Lessons On The Bubble

I thought I read that Bubble took in 5 million or so the first weekend. Mostly from HD Net viewings. If that’s true it seems like a reasonably profitable model for smaller films that can’t be sent to as many theatres due to the distribution costs.

Craig: Long time, first time. While it did only take 70,000 in theatrical revenue, I believe BUBBLE had 500 thousand buys from HDNET and DVD orders around 5 million. Pretty decent for a movie with a 1.6 million dollar budget. Of course all the press for this movie, even the reviews it garnered, focused exclusively on the release pattern and just barely touched on the movie itself (which is pretty damn interesting by the way). I don’t belive anyone expected this little experimental movie to be the death of how movies are released. It’s a first step, a tiny step, but a step in a direction that is going to be more and more common. Will big movies like SUPERMAN RETURNS every do something like this? Probably not in the near future, but for a smaller movie this is perfect. I live is Des Moines where a movie like this might never play (although believe it or not Des Moines is actually a good movie town). I was glad I had to option of buying the movie instead of waiting six months to a year to see the damn thing. Again, nothing really revolutionary happened. It was a baby step, but like it or not its a step towards the future.

“Similarly, no one watches HD Net.”

No one watches HD Net YET. We are in a strange place now where we are starting to track the numbers for Blu-ray and PSP discs. The same thing for HD Net - it’s an infant, and infants tend to grow fast if they’re well fed. Soderbergh and Cuban are finding out what they can feed this kid and how fast he’ll grow. My guess is that at some point - they are going to use this release pattern for a mainstream film - maybe a genre piece, but who knows?

And Avi Arad is quoted as making plans to produce a DVD Premiere big budget ($60M) Marvel movie. No theaters at all! The price of the disc will be adjusted accordingly - I think $39.99 was mentioned. The point is that the traditional route of distribution IS changing based on the needs of the particular property. In the Marvel case, it’s a matter of their movies having a long shelf life justifying the expense. If they were a toy company (which they are but beside the point) they don’t charge admission to a toy room so kids can play - they just sell the toys…

It’s a little unfair to say that Bubble was only released day-and-date because no one had faith in it. HDNetFilms planned with Soderbergh to release this and his next five films for them in this manner. They planned this from inception, before the script for Bubble was even completed.

Bubble did fine on DVD, but that’s the point, isn’t it? The theatrical release was entirely unnecessary. Bubble is a straight-to-video movie.

Glassblower, I cede your point to an extent. I suspect, given that Soderbergh cast Bubble with non-actors, that HDNetFilms knows in advance that these movies aren’t going to be as accessible as Soderbergh’s other films. In short, they have no faith that the movies could do well theatrically.

If they did, no day-and-date.

According to I know who has worked closely with Soderbergh and Clooney, they had made the decision to work with this distribution model years ago.

The decision wasn’t at all a question of faith in the film’s theatrical release potential. They plan to do the same with major productions.

Daniel L

I have to agree with Craig.

Multiplexes with tiny screens and crappy sound systems are probably in trouble. I don’t go to see films at multiplexes with tiny screens and crappy sound systems.

But BIG screens are something I’ll never give up.

It’s pretty simple. Any film looks better on a forty foot screen, and I don’t have the room for a forty foot screen in my house.

Sure I’ve got a pretty nice “Surround Sound 5.whateverthehell” sound system at home, but I’ve also got neighbors. They’re not going to put up with my using that sound system to its full potential, and shouldn’t have to, and I’ve got no intention of building a sound proof bunker in the basement.

I like having company when I watch a film. Lots of company. A crowd laughing puts me in the mood to laugh. I laugh harder and more easily. Call me a sheep, blame my bovine instincts, but I like my herd. I just don’t want them in my house.

It doesn’t matter what kinds of new delivery methods technology offers me now or in the future. It doesn’t matter how instantaneous or convenient it is. Unless it comes with a theater I ain’t buyin’.

TV, DVD’s, downloads, they’re all second best. I’ll settle for second best, when I have to, but given the choice I’m always going to want to see a film in a theater first.

Even if the “day and date” release strategy does become the norm, ya know what that’s really gonna change for me?

Nada.

I’ll still see the film in a theater first, and then decide if I want to buy it on DVD or download it.

Craig’s right, it’s hype, much ado about not a lot. Television was going to be the death of theaters. Then it was VHS, then laser disc, DVD, now it’s the internet and downloading, and one of these days it’s going to be direct neural induction through an optical data port in you frigging skull.

There was a time when it was predicted that film would be the death of live theater too. Heeyeah right. Anybody care to guess how much I just plopped down for tickets to see Julia Roberts in THREE DAYS OF RAIN?

H.Y.P.E. - Hysterical Yapping Produces Excitement, but that’s about all it does.

P.S. - Did anybody go to see the WGA seminar on “DOWNLOADING THE FUTURE: HOW TO SURVIVE AND PROSPER IN THE NEW ERA OF DIGITAL PROGRAM DELIVERY”? I heard it was a bit of a bust.

