The 401st Blow :: Thoughts On Media

Charting The Wrong Course Through Digital Waters

Posted in Financing, Policy, Software by Noah Harlan on March 22, 2009

I just returned from a great weekend in Virginia (everyone should spend time in a house built 50 years before the revolution sometime) and on the drive back I listened to the fascinating breakfast conversation at SXSW between producer Ted Hope, filmmaker Lance Weiler, conference organizer and producer Liz Rosenthal, technologist Brian Chirls, outreach guru Caitlin Boyle, filmmaker Brett Gaylor, producer and Filmmaker Mag editor Scott Macaulay, and journalist & film technologist Scott Kirsner. All are very smart people and the conversation is definitely worth a listen (the audio quality is not great but it’s worth soldiering through).

As I listened to them wrestle with questions relating to finding revenue in a digital age, I got the sense that there was a battle that had been fought and had already been lost. The battle was over payments for content. The semi-consensus view, and one I know Lance in particular espouses, is that the days of people paying directly for content (or at least paying up front) are rapidly disappearing and we should step forward into a share economy (I’m not sure that Scott was totally in agreement, but I don’t won’t to put words in anyone’s mouths). There was much discussion of putting your work out for free and then asking for contributions from consumers and this model, I feel, is akin to going back to the shareware model on computers.

Software started as free and then (as is mentioned in passing during the audio, interestingly enough) became a product to be paid for. Through that transition emerged a third tier of software – the product of independent software developers – that was Shareware. Shareware came in a few different varieties:

  • Freeware: Software that was freely distributed and free to be passed around.
  • Shareware: Software that was freely distributed but, if you chose to use it, you were asked to pay (on the honor system) a small amount to the creator
  • Crippleware: Software that was freely distributed but was limited in its features and, if you wanted to unlock the full features, you paid the creator

This system has some analogies to the ideas being explored by a lot of people in the transmedia world, notably in Brett Gaylor’s “RIP: A Remix Manifesto”. We’ve seen variations of Freeware & Shareware espoused through Creative Commons and even Crippleware from people like Nine Inch Nails with their (ok, “his”) release of Ghosts with higher audio quality and greater numbers of tracks being reserved for paying customers.

What interested me though, was that noone looked at the iTunes App Store as an example of how to bring payments back into the system.

Recently one of the most successful developers of Shareware for the Mac, Pangea Software, announced they were abandoning shareware development in favor of the App Store after the staggering success they’ve found on the pay-to-use platform. Numerous independent developers have had similar success. (Full disclosure and self-promotion, I have two Apps on the store now and more coming) I believe that there are several take-aways we can gain from the App Store example:

  • One: When offered a seamless way to pay and affordable, quality content to buy, people will pay for content.
  • Two: A seamless system of purchase & usage is vital to a financial model. The App Store only works because of it’s seamless integration with the iPhone. This is the same lesson the record companies failed to learn and why they were crushed by the iTunes music store.
  • Three: The consumer must remain conditioned to pay for content. One of the biggest threats to payments for content is that consumers begin to assume content is free. Does this mean legally hunting them down? NO! The RIAA has done a terrible job on that front. What it means is keeping people aware that they can get more reliable content, at better quality, and be more supportive of the creators by paying a small amount.
  • Four: We need to coalesce the online market. The single greatest obstacle we have right now is, ironically, the sheer multiplicity of options for where to view content. The App Store works because there is only one. If there were fifty, each with different content, it would be less successful. Blockbuster worked this way when we were bricks & mortar bound. Netflix worked this way when we were DVD-bound. Now we need a new solution. This doesn’t mean there needs to be only one online exhibitor (for why I say exhibitor and not distributor please visit this article on the Filmmaker Magazine blog) but, rather, we need consolidated places to find the content. There are some efforts underway to do just that including SpeedCine and the UK Film Council’s Find Any Film but these are just the beginning.
  • Five: Lastly, and this relates directly to point #2 above, we need to have better ways to move our media around. The tyranny of a particular box as viewing platform undercuts any efforts to simplify the process. Boxee and the Apple TV are both good moves in that direction but Boxee is in a tough fight. The studios decided to hamstring Boxee by forcing HULU to pull its content (a move that even HULU thought was wrong) in a ridiculously narrow-minded attempt to keep control of content (and an approach to DRM that is deeply reminiscent of the RIAA’s moronic and self-destructive resistance to iTunes). Until filmed content can seamlessly move from computer monitor to TV screen and back we are going to be behind the eight-ball, as it were.

These are a lot of things to ask but, if it means that content creators can be paid for their work then it is worth it. We need to embrace and fight for the technological innovations that can support our need to support ourselves. While releasing media for free and asking for contributions may work on a micro-scale and/or for the few, amazingly talented promoter/marketers like Lance and Arin, but for many talented filmmakers, it’s not their best skill and they should still be able to make amazing work, pay back their supporters, and earn a living. I do not believe that throