Content Insider #815 – Borderless
By Andy Marken – andy@markencom.com
“Cross me and I’ll kill ya. I’ll shoot you where you stand, and I’ll bury you where you fall.” – Molly Johnson, “The Drover’s Wife: The Legend of Molly Johnson,” Bunya Productions, 2021
We’ve always known that Hollywood didn’t have the corner on the movie/series development/production market, but seeing them was always a challenge. We had to visit an art movie house or hunt through the 900+ channels on our pay TV bundle until we cut the cord.
Sure, the Academy said they considered English and foreign-language films, but seeing them actually receive an Oscar was … rare.
Back in 2018, Roma was like a pleasant surprise while Parasite sweeping honors was something of an awakening that award judges finally woke up to the fact that a good video story was good no matter where it was written, shot, produced and posted.
In other words, creative work doesn’t have borders.
It’s more than having creative control here, shooting, showing around the globe and adding to a US studio’s bottom-line.
Yes, we’ll say it, we really believe that movies/series have the power to reach, influence, persuade and impact people around the globe.
Don’t get us wrong, we still like home grown stuff.
Take Davis Guggenheim’s Still: a Michael J. Fox Film that Apple TV unveiled at Sundance earlier this year. We had a chance to see it because our daughter has a close bond with Apple products (Mac, iPhone, yes-AppleTV+).
Sure, the documentary is interesting because we grew up with him from his early days in Family Ties through three Back to the Futures and even the two times, he appeared in The Good Fight TV series.
But his message regarding the inevitability of Parkinson’s Disease and the class/determination he has as he faces the inevitable one day at a time resonates with everyone on the planet.
It’s more than a feel bad/feel good story, it’s a study of how a good filmmaker can turn a story into a great film.
There are great filmmakers around the globe and regardless of the genre (adventure, comedy, action, sci-fi, horror, romcom), people want to see their films in a theater or at home on the couch.
Today’s motion picture industry is in an awkward transition.
Studios want to be leaders in the theatrical arena and the direct-to-consumer arena while trimming everywhere for Wall Street/stockholders.
The US film/show industry (often simply referred to as Hollywood) is the largest in the world – worth about $95.5B last year, employs slightly more than 45,000 production folks.
Global Centers – It’s become apparent that great film/show creation isn’t confined to one region or one country. Thanks in no small part to the increased demand for great video content, major facilities have cropped up around the globe.
But film/show production is a global industry with the Americas being the largest followed by the UK, China, Japan, France and India.
Combined, the film/TV industry supports an estimated 2.4M jobs, according to the MPA (Motion Picture Association).
Content Delivered – While the US may be the home to the most movies/shows produced (and consumed), other countries have increased their share of audience-winning projects.
Last year, the industry spent about $134.6B to produce content for people and estimates are that this year the content investment will probably decline in a large part due to the various strikes/work stoppages in the US.
Theater, TV channel and streamer folks put on a great smile telling the content consumer that everything is great because they have all of the stuff, they need to keep you in your seat staring at the screen.
It’s true that the global box office bounced back last year reaching $29B which made the 200,000 theater owners ecstatic, even bullish. Never mind that the increasingly expensive ticket sales were 30 percent below the numbers they raked in during the 2017-2019 period.
The 2007 Hollywood hiatus changed the industry’s focus/direction. The 2019/2020 shutdown helped people understand that there’s a lot of different content out there that’s really good, just…different.
While theaters will survive yet another hit, but they are the zeitgeists of a period that has passed relegated to the period when superheroes, super directors, superstars reigned when people regularly put their seats in seats to enjoy a pleasant break from the world around them.
However, broadcast is history.
Cable/pay TV has lost large portions of its audience in developed countries and as emerging countries’ services move from cheap audience capture to profit improvement their numbers will similarly shrink and stabilize.
Even WBD’s Zaslav is beginning to doubt his mandate of theatrical window first as his recently announced Max service begins the fight for more subscribers in the Americas and beyond.
Viewer Demand – Movie theater attendance has increased but few think it will ever return to the industry’s “glory days” with video-on-demand filling the consumer’s entertainment void.
Today, ninety-three percent of folks in the Americas rely on streaming services for entertainment.
According to Statista, the global value is projected to reach $39.25B this year, growing to more than $55.5B by 2027. In addition, the firm estimates there will be more than 3.5B streaming users or nearly half of the worldwide population.
Content creators/producers can probably thank/blame Netflix for starting the anytime/anywhere/any screen industry disruption.
Technically they weren’t the first streaming video service – that honor belongs to Hong Kong’s iTV back in the late ‘90s – but it was the first successful service becoming a $100B company in just 20 years.
On any given day, any given week it trades credit for the largest number of subscribers with Amazon Prime with viewers in 192 and 191 countries respectively.
The UK’s MUBI ties with Amazon’s reach specializing in film production and distribution followed by YouTube (112), iTunes/Apple TV (102 and Disney+ 58.
Global Reach – While Netflix is available in far more countries than other streaming services, it doesn’t own the lion’s share of audiences in all of the countries.
Rounding out the global penetration services are France’s Canal+ (17 countries) and Arabic Shahid (16 of the 22 members of the Arab League).
In addition to a growing streaming video market, the Arab world also saw theater attendance more than double over the past few years, placing it as a rapidly expanding video entertainment market.
China’s theatrical and video streaming primarily remain exclusionary, tightly controlled by the government with box office receipts expected to reach 15B yuan ($2.2B US) and SVOD approaching nearly $19.5B this year.
Most of the movies/shows are produced in-country under strict contract creation policies. The remainder are from US and international studios that are accepted only after meeting censors’ requirements.
However, the country’s leading streaming video services (iQIU, TenCent, Youku) have experienced subscription growth throughout SEA with total users totaling nearly .5B this next year.
Having reached nearly total penetration in the Americas, streaming services realized they could carry out an endless (and expensive) struggle for growth by “borrowing” subscribers from another service only to see the process reversed later. They could also reach subscribers in other countries who were ready to shed their “old-fashioned” broadcast/pay TV services for new, fresh, unique content.
Expansion into Europe came at what initially appeared to be a penalty, 30-40 percent of the content shown in the country which had to be locally produced and the services had to further invest in additional content creation activities.
Historically, US content dominated the world stage but increasingly, streamer management is beginning to understand what content creators/producers have long advocated … a well-developed, well- executed video story doesn’t recognize borders.
Streams – People everywhere enjoy streaming to whatever screen is close at hand but still the preferred screen is a large one in the home.
Today, nearly 30 percent of the world’s 100 most popular titles were made outside the US, often with a far smaller budget.
In addition, advanced translation and facial manipulation (which we’ll be looking at soon) have made titles “feel” remarkably home grown because most folks don’t want to dissect their movies/shows. According to Hub Research, they simply want content that:
That is exactly what today’s movies/shows do. Or as an anthropologist once observed, “Video storytelling is nothing but data with a soul.”
The increased availability of internationally produced content that folks everywhere enjoy has given streamers the breathing room they need with the US industry shut down because of guild/union negotiations.
In addition, the more we realize the world’s population is the same, the more content creators/distributors understand the differences/preferences.
It Depends – While folks in every country like their share of action, drama, documentaries, westerns, sci-fi and other types of films/shows; it turns out that certain genre are more popular in each country.
The streamers track viewer trends to determine which movies/series click with a decent majority of subscribers as well as which genres have the best chance of attracting even more subscribers.
We may click from our go-to service if it seems like there is heavy dose of horror, romcom or fantasy movies/shows and settle in with number two or three when they highlight action/adventure, drama or sci-fi.
If it happens often enough, long enough, we’ll drop the service for “something better.”
We were brainwashed in the old days that 20 minutes of ads in exchange for 40 minutes was a reasonable price to pay for our entertainment, on top of our expensive 900 +/- channels they were offering us all tied up in a neat little bundle.
The con worked, until it didn’t.
Even the titans of streaming – Netflix, Disney+, Max/WBD – have found that a less expensive service offering a few ads makes sense as folks look at reducing their entertainment budgets, even if the shift costs you something.
Often you shift from watching shows in 4K to catching them in 1080p or worse yet 720p. Don’t they think you’ll see the difference?
In addition, if a movie or series is gathering a lot of eyeballs it may not be available to you until … later.
Preferred – Industry experts continually like to stress that people hate ads and like their entertainment uninterrupted until someone says you can have your content free or at a substantially lower cost if we can include ads. Suddenly, they’re all in!
Rather than being “penalized” for choosing the service’s less expensive option, folks are saying they’re perfectly happy with the rapidly expanding free streaming services — Pluto, Tubi, FreeVee and others.
The services have a large – at times overwhelming – slate of viewing options, including local channels and news.
It’s true, the volume of channel surfing can feel like your old TV practices but they’re working on improving their prioritization and search/recommendation interfaces to personalize offerings based on what you watched earlier or topics/genre you seem to be interested in.
Variety and depth/breadth of movies/shows are important and the great thing about the FAST services is they’re semi-free.
The FAST services presently allocate 10-15 minutes per hour to ads with 3-6 ads per break but with more personalization rather than the same ads for everyone.
Focused, Personalized – The ability to get even closer to the person(s) who are interested in a product/service as opposed to wasting your ads on the vast majority of people who aren’t interested is increasingly appealing to advertisers and streaming services.
Initially, FAST services were based on regional selection – US, Canada, EMEA, APAC, etc. and genre preferences.
However, as the services and advertisers gain an increased understanding of your viewing preferences, the ads will become increasingly personalized, making them more “friendly” and actually interesting to watch.
Flicking through two of the FAST services we regularly use reminded us of going through Blockbuster in the old days, looking for something new, unique and really different.
It made us think the FAST services are missing a helluva opportunity.
There’s a lot of nostalgic content to choose from but what would be really neat would be an indie section.
Indie Opening – Thanks to the availability of economic, high-quality cameras, rental gear and low-cost/high-performance post tools, indie filmmakers are able to complete their video stories with the assistance of friends and experienced crew on a mini budget. FAST channels could also expand their horizons and curate a shared income for the teams.
Every year, there are established filmmakers who want the freedom of making their own film without investors critiquing their work.
In addition, there are thousands of small teams who get together and produce a project they want people to see because they’ve simply got a burning desire.
It would be great if the services established a special “section” in their library for these films/shows that had been peer reviewed/approved for people to watch with the service sharing the ad income with the indie.
Think about it.
There are hundreds, even thousands, of filmmakers around the globe who make “their” sci-fi, drama, documentary, comedy, kid’s show and could get tangible proof of how well people like, respect, enjoy their work.
It isn’t the same as seeing the project on the dazzling theater screen with 100 or so strangers, it’s even more personal because for an hour or so the filmmaker has a direct connection with his/her audience and that’s even more important.
It’s rather like what Yadaka said in The Drover’s Wife, “It’s not what you wear on your feet Danny, it’s how you carry yourself that makes a decent man.”
It could be the strongest and most intimate service that the ad-supported service could provide to filmmakers …and consumers.
Andy Marken – andy@markencom.com – is an author of more than 800 articles on management, marketing, communications, industry trends in media & entertainment, consumer electronics, software, and applications. An internationally recognized marketing/communications consultant with a broad range of technical and industry expertise especially in storage, storage management and film/video production fields; he has an extended range of relationships with business, industry trade press, online media, and industry analysts/consultants.
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