Sorry about the anonymous post. That was me. I recently turned off that “remember who I am” function on my browser. I keep forgetting that now I have to put my name in the name field every time I post.

Check out a recent interview (The Digital Future Part 1) on NPR’s the Business, with Todd Wagner of 29/29 Entertainment, the company behind the release of Bubble.

http://www.kcrw.com/cgi-bin/db/kcrw.pl?showcode=tb&airdate=1/16/06&tmplt_type=Show

When quizzed about whether this business model is for smaller indie pictures or blockbusters, Wagner states that ultimately it’s a model for movies big and small. He goes on to use the music industry as an example of how to give an audience a variety of choices in where, when and how they consume music.

Cynical marketing ploy? As a recent father, who’s finding it increasingly difficult to get out to the movie theater, I can only hope it isn’t.

Try this link instead.

http://www.kcrw.com/show/tb

Let’s not forget the potential for distribution via digital file to forge a new landscape in the theaters as well. The whole shift call fall back in favor of multiplexes. A 10 screen plex that could run forty films in a week, picking niche hours for niche audiences. Not transporting reels, try one time showings. Open up 7 screens for Spiderman 4 for the after school rush. Lunch specials during the week for independents, nightly gore fests for the late teen and college set. Flexibility to do many things in many ways with a price point (after the conversion) and convenience to maximize profit and satisfy customers.

I may watch a lot more movies on DVD, but I still love going to the movies … and drive-ins! :)

I would have gone to see Bubble in the theater, but the theater owners in my town all boycotted the movie, and then used the film’s small theatrical grosses over the weekend to justify not screening it. I’m all for “day and date” release, anything that will make the theater owners re-evaluate their crappy movie houses. (Unfortunately Bubble won’t do that) Most of the time the large screen projection of the cinema barely makes up for the mind-numbing twenty minutes of tv commercials and the junk food-only concession stand. Please, why won’t filmmakers band together to promote theaters that aren’t interested in making a killing off the public through advertising, but that just want to show movies in a quality setting?

I think the basic issue Bubbles (sorry…) down to two distinct points:

1. Day and Date Releases are retarded and they will never be the norm…

2. You would actually save money if the movie just goes straight to DVD.

There was absolutely no reason for Bubble to come out in theatres. With the cost of making 32 prints and the fact that the production studio gets back about 50% a movie’s gross, it was just a bizarre decision.

The fact is, the proper business model has worked and has been in place for years. Either you come out in the theatre or you go straight to DVD. I think we can all accept the fact that they would NEVER do a Day and Date release with a big budget film, this model works only for very small films.

There’s also the thinking that maybe the filmmakers want to be eligible for Award contention and that may be a valid point but it still would produce a pretty lousy DVD. And that’s what annoys me the most.

When I buy a DVD, I buy it not just for the film but also the extra tidbits. I love Special Features and for me, makes the film a bit more enjoyable. But these extra tidbits will only be available after a respectable time period between the release of the theatrical version and the DVD version. I loved the movie, RAY, but I was so disappointed in the DVD. It was totally thrown together with featurettes that originally aired on HBO and the additional footage wasn’t even edited into the film. I don’t really think sales were hurt because the actual DVD was crappy but it would’ve been nice to spend time on that format, rather than just an after thought.

Something tells me that Day and Date will never catch on. And thank God for that.

Most movies are about “big things” that should be seen in all its glory on the big screen and how could you ever give that up? The cinematic experience is where dreams are made.

Who could ever forget the first time they went to the theater to see Indiana Jones for the first time? Star Wars? Jaws? Rocky pummel Drago?

Isn’t this where most of us were thunderstruck and with wide eyes said: I dunno how, but I wanna be a part of this!

Kevin: What do you mean by ‘the proper business model has been in place and has worked for years.’? Back in Hollywood’s Golden Age everything was vertically integrated and studios controlled everything from production, distribution through to exhibition. With divestiture in the late forties that all changed.

This is about consumer choice. Not about the death of cinema. There will always be people who go to the theater - the same way there are people (like me) who rarely go, but would still love to catch the new releases in the comfort of their own home, either through pay per view, DVD or downloads.

From the numbers I’ve seen so far, this has been a very successful outing for a movie of this budget size. They will take this back to the lab make adjustments to the formula and you will see more and more of the Day and Date release. Movie theaters are not going anywhere for sure, the communal aspects of watching a shared entertainment experience are almost part of our DNA at this point. But for those smaller hard to place Films this seems to perfectly fit the bill.

I had to wait almost a month to see Kiss Kiss, Bang Bang in the theater because that’s how long it took to get to my town — and I live in Portland, Oregon, a town that you would think (having two major film directors living here) would garner some respect from the the film establishment. I wanted to see the movie on the day it came out, but was denied that joy because…why? Why should I not be allowed to see a maor release the day it opens? Please, someone tell me why? In this day and age you would think that we’d be able to come up with something— wait, we have, “day and date” release!

Matt—

As far as Hollywood’s Golden Age goes, there hasn’t been a major change in Hollywood for the last 50 years. The death of the Studio System has been replaced by lucrative multi-picture deals and if Harvey Weinstein had his way, the Studio System would truly return.

And Day and Date release truly has very little to do with Hollywood. There’s no way a major studio would release a big budget or even moderate budget film like that. It wouldn’t make any sense from a business stand point.

Kevin: If smaller producers take the lead, that’s precisely what will happen.

Just so I know in advance, would you like custard or cream with your humble pie? :)

No, but it makes sense from a supply and demand point of view. Give us (the consumer) what we want when we want it— and we want it now!

Matt:

Why would a producer with a typical studio film that cost 40 million dollars ever consider going day-and-date for even a second?

Seriously, why?

To reach a larger market. Some people can’t fit into theater seats.

Angry Boy:

I think it kind of stinks that you had to wait a month for Kiss Kiss Bang Bang. But it’s a business model called, Platform Releasing. It’s a very good way to release a smaller movie so it can generate a word of mouth and then gradually release it into more cities.

Matt:

Humble pie? Are you serious?

There is absolutely, positively, no reason for a studio movie to be released this way. And why in the world would a smaller producer do this? I am a “smaller” producer and having a Day and Date Release is a a great way to destroy the possible income of my film.

And for the record, I hate custard.

Craig: Not that long ago, it might have sounded ludicrous to the CEO of a major record company to entertain the idea of music downloads, but it happened. Apple took the lead and gave consumers what they wanted.

You’re right, at the moment there’s no way it will happen. Hollywood is resistant But all it will take is for an Independent to launch a hit using the ‘day and date’ model and Hollywood will quickly reconsider its options.

Then there’s the small matter of piracy. In the long run wouldn’t Hollywood rather capture those customers who are downloading movies illegally through pay-per-view or downloading? Not mention the people who never go to the theater.

Kevin: Hasn’t the relative success of Bubble proved already that it works for smaller producers?

Matt:

No.

The real profit of that money came from DVD’s and the HDNet pay service. The theatrical run was a money loser.

You guys (Craig and Kevin) sound like Jack Horner in Boogie Nights, “I will never shoot on video!”

Kevin: So, just to be clear on this, you’re saying that without the theatrical release, this movie would have made as much money by going straight to DVD and HD TV?

Matt:

No, it would have never sounded ludicrous to the CEO of a major record company, because music has always been released simultaneously on all formats.

As well it should be.

Music isn’t exhibited. Movies are. Music wishes it could be exhibited. Think about it. If record companies could get people to show up to ampitheaters and pay money just to listen to records without actually owning copies…

…you think they wouldn’t?

Matt:

Bubble has had relative success as a DVD. It is a total failure as a theatrical release, and almost surely did not recoup its release costs.

Craig - here’s why a producer would consider going day and date or not going to theaters at all - even with a large studio ($40M+)film:

http://www.videobusiness.com/article/CA6290331.html?text=scott+hettrick

(This is the Marvel story I talk about above)

We will never know if Bubble would have done well at the theater because the major thaters all boycotted it.

Craig: So, I must have imagined that last Metallica concert I went to then.

Matt:

A concert and selling CD’s are two completely different things.

A concert is a LIVE EVENT, much like going to a play.

Music CD’s are a product that is sold through the record label. And record labels don’t see that concert money. It’s shared between the artist and the stadium that owns the venue (Clear Channel being the biggest).

Matt:

Oh, I’m sorry. Did you attend a concert in which Atlantic Records played you a CD of Metallica?

Or did Metallic actually show up and play?

Understand that if you saw Metallica actually play, then the record company has zero stake in that event. That is entirely a Metallica operation, done at their expense and for their profit.

If you saw a large array of speakers playing a CD, then I apologize. :)

Unlike music, the movie business owns both the copies of and the exhibition of the movies.

Bill:

In that article, Arad talks about a direct-to-video release, not a day-and-date release. The reason he wants to do that is because he believes that he, as the producer, will make more if he eschews profit-sharing with a studio (as only a studio can pull off a wide release). In my opinion, he’s nuts. :) Then again, he may be looking at what he got from Spiderman, and is thinking that he’d rather get a bigger slice of the pie next time.

I still think he’s nuts. :)

Angry Boy:

Major theaters boycotted Bubble? I’m sure they did, but not because they viewed it as a threat (which they did), but based on what I’ve read, it may be one of the most uncommercial films released in this decade. A 70 minute film starring three non-actors? As one reviewer put it, it was almost as if Soderbergh was daring people to actually show up.

Would you say major theater owners boycotted Gummo? Or did they just not think they’d recoup the costs of dedicating a screen to it?

It’s like comparing a Book to the Play.

Craig + Kevin: So the record company have no interest in the tour? They’re quite happy for their artists to sit on their collective behinds until the next CD comes out? I don’t think so.

Nit picking aside, your argument was that record companies wish they could exhibit their product. I would argue that they do, through tours, concerts and live appearances at record stores and on TV. Not the the actual physical prouduct, sure, but an approximation of what appears on the disc. Whether this is more financially beneficial to the artist or record label is open to debate.

Matt:

Record Companies do not exhibit their product. Whether an executive has an “interest” or not regarding touring, I couldn’t say. But since touring has nothing to do with the money a Record Company makes, it really doesn’t matter where his interest lie.

Do you know which group made the most money in tours this year? The Rolling Stones.

Do you know which group sold the most albums? Not the Rolling Stones

Look, this issue has nothing to do with interest.

Or consumer choice.

It’s about money. It’s business. It’s not about “smaller” producers banding together to make Day and Date releasing a reality.

Day and Date releasing is Bad Business. It doesn’t make any sense. There’s no upside. If you use Bubble as an example, it did terrible theatrically. It never should have been a theatrical release. Bubble would have made MORE money if it was just straight to video.

It doesn’t make sense.

Period.

And also MTV and radio play too.

Craig: If that’s why the theaters refused to show the movie, that’s one thing. What I read was that Regal Cinema is refusing to show ANY film that is released on multiple formats the same day.

We need a film that can actually bring in a decent sized audience to see if there will be an impact from day and date release. May I suggest Scary Movie 4.

Kevin: You keep writing as though the success of the movie is based purely on its box office receipts. That’s the whole point: it isn’t. It’s based on the amount the movie cost to make and market, and the return from theatrical, HD Net and DVD COMBINED.

That’s the whole point of the ‘day and date’ business model. It isn’t designed to bolster one revenue stream. It’s designed to bolster them all.

Sorry, last rant. I think the thing most analogous to the whole Theatrical Release vs. DVD Release is in the book world. Books come out in hardcover and then in paperback. Or they come out straight in mass market. Or in the case of the Da Vinci Code— it is just now being released in mass market and it came out in hardcover three years ago! Of course, milk it for all you can. A similar thing happens with the movies, sure. But there is one major difference: the hardcover book is availabe for everyone to read, the theatrically released movie is not. This is my argument for the day and date release. You want to make your product available to as many people as possible, and especially to the people who WANT to see it. I would have downloaded or bought a copy of Kiss Kiss Bang Bang the day it came out. It was showing in New York and LA, but just because I was living in Portland I wasn’t allowed to see it. Like I said I would have paid good money to see it (maybe $20-$40) on the day it came out. There has got to be a better system than the one we have, a way to merge the new technology.

Matt:

Kevin: You keep writing as though the success of the movie is based purely on its box office receipts. That’s the whole point: it isn’t.It’s based on the amount the movie cost to make and market, and the return from theatrical, HD Net and DVD COMBINED.

Matt, I totally, absolutely, agree with you.

Of course…you realize you just made my point, right?

Bubbles never should have been put in the theatre. There was no return from the theatrical run. The film actually LOST money because of the theatrical run. If Bubbles came out direct to video (and the HDnet), it would’ve been better for the movie.

The theatrical run was nutty because it was unnecessary and costly.

Day and Date Release doesn’t bolster all revenue streams. It hinders them.

Any Big Budget or Moderate Budget sized movie would lose a ton of money on the theatrical run; both domestically and internationally. It’s pretty simple.

You release the movie theatrically, let it play out domestically and internationally. The film had a decent run and you collected as much as you possibly could have. Then you release it on DVD. And you collect as much as you possibly can. Then you release it on Pay Cable and then Broadcast Cable…and collect as much as you possibly can. This model is the very best way to get as much money for your film.

It works. It’s smart. It’s proven.

For a lack of a more eloquent sentence:

Day and Date releasing is retarded.

You’re also forgetting who buys DVD’s.

Think of it this way…

Let’s say you have 100 people. And Universal Studios just made The Incredible Adventures of Matt.

If you do a Day and Date release for the film, you’re making the consumer choose. Either the Theatre or the DVD. It’s very likely no one is going to buy the DVD and see the movie 2 days later. So you’ll have about 50 people going to the theatre and 50 people buying the DVD. Not very smart.

The way it works now is, the people who buy the DVD of a movie fall into 2 groups. Those who have never seen the movie and those who have seen it and want to own it. Because a sufficient time has passed, the consumer doesn’t feel like they’re paying for the same thing twice. And believe it or not, most DVD’s that are sold are to people who have already seen the movie 6 months ago.

It’s a Double Dip. The consumer doesn’t have to choose. They paid in the theatre and they’ll pay for the DVD.

That’s the way it works now. It’s a very smart business model. And that’s how you make more money for The Incredible Adventures of Matt.

“P.S. - Did anybody go to see the WGA seminar on “DOWNLOADING THE FUTURE: HOW TO SURVIVE AND PROSPER IN THE NEW ERA OF DIGITAL PROGRAM DELIVERY”? I heard it was a bit of a bust.”

I didn’t go, but a frind of mine snuck a handicam in, so I ripped the vid off his PTP server. I’ll burn you a DVD for five bucks. ;)

Seriously, though. There are some instances where this sort of release would be good business, and some where it would be bad. If your film has legs, it would be suicide. If your film has high hype/anticipation value, it would be madness. To use specific examples, if SHREK had been released this way, it would have been a disaster, since the few people who saw it right off would have just bought the DVD and passed it around to all their friends (r had them over). But for SHREK 2, a hugely anticipated but shallower movie, it might have worked well. With S2, everyone showed up on opening weekend, and they would probably have been more likely to buy then than after 3 months, when the realization that the sequel wasn’t quite up to snuff had finally set in.

Trouble is- if studio’s try this then “Day and Date Release” will just become a euphanism for “Stinker”.

It’s hard to see how BUBBLE is much of a lesson in anything. It was the first shot at something they’ll probably be screwing with for a while. Hollywood would love theatrical release to be primary forever (and I would, too), but steadily declining audiences and new technology strongly suggest it just isn’t so. I think Soderbergh and his investors are looking at how to establish a movie’s brand in some way other than spending 20 million or more in P & A. It is certainly possible that theatrical release will be more of a loss leader to establish a picture than the main event, even for the future equivalent of a wide release.

On the day Bubble was released, I was in a video store in Los Feliz and I overheard a guy say, “Wanna go see Bubble?” Honest to God, his friend replied, “What’s the point? Let’s just get it on DVD.”

For any widely released film, I think day-and-date clearly hinders the success of the theatrical run. I don’t think you can persuasively argue otherwise. And I for one am not ready to give up on the theater experience. Perhaps filmmakers, distributors and theater owners could work together to find a way to make the theater experience more dynamic, instead of letting it be eclipsed by home viewing.

The only type of film that justifies the day-and-date release structure in my mind is the small, niche film that is only going to receive a limited NY-LA release anyway. Someone made that point above, and I do agree with that.

What if you took the DVD release out of the equation, and combined a theatrical release with pay-per-view and downloads?

Matt:

Same problem. You’re working overtime to figure out how to get people to buy something once when they’re currently buying it twice. It makes no sense.

Unless you’re coming at this from the consumer’s point of view.

Why in the world would you take the DVD release out of the equation? It’s the most profitable.

Take the theatrical release out of the equation.

Guys! You’re saying “It hinders the theatrical run” like it matters! Get with the program and understand that the theatrical run is just a marketing campaign for all of the other property rights involved. In most cases it is a “loss leader.”

What Soderbergh and Cuban have done is compress the very expensive marketing campaigns for all the revenue streams - theatrical, DVD, cable/tv and international - into A SINGLE MARKETING CAMPAIGN.

They have simply cut costs.

Bob Iger wants to do something similar and have the DVD available for purchase in the theater after you see the movie. They do it for CD’s after Broadway shows…is he crazy too? (Don’t answer that until they sort out this whole Pixar/Circle Seven debacle and waste)

A question: How many of the theaters that screened the film were Landmark theaters? How many were digital projection? I would be interested to know what the print costs were…if any.

Get with the program?

Did I not use the exact phrase “loss leader” in my post?

That’s the point, Bill. You talk about “compressing the marketing campaign” like that’s some brilliant idea that saves money without costing you anything in promotion.

My father-in-law was in the Burger King business. He understood that the hamburgers were loss leaders. You sold hamburgers at either a loss or a razor-thin profit margin in order to get people to buy the fries and drinks, which had huge profit margins.

So…should he have “compressed” his loss leader by only selling one kind of hamburger? No.

The entire point of a loss leader is that YOU LET IT LEAD.

How the hell is a day-and-date theatrical release LEADING anything? The theatrical release creates an appetite for a subsequent release. Serving the shrimp cocktail at the same time as the steak isn’t going to make people hungrier for the steak.

If Broadway shows could be performed simultaneously in 3,000 playhouses across the country…then YES…it would be insane to sell the CD’s in the lobby. They can’t, so it’s not.

You have to understand that Iger is partly positioning Disney for upcoming negotiations with unions. That’s part of why they’re pounding this day-and-date drum. If he really believed in it, he would DO it.

What’s he waiting for? He runs the studio.

“Guys! You’re saying “It hinders the theatrical run” like it matters! Get with the program and understand that the theatrical run is just a marketing campaign for all of the other property rights involved. In most cases it is a “loss leader.”

Huh? How did you come to this conclusion?

“Bob Iger wants to do something similar and have the DVD available for purchase in the theater after you see the movie. They do it for CD’s after Broadway shows…is he crazy too?”

I think I’m out of the loop on that one, I haven’t heard this statement from Bob Iger. And yeah, if he did want to have the DVD available for purchase after you see the movie, that would make him crazy…

Again, Broadway shows and movies are too completely different things. When you go to a play, you are paying for the live performance. A CD is a product that contains music.

Now, if you wanted to have a place where a movie’s soundtrack was available after you leave the theater, that could work especially if it was a Cameron Crowe movie.

“What Soderbergh and Cuban have done is compress the very expensive marketing campaigns for all the revenue streams - theatrical, DVD, cable/tv and international - into A SINGLE MARKETING CAMPAIGN.”

Okay, here’s an idea. You create a Marketing Campaign for the DVD and not spend money for a ridiculous theatrical run. That way you actually don’t spend more than you make.

Kevin: I meant take it out the equation in terms of a ‘day and date’ release, not elminate it altogether.

Presumably, people are renting the DVD because it’s signficantly cheaper than going to the theater.

If downloading or pay-per-view was as expensive, if not more expensive than going to the theater, wouldn’t that make everyone happy?

Yes, Matt— now that’s what I’m talking about. Only make the DVD availabe to PURCHASE the day the film is released. Months later you can have it available for RENTAL with extras at a far cheaper price.

Kevin -

1. “I think I’m out of the loop on that one, I haven’t heard this statement from Bob Iger”

re: the Wall Street Journal interview with Iger (taken from Video Business)

“In an interview in last week’s Wall Street Journal, Iger said he would like to see DVDs of new theatrical releases available for moviegoers to purchase in the lobby of the theater as they exit after having just paid to see the same film, just as CD soundtracks are available when consumers leave a Broadway show.”

1. “Huh? How did you come to this conclusion?”

From the Washington Post review of Epstein’s book THE BIG PICTURE:

“The blockbusters do well enough in American theaters — the first “Harry Potter” pulled in more than $317 million — but ticket sales are a drop in the bucket: That film’s total earnings as of last year were $1,249 billion, the biggest chunk of which ($436 million) came from worldwide DVD sales. In effect, as Epstein persistently argues, theatrical release now exists not to make money but to open the way for “intellectual property” income to be earned over the long term from other sources.”

Here’s the link to all the reviews for THE BIG PICTURE on Amazon.com —

http://www.amazon.com/gp/product/1400063531/ref=ase_craftyscreenw-20/104-3124788-8020764?n=283155&tagActionCode=craftyscreenw-20

That “ridiculous theatrical run” - while losing money for Bubble - is part of the overall campaign for the other rights involved in the picture whether or not the theatrical LEADS the pack.

(Sorry Craig, I forgot you did say, “loss-leader” in your post)

A theatrical run is an important component of a film’s international sales. Many companies four wall their pics just to be able to say it had a theatrical run when selling the DVD/TV rights to films on the international market. (Example: Fabrication Films)

Day and Date compresses not only the time. but the cost, and maximizes the value of the film overall - especially in the international territories. If they had released Bubble simply on DVD they would have lost money in the international market.

Craig - think of it this way (to use your hamburger terms):

Cuban and Soderbergh have sort of invented the “combo meal” for the movie industry. It’s a sales strategy that works “together.” They have to have the burger there (theatrical) in order to sell the fries and drinks (DVD,Cable, etc…).

It works SLIGHTLY differently, but they are saying - “you can buy the combo - no waiting.”

They are not selling burgers, waiting four months then selling fries, then another four months for drinks.

Yes, it is crazy. But it is a crazy that is going to yield them better returns than drawing it all out via sales windows. Especially for the international market.

No one has mentioned the fact that the possibility exists that someone may see a film on DVD - and then go to the theater to see it on the big screen (It has happened with several pics that have been shown on HBO/Showtime then released theatrically).

I don’t think it is going to happen with Bubble, but with a larger genre picture - perhaps…

BILL:

So much for accuracy in the newspaper…

“The blockbusters do well enough in American theaters — the first “Harry Potter” pulled in more than $317 million — but ticket sales are a drop in the bucket: That film’s total earnings as of last year were $1,249 billion, the biggest chunk of which ($436 million) came from worldwide DVD sales.

That’s actually totally inaccurate. Harry Potter and The Sorcerer’s Stone made $317 million domestically, and $650 million internationally.

That’s almost a billion dollars in ticket sales.

In fact, the international box office grosses have been so powerful that they’ve made films that were regarded as flops in the US, hits overseas (i.e. Troy)

Day and Date releases would totally destroy the international grosses. If Brokeback Mountain was released in this manner, the money that it made in the theatre would have been completely destroyed.

There’s a market for a Dolph Lundgren film. And it’s in Direct-to-Video. Giving it a theatrical run is a waste of money. And that’s why they don’t do it. And that’s why it will never catch on.

Because it doesn’t make any sense.

Because you limit your audience.

“That’s almost a billion dollars in ticket sales.”

Ticket sales does not mean that’s the studio’s take from a picture. Just because a film does X amount in a territory overseas doesn’t mean that money comes back to the studio. Many territories are pre-sold for a flat fee and small percentage of the gross.

I understand that 100% of ticket sales don’t flow directly back into the studio. It’s actually closer to 40%. But we’re still talking about $400 million dollars in profit for the studio.

But just imagine what would have happened with a Day and Date release of Harry Potter. I don’t see how you can make any realistic argument that it would have made more money that way.

Bill, why would you sell something once, when you can sell it twice?

Craig: One other point, you mentioned in your previous response that the theatrical release creates an appetite, expectation - what ever you want to call it - for the release on DVD.

Back in the days when you had to wait a year for the release of a videotape this may well have been true. But the window between theatrical and DVD release has shrunk considerably. Factor in the availability of movies through illegal download, and I’d say that anticipation for a release on DVD has steadily eroded. Waiting is more of an inconvenience than anything else.

The prime time to beam movies straight into homes pay-per-view would be at the same time as the theatrical release. That doesn�t limit your audience � it increases it. It also allows you to reach more viewers before the onset of disappointing box office or other factors - such as poor word of mouth, or unfavorable reviews.

Bill:

By the way, more and more studios are shying away from pre-selling films that they deem will be box office hits.

Especially Sequels.

Matt:

I have one question…

Are you arguing as a filmmaker or a consumer?

If you are a filmmaker that intends to have a film in the theatre you should KNOW that Day and Date doesn’t increase your audience. That’s nonsense.

But if you’re primarily thinking from a consumer’s point of view, then yeah, it would be way more convenient to have the choice.

Anyone familiar with the “long tail” model? Perhaps if we applied this to the present argument…

Kev,

To be truthful, I’m arguing from the perspective of a movie lover who just wants options. I love going to the theater. Sorry, let me rephrase that: I love going to theater when there isn’t a strand of hair dangling over the projector lens; when there isn’t some asshole talking on a cell phone - or some girl asking her boyfriend to repeat verbatim the last line of dialogue that she missed, because she was too busy spilling her whopper sized diet coke on my lap.

Technological advances have changed the whole way the industry makes films and it could change the way they’re distributed as well. Home entertainment systems are becoming more and more affordable, while tickets to the cinema seem to be getting more expensive. Netflixs are going into distribution and would love to give their customers the option of downloading from their catalogue. I’m not a business major, but it’s a case of supply and demand. If enough people want it, then pay-per-view or downloading on the same day as a theatrical release could really be a viable alternative (although I concede that DVD rental on the same day is retarded).

In spite of your argument that it failed theatrically: Bubble did what it set out to do. It worked because of the ‘day and date’ release. I’m willing to bet that it wouldn’t have made nearly as much money as a straight to DVD release. Whether that’s because of its novelty value as marketing ploy, remains to be seen.

There will always be a demand for movie theaters. It’s a shared communal experience that you can’t beat. All filmmakers gravitate to that, because its where the dream of making movies starts – sitting a darkened theater. I would never want to lose that because as filmmakers it’s what we all aspire to – seeing our work up on the big screen. But neither do I believe that the ‘date and day’ release, if it became the norm, would be a death knell for theaters.

From Mark Cuban himself:

Mark.Cuban@dallasmavs.com>to me 3:27 pm (15 minutes ago)

simple reply you can post.

Most movies lose money. This one is already making money. So we win :)

Bill:

Mark’s comment reminds me of the blackjack player who splits 10’s. Everyone tells him he’s made a strategic error, but when the dealer happens to bust, he says, “Did I win? That’s all that matters.”

The object isn’t to “make money”. The object is to maximize profit. Mark Cuban clearly knows how to do that in a number of arenas. I’m not sure he’s on strong footing in this one.

Furthemore, I dispute his statement that most films lose money. Everything I’ve been told leads me to believe the opposite is true.

Matt:

I appreciate the honesty, and it explains a lot. As a film businessman, my goal is to separate you from your money. As a film-goer, your goal is to get as entertained as possible with as much freedom as possible for the least amount of money as possible.

This may be why you like day-and-date, and I do not. :)

It got all wrapped up in that pseudo-revolutionary Venture Capital-fueled overhype pitch; ‘Bubble’ is quite the fitting name.

Video didn’t kill the Radio Star, VCRs didn’t kill movie-going audiences, Click didn’t replace Brick, Bloggers haven’t replaced Journalists, DVDs/File Sharing won’t kill Hollywood. It all makes for a nice clean-cut one-note journalism piece, but the real world doesn’t work with such simplistic formulas. Anyone telling you it’s a “disruption”, is trying to con you, and sell a piece of the action, before they hightail out with the cash. But what to expect from Cuban, who short-sold a bag of pure fool’s gold, Broadcast.com to the irrational exuberance-era duped Yahoo.

Bubble came and went, with nary a peep. D2D where it belonged in the first place, imho.

Most movies lose money? That’s some real fuzzy accounting there, doesn’t square one iota with the Hollywood I know, I totally side with Craig, the opposite is true.

Made money? How on earth? You can’t get Soderbergh to sneeze for what they have made. If a gratis, low low low budget college-kiddie artsy film-school drunk on way way too much Robert Rodriguez, well maybe, but even then. Regardless such doesn’t reflect well on the film itself. I don’t buy it at all, not one bit. But these webbles wobble and don’t fall down. The greatest loss of human wealth in history, and the Web 2.0 nutters and hype-makers are up for another round of batting practice, only now using the same dead-tired rhetoric all along Wilshire.

craig

agree. there is nothing to fear (probably) from the bubble-style release.

disagree. the days of going to the movies are over. it’s not a 6% down tick. it’s 8-10%. it’s also the second or third consecutive down year. factor in the corresponding dvd rental/purchase uptick of 9-11% and…well, it’s pretty clear.

the movie theater experience is history (probably), but so is the day and date release strategy (probably)

z

Just to sidestep the main argument for a bit, I would love the option of buying the dvd of the film I just watched in the theater. Perhaps even attach a slight discount if you buy it at that moment. To me, that’s a win-win. How many of us buy dvds of films we’ve seen in the theater? A lot of us, right? So what’s the problem with having the option of doing both, neither, or one of the two?

To me, Bubble is a success because it has created a new path, one that I’m certain will be exploited more and more. It seems to me, lesser films can gain exposure by doing this, and frankly, the way Hollywood is churning out remakes in record numbers, that can only be a good thing. I don’t think Bubble making loads of cash at the theater was the point. If it makes money from all three outlets, then it is a success, no matter where that money originates from. Had it been straight to DVD, would it have made the same amount it’s going to make now? I highly doubt it, the buzz this created was more than any marketing genius could concoct. And mark that up to hype all you want, but the fact of the matter is every theatrical film relies on marketing and hype, so Bubble is no different in that regard.

Congrats to the Bubble crew - it was a great gag to generate interest in their film. However, with the risk of sounding very “uncool”, I love the idea of DVD and cinema release coinciding. There are certain films I prefer to watch home alone than in the cinema (the more thought-provoking ones for example) and a DVD coming out at the same time would allow me to do this, whereas the more BIG productions I could then go watch with people hooting, cheering etc as part of the show. But then that’s just me.

Last comment…

The days of movie-going are not over. Sure some adjustment, and maybe some downtick (to be expected), but that’s all been accounted for, and this trend really only holds sway in the North American market. Movie-going is a social thing, and that will never change. And something to play up and market. It’s not just about the shows.

And this is a tired Chicken-little debate, as Craig said, War, Television, VHS, and then DVDs and an accelerated DVD cycle, HD and better Home Theater systems, annoying Cell Phone users, Rentals, Price of Gas, File-Sharing, In-Theater Advertising, Rising Ticket Prices, Sequel Glut. Pick your poison, and work in the usual scripted Hollywood-is-Doomed lingo, and then cue it up for the next new new thing.

I think the real lesson here, is that theater owners need to be more proactive in getting people in, and the industry needs to create more incentives to push up the numbers. The owners just rely on Hollywood marketing and the big franchises, as they don’t have that deep of a stake, as the real money comes from the over-expensive popcorn. Being more creative at the local level is really the key, as they have all gone commodity churn. But then look to places like Muvico in Palm Beach and indy outfits in small towns, like Reynolds in Morton, IL — movie-going there is an experience, over just the usual ‘can’t-tell-them-apart’ jam-packed megasuperplexes.

I’d approach it as a marketing problem, not only focusing on the films itself.

Regarding the Downtick of movie-goers and box office grosses:

I think it’s very interesting that there are so many articles talking about the percentages versus last year’s percentages but there’s always one important fact that they leave out.

The Number of Movies Released That Year.

‘The Number of Movies Released That Year’, exactly. Great point. They never seem to need any sort of context for the ‘Sky is Falling’ press reports.

As of june 2006, any idea on just how much money the movie Bubble did make?

The fact is, there was no risk in this release platform. It was a modestly budgeted film distributed by the production company to outlets it owns. Had this been tried with “Lord of the Rings” or even something along the lines of “Saw”, it might have showed the real promise or peril of such a strategy. What I felt more interesting was how the film was made, not how it was distributed: going to a small town, employing the locals, shooting on HD. That portends a more reasonable and predictable trend in filmmaking. I can see independent cinema becoming more like local or regional theatre: produce small, inexpensive films with local talent and show it (using video projection) at small halls or theaters for the local audience. The film may never be seen outside its locality, but with subscriptions and marketing it could still make money for itself. There would be no prints to cast, just a DVD to burn (and that same DVD could be sold at the concession stand after the screening). And not to forget television, there are still independent stations (to say nothing of public access) that might take it for an open weekend block (local ad sales and/or a local sponsorship with promotional tie-ins could cover the broadcast costs). Bubble proved nothing because it risked nothing. It’s a write-off for its producers and a footnote in the history of Hollywood.