MovieMaker’s 2017 Guide to DIY Digital Distribution: Our Fifth Annual VOD Overview

While it’s still churning, the digital distribution dust has settled just enough to bring good and bad news to indie moviemakers. Often these are two sides of the same coin. Let’s examine how going your own way may well be your best bet with Video on Demand distribution.

Take what producer Ross Putman has to say about his experience getting writer-director Kerem Sanga’s teen romance First Girl I Loved into the world since its Sundance 2016 premiere. “In 2016, there are many different ways to be a success,” he says, “but [succeeding] involves a pretty complex understanding of rights and deals.”

Don’t worry too much yet. MovieMaker’s fifth annual Guide to DIY Digital Distribution is here to remind you that where there’s a will, there’s a way to DIY.

Start by narrowing your priorities. Think really hard about this question: Why are you making your film? Recouping investments may not be possible. You may have to recalibrate your idea of success (and educate your friends and family on what the concept means in the digital age). You may have to sacrifice the emotional satisfaction of a theatrical presence, or shell out the bucks to make it happen.

Even though Putman helped guide First Girl from top-tier fest to its October 18 DIY Video on Demand release and subscription Video on Demand (SVOD) deal, with a smattering of fests and a theatrical run, he admits, “I didn’t know half of this stuff before I started.” He says a lot of the work of distribution is about having time, not money. “It comes down to giving your movie to somebody else to do the work, or choosing to do it yourself.”

Hybrid distribution (divvying rights among yourself and various distributors) has opened up an endless combination of ways to connect with audiences and secure revenue. It’s also opened up endless ways to keep working on the same film. Maybe that’s why Sundance Institute’s Artist Services manager Liz Manashil says it’s still incredibly common for moviemakers to be wooed by all-rights deals. “The majority of independent filmmakers are still unaware of their power to say ‘no’ to distribution deals that are restrictive,” she says. That’s because all too often, “Their first choice is to get taken care of.”

Manashil wrote and directed the 2014 anti-romantic comedy Bread and Butter, now on demand through The Orchard. After a respectable festival run, she weighed the rigors of a DIY theatrical run, and opted to channel her resources into the film’s digital livelihood—and, more than a year after its digital release, she unexpectedly received two SVOD offers. (Icing on the bread, so to speak.) She advises moviemakers to “start to realize what the actual potential is for their films.”

Of course, assessing that is easier said than done. In the midst of a lot of lightning-rod talk about transparency but a persistent lack of published numbers, distributor The Orchard made headlines for posting revenues for the 2015 documentary Cartel Land, with more films forthcoming. The Academy-nominated documentary’s internet VOD rights, the information showed, were by far the most valuable, at $568,790 projected ultimate. That’s more than its two licensing deals combined ($210,000 each).

Likewise, Matt Grady of Factory 25 Films gave a breakdown of Christmas, Again on the Sundance Institute’s artist services blog, where there are other distribution case studies. With a U.S. premiere at Sundance 2015, Christmas, Again incurred $24,455 in distribution expenses with about $20,000 reported back when Grady published in April 2016. About half of that presumably came from SVOD deals with Fandor and Netflix, with about $6,000 and about $4,000 coming from other VOD platforms and theatrical, respectively.

Putman, who consulted with Manashil and artist services director Chris Horton, parsed out the value of First Girl I Loved by analyzing its all-rights offers and subtracting the presumed distributor’s cut. He also became well-versed in possible revenue streams (or rights)—he says First Girl is currently exploiting seven rights (theatrical, non-theatrical/festival, TVOD, SVOD, package/DVD and foreign, which are determined by territory). By using the aggregator Quiver Digital, a Sundance partner, to handle transactional (TVOD) rights, Putman’s team is handling all but SVOD rights in house.

Putman explains, “The cheapest and easiest way is to work with an aggregator, but our license term is not with the aggregator. We pay a flat fee up front and capture all revenue. [Quiver] is more like a vendor. They have no stake in what’s good or bad. They provide a service that we paid them for.” Some platforms, like iTunes, accept films from aggregators outright. Other platforms like Comcast Xfinity have to be pitched, which Quiver will do for an additional per platform fee with no guarantee of acceptance.

What if your film has no offers, or you’re being solicited for money? Putman reasons that you can deduce that your film is valued at zero in the market place. “That doesn’t mean your film has zero value. It means that distributors do not think they can make money off your film. Then you should ask a separate question: ‘Who is my audience?’”

Audience is the most important factor when distributing your film, according to Naomi McDougall Jones. She says she was obsessive about sending out production updates on the 2014 feature Imagine I’m Beautiful (which she wrote and starred in) and, as a result, watched her email list, and its open rate, grow and grow. That fact helped her film get a distribution deal with Candy Factory. Letting your audience into your process is “the one card you have to offer them that Hollywood doesn’t have,” she says.

Indeed, Quiver’s managing director, Shiron Bell, says that the current state of film distribution “dictates that you live your life publicly.” He advises making a production about your production. “Take on set photos and videos. Give a sense of the story without giving it away.” The best delivery system is social media. “Filmmakers who are smart, either through paid or natural and organic social, are the ones who succeed,” he says.

Almost all of First Girl’s audience engagement lives on Facebook, to the extent that it’s not immediately clear if the film has an “official” website. (It does.) But there’s no benefit to routing people away from a chance to comment, share or buy the film. Putman created a Facebook ad that links directly to the movie on demand. “I just want the most direct route from interest to purchase,” he says.

Several people interviewed advise devoting a lot of energy to TVOD pre-sales. On iTunes especially, exceeding 100 pre-sales can boost a film’s ranking, which cyclically attracts more sales and helps keep the film ranked.

Writer-director Liz Manashil (foreground, center) and team on the set of feature Bread and Butter Credit: Photograph by Amy Taylor

Writer-director Liz Manashil (foreground, center) and team on the set of feature Bread and Butter. Credit: Photograph by Amy Taylor

Bruch Nash, industry analyst and founder of website The Numbers, seconds the need to make your film visible, especially within the many still-cumbersome VOD interfaces (e.g. searching through an alpha grid with a TV remote). For that reason, he suggests considering lesser-known platforms with fewer titles. More than that, he emphasizes, “You have to have a strategy for getting into subscription streams. Without it, you’re fighting for crumbs.”

Nash has been collecting and analyzing box office data since the 1990s. Since 2010, he says, “SVOD has grown from nothing to $5 billion and electronic sell-through (EST) has grown from $500 million to $2 billion.” But because overall home video spending has remained flat (at about $18 billion per year) and the presumed majority is devoted to TV, the picture for indie moviemakers can look pretty bleak.

As someone who craves the immediate response of an audience, writer-director Li Lu (There Is A New World Somewhere) tries not to be discouraged by the digital landscape. “As individuals, we are like, ‘This is fucked.’ We all feel the need for evolution. We obviously know the systems are flawed.”

“The landscape can change in a second (or an email),” Manashil says. For her that means something very big: “Little films have a chance.”

McDougall Jones acknowledges a need for systemic change and is taking action. She’s behind a soon-to-be-announced company that will finance female directors’ second features, devised after a recent analysis of distribution data from about 20 microbudget features shocked and depressed her.

This is her positive takeaway, though: “If you do self-distribution, there’s no question you would make more money that way.” With that, we’ll take you through some of your options.

Transactional VOD Platforms (TVOD)

When people use the phrase “now available On Demand,” they tend to mean TVOD sites like iTunes, Amazon or Google Play, or cable providers like Comcast Xfinity, Dish, etc. These are the high-traffic, device-friendly destination platforms where viewers go to rent or buy single films. TVOD encompasses both VOD for rental revenue and EST for sales revenue. There is sometimes a distinction made between cable (cVOD) and Internet (iVOD). TVOD revenue is typically paid out through splits per rental or sale; terms vary by platform.

What was true last year is even truer this year: TVOD platforms are practically interchangeable, at least from an indie moviemaker’s point of view. You want to be on as many as possible because there’s little reason not to be. TVOD platforms are often the first stop or a simultaneous stop in a digital release. Pushing TVOD pre-sales can significantly increase a film’s visibility. One moviemaker told us to expect a majority of TVOD revenue to come in the first 60 days, which is why SVOD often kicks in a few months later. (Of course, these are general guidelines and since every film is unique and field is constantly changing, adapt them accordingly to your situation.)

All of the listed TVOD platforms except Vimeo On Demand and IndieReign require an aggregator, distributor, proprietary encoding or, failing that, some kind of magical celebrity dust to get in the door. In some instances, your gatekeeper has to jump another curatorial gate and can offer your film no guarantees. So we’ve distinguished the open platforms from the curated platforms. A handful of aggregators have “preferred” status, which can help with acceptance rates or improve film placement on a platform.

Open TVOD Platforms

Amazon Instant Video, Google Play, IndieReign, iTunes, Steam, Vimeo On Demand, Vudu

Curated TVOD Platforms

Comcast Xfinity, DirecTV, Dish, FandangoNOW, Hoopla, iN DEMAND, Microsoft Movies & TV (includes Xbox), PlayStation (Sony Entertainment Network), Vubiquity

Subscription VOD Platforms (SVOD)

Formerly known around these parts as “destination platforms,” SVOD platforms are the current It Girl of digital distribution. Netflix has built such an appealing model that, well, everyone wants in. For moviemakers, that means there are actually SVOD deals to be had, including production funds. We’ll list a few SVODs for reference. (However, because this is the growth area of home entertainment, another could pop up any minute.) Films typically license to SVOD platforms for two or three years; deals can range from $2,000 to $10,000 for low-budget pictures and skyrocket depending on many other factors. SVODs are curated—that’s really the point—though it’s possible to approach some, such as Fandor, directly, without an aggregator.

Netflix

No one human claims a complete grasp on the opaque Netflix film selection process. What we do know is that the platform’s interest in TV outnumbers movies 2:1—at least, based on its original programming slate for 2016. One aggregator we spoke with said the films Netflix takes or rejects can vary dramatically one month to the next.

Hulu

While Hulu hasn’t eliminated ads entirely, the company announced in August that it would phase out its free ad-supported option, leaving two subscription options in its place ($5.99/month with some ads; $11.99/month without ads). The platform is branded more for TV than movies—it’s busy securing SVOD rights to heavy-hitting TV series, funding original productions and opening a new branch devoted to documentary. The path in for indie moviemakers’ access isn’t abundantly clear. We recommend an aggregator or advocate.

Fandor

It’s a subscription service for the art-house aficionado with titles that reach back into cinema’s rich history and beyond U.S. borders. Fandor has been around since 2011, which is long enough to establish brand familiarity in a sea of start-ups. It’s expanding its partnerships with basic cable.

Others:

Amazon Prime, BET Play, CBS All Access, FullScreen (youth-centric), HBO GO, MUBI, NoBudge, Seeso (NBC’s comedy SVOD), Showtime, Tribeca Shortlist, Verizon Go90, Vessel (specializing in early release), YouTube Red

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