It’s one of the great ironies of the new Internet economy: As the value of digital content on the Internet falls toward zero because of its ubiquity, the value of real-time physical products increases. While this is promising news for musicians and writers, it’s no panacea for those filmmakers now desperately searching to discover a new business model to revitalize their old industry.
In the music industry, as sales of recorded music continue to fall dramatically, the live music economy is actually doing quite well. In the old mass-media analog economy, musical artists played concerts to sell recordings; in the digital economy, artists like Radiohead, Trent Reznor of Nine Inch Nails, and Prince give away their recordings on the Web in order to sell concert tickets.
The same is true of writers. As Chris Anderson argues so convincingly in his new book, Free,
writers are better off giving their work away for free on the Web (as he does with Free) and then earning substantial fees through live lectures and talks. Indeed, Anderson confesses in Free that this is the very business model that might enable him to put his myriad children through college.
But this new model isn’t reassuring for the professional filmmaker, whose core skill lies in the creation of high-quality video content. So the motion picture industry, which began at the start of the 20th century as the “people’s art,” is now vulnerable to being destroyed by the new people’s art: free online video.
Like the music business, the movie industry is now going through its own perfect storm. On top of the dreadful damage that both online and, particularly, DVD piracy is doing to the industry, the plague of free video content on Websites like YouTube Inc. and
Dailymotion is really killing the movie business.
Yes, of course, there are movie hits -- such as Quentin Tarantino’s latest Inglourious Basterds, which grossed $37.6 million over the weekend (not bad for a movie that “only” cost $65 million to make). But as broadband pipes expand and we see the emergence of Spotify-style “freemium” video businesses that stream universal movies on demand, it’s very hard to imagine how most people in the motion picture ecosystem will make money, especially from first-run theatrical releases.
So what becomes of movie-makers in this “free” economy? Unable to extract cash from their primary business, how will they pay their mortgages and feed their kids? Like Ridley Scott, they could make their money by creating television advertisements (if TV still exists -- which is also questionable). Like Francis Ford Coppola, they might buy a vineyard and get into the wine business. Like the owners of San Francisco’s “Foreign Cinema” restaurant, they might even open a fashionable eatery that will show free classic movies while consumers eat expensive food.
Internet activists like Cory Doctorow who share a dislike of Hollywood’s big business model welcome the collapse of the mass media movie industry. They believe that the movies of the future will be made on a shoestring and thus will require minimal revenue to be sustainable.
In January, Doctorow told Internet Evolution readers that the “secret” of the movie business is “cheap,” “crummy-looking YouTube video” product that won’t be “pretty” but might be “perfect” for the “38 other people who are kinked just like you.”
And what will be the business model of these “crummy looking” videos and their 38-person audience? According to Doctorow: “Some of this stuff will be sustainable through donations, others through advertising/sponsorship, and others still will be conducted on a non-economic basis.”
That might sound rosy to idealistic Internet activists like Doctorow, but try telling a movie director that he should conduct his work on a “non-economic basis.” It’s such an absurd notion that he might even make a (free) horror movie about it.
— Andrew Keen, Silicon Valley author, broadcaster, and entrepreneur, can be reached on Twitter at @ajkeen.
I go to the movies for a purely escapist ,get out of my daily routine kind of entertainment.Thats something I dont get by sitting at home or as so many of my colleagues like do ,at work.You have to go to the movies,to see a movie uninterrupted-atleast thats the way I like it.At home there are way too many distractions ,so much so that I dont really enjoy watching a movie at home ever.bTW I am those who doesnt believe in Convergence and the Blackberry-I think its pure,unadulterated Torture.
With every new incarnation of media that arrives on the scene, doomsayers predict the death of all that went before. In some cases, like the 8 track, it happened but then how does one explain the resurgence of vinyl? Each new media format will bring innovation. Those that can adapt, will survive and may even flourish. Others will be replaced. It seems to be the natural order of things.
I’m not in the film industry, but I know a few people who are. There is certainly a vast amount of untapped talent available to post free videos on the net. But these people may not have the experience or equipment to produce feature length films of sufficient quality to market them in the competitive world of cinema. This does not belittle their ability or drive, just a statement of the way things are. These talented newcomers are most likely posting their product to gain recognition in hopes of becoming a highly esteemed filmmaker in the mainstream industry anyway.
I don’t believe net video will kill cinema. It may force some changes, but there will likely be a market for movie theaters of many years. I personally find very difficult to enjoy even a short video on such a tiny little screen. I also enjoy the interaction with the audience when you experience the collective gasp of suspense. This will be difficult for net video to duplicate. People have their home theaters, but you just don’t get the same feeling as a packed theater jumping when the alien crawls out of a stomach. It’s all about the experience.
Mainstream actors may need to curtail their demands for millions to appear in films in order to make them profitable. They were not always top dog, and new talent pops up to unseat them with regularity anyway. If the prima donnas of the industry don’t get asked to be in the film because their demands are to costly things will necessarily change.
I also recall stylist changes, innovations in filming that put you into the action that crossed from television into theater and vice versa.We’re still seeing black and white films and dubbed films and other formats made in tribute or just for artistic reasons. Competition and change are healthy for industry. Monopolies tend to sit back and maintain the status quo. You run a little harder when the new guy is right on your heels.
Cinema should capitalize on the free video to market shorts, trailers and teasers. Getting the audience into a character or plotline before they even reach the theater would be very valuable. A short film with some or all the main characters would generate interest and build the story.
I don’t think the cinema is in danger of going out of business too soon. It will have time to respond, adapt and evolve into some more competitive.
the future of media, and movies, is in good part linked to the success of a business model.
business models should be affected by what people like and dislike, of course
this might make you think that audience, people, determine what kind of content and business model can succeed or fail
but today the power of media is so big that it's the media that influence audience's preferences, and make them think that a content is good or bad, thus creating the success of the content itself
talk about movies: I don't believe that today's blockbuster movies are good movies. They're often terrible. No quality, just marketing. But people like them.
and how about reality shows? awful. Big Brother has been the most boring and stupid tv content ever, but it's been a success story thanks to the infinite power that television has to influence the audience preferences, making them believe they could not live without the Big Brother. Come on!
so what's happening now? new, very powerful players (google, microsoft, etc....) are reaching people in a way no other media can, and they're making them think that the new way of doing news, entertainment, is a different way.
user generated content, free content, social media. and, mainly, free! gratis!
and people follow them. and think that it's no longer a good thing to pay a ticket for a big movie, but it's better to watch small productions for free, or even amateur contents.
and they start producing contents, because that's the way things go today.
as the internet grows in becoming mainstream, this is of course rapidly destroying the old way to make journalism, information, entertainment, socialisazion, starting from disgregating their basis, the business models.
it's an interesting fight: the movie industry trying to say "hey, here is brad pitt! but you must pay to see it" and on the other side the internet says "stop paying for contents, here are a lot of free things. They might not be so good as hollywood productions, but they're so many, and all for free! and you can also produce and distribute your own!"
also consider that if you want to download the latest tarantino's hit, you can do it for free with bit torrent....and this is another way the internet mines the movie industry basis....this is really a subtle way to fight against your competitors.....
I think that the entire movie industry should understand that the internet is going to be the main distribution channel, and that new ways to make money out of high level performances and productions should be searched quickly. Wether giving out movies for free and then having actors playing short parts live, or whatever, it's hard to say
the interesting thing is that the push to innovation is so strong, and things happen so fast, so something will have to change rapidly in the very next years
I read the whole series of comments before I started posting, which people might presume is an appropriate thing to do in a blog. Maybe that's too much effort for a man of your experience.
I never offered an opinion anything resembling amateurs killing the movies. If you'd read my messages earlier in this blog, you'd see that I have the contrary opinion. What a silly mistake for you to make. You said "Just think how Lord of the Rings, GI Joe, Star Trek, and most other awesome movies would have been if they were made on an online video budget. They wouldnt exist, or they would be laughable." Which is what I responded to.
You repeated misquote me as suggesting that film production is somehow trivial or simple. My statement was "You get a lot more technology for your money today, and shoestrings aren't as short as they once were. There's also a lot more talent in the amateur space, and amateurs are far more likely to have professional-quality tools." I'm not sure how that rubbed you so raw, but whatever.
My so-called inflammatory comment reads "I think you're watching 10-second clips of a butt-picking monkey and figuring that this is the limit of amateur video. I don't think that's a fair snapshot of the future."
Perhaps you can note the significant difference between what I actually said and what you've quoted me as saying: "[You] only watch monkeys picking their butts." With reading skills like that, you must get offended quite often.
Incidentally, your profile here is blank. IMDB lists two emmy wins as executive producer for a "weekly tv series" called "Kids Guide". Curiously, the 2006 emmy list shows you as a nominee for "Children/Youth (12 and Under) – Program Feature/Segment" for which only shoestring-budget children's documentaries were nominated. Of the five people involved in your show, I see that you are listed as executive producer with your kid starring as host. I can find no online reference to this show ever being broadcast. The only review (or rating) for it on Amazon.com was written by a "concerned parent" *wink, wink* who also reviewed a book that you wrote an endorsment for.
Kudos for making a kids documentary, and double kudos for your win (not that you had much competition), but consider yourself busted. The only "quality tv and online video" that you've been involved with is the same low-budget drecht that you're criticizing.
Here are the problems everyone seems to be having in the critical responses to your posts. Fundamentally, the title of the article everyone is responding to is: "ONLINE VIDEO WILL KILL THE MOVIES", not online video producers now have good equipment.
Then you start with inflammatory comments such as I only watch monkeys picking their butts. Then you call Final Cut "stupid". Honestly, I dont know how much experience you have in the industry, but I have 3 Emmy awards among 30 other awards for producing quality TV AND online programming. Your Final Cut comment is at the very best grossly naive, and demonstrates a lack of understanding of the industry, as Final Cut is just about the industry standard in the TV industry for professional editing. While the base Final Cut software is $1500, a good editing suite, which requires perfectly set monitors, sound systems, etc, is easily in the $30-50K range. Also, while the software itself is $1500, that doesnt include critical add ons, which can put the software itself well over $10K.
So if you want to say that people have access to what could have past for low grade professional equipment 5 years ago, you are correct. That however is a far leap to saying that this will "Kill The Movies", or even come up with similar quality content. Most importantly, it doesn't address the leaps in innovation, that the current movies have and drive.
Are you familiar with a straw man argument? I never said that it was easy; that's an argument you conjured up. A project of feature-length magnitude will take a lot of time and effort for an amateur, just as it does for a professional. There's no question about that.
I'm reading comments in here about how consumers can only produce grainy clips on youtube. Your own take was that nothing of a professional caliber can possibly come out of the amateur world.
I argue that amateurs have more money for equipment in the past and that professional quality gear is much cheaper. You make a stupid "Final Cut" response. I point out that normal people have real gear, and you stick to your "it's so easy" counter-response.
I don't really see the social aspects as much anymore, works best in rousing action or scary movies. Yes, seeing Alien Vs. Predator 2 with a bunch of loud mouth teens behind us ruined the movie, and then my wife was "shusshed" because of her complaining to them! But Titanic at the theater was spectacular, less so on TV. My favorite experience is Rocky 3. I didn't really think it was a good movie, but the audience excitement added so much. Not the same as on video.
But later posts talked about YouTubers remaking movies like Star Wars. Well, the acting talent was a little lacking--not too bad for zero-mortgage the house budget--but Star Wars: Revelations, I think made for $40k (because no one was paid) had a spectacular SFX chase that equaled anything that was in the last three movies (or the first three chapters--whatever George), and was much better than some of the video gamish looking effects in GI Joe.
I used to do stop motion animation with my toys, like Robot Chicken, in the Super 8 days--I was SO ahead of my time. At 15 dollars for 3 minutes of film, it was prohibitively expensive to make much of anything, and compositing? Forget it. You had to shoot against black and pray your manual forcing of the film backwards into the cartridge would line up with the next shot so your first image wouldn't ghost over the second. No blue screen back then.
Flying erase heads weren't affordable for the consumer until the mid 90's when decks came down to the $500 range, so until then, you needed 50k of "professional" gear to create any kind of cleanly edited movie, but you were still working with VHS or Beta where the resolution is like comparing 35 mm to professional 3/4 U-Matic being IMAX.
It all comes to talent and paying attention to the little details, like lighting, editing and pace. Then of course, actors who are believable. In person, I can be very animated. On film, I'm stiff and my voice becomes whiny and robotic.
And animation? I realized when I saw the first digital cameras that they could be eventually used to do stop motion very cheaply. The famous coal car chase in Indiana Jones and the Temple of Doom was shot with a Nikon 35 mm camera with the 100 ft roll back, so why not digital? A few years later I saw that Tim Burton's Corpse Bride was shot with Canon 1 DS digital cameras.
At least half the cost of a movie is salaries. If a bunch of talented amateurs got together and "put on a show" with their cheap HD cams and laptops, they could beat Hollywood. But the only real way that movies and movie theaters will be killed is when a big budget movie debuts online rather than a movie theater, and it still makes back it's costs.
The Internet which was initially thought of a facilitator, then an enabler is now proving to be a disruptive technology for so many businesses: yellow pages, book publishing, news papers, movie industry. And every year more industries are added.
Exciting times. I feel that first decade of this century (with recession, 50% mobile penetration in world's population, rise of BRIC & new uses of internet) would be marked as a tipping point for many old-fashioned industries.
Again, I encourage you to prove me wrong and take your $100K worth of equipment and redo a 30 year old movie like Star Wars.
Even then, your statement that you can get millions of dollars worth of equipment for $100K implies that in 10 years, it will be ok to have 10 year old technology. While I wont disagree that there are a lot of mediocre movies out there, and that anyone can probably produce a short that is the equivalent of a mediocre movie, I expect in 10 years that what will be available will blow the current stuff away. That will not happen when you are relying on online videos for the source of revenue to drive innovation.
Just redo a 30 year old movie, and you will prove me wrong. You and your friends have all the equipment, so again it should be easy.
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