Apple, and e-book strategies at Amazon and Google. These strategies include social networking and community development at the inception, production and distribution stages of the content. Distribution 2.0 begins with crowd-funding and related strategies to engage the audience before and during production to build interest prior to distribution. It analyzes current financial structures to assure a healthier economic relationship between participants, producers, and distributors in order to create a sustainable business model. It then looks at the distribution strategies to emphasize the ability to use social networking and communities of interest to build and sustain audiences and rethink pricing strategy.
This article will address the financial regulations, intellectual property laws and contracting strategies that interfere with existing models and articulate the potential best practices for the next generation of narrative and documentary films. The model also creates a platform for shorts, episodic content (e.g., series television) and music.
Number of pages in PDF File: 34
Keywords: film, motion pictures, videos, music, social media, intermediaries, distribution, disruptive innovation
JEL Classification: L82, K2, K22, k39, L22, M13, O33, O34, Z1
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* Jon Garon is admitted in New Hampshire, California and Minnesota.
Jon Garon is the director of NKU Chase Law & Informatics Institute and professor of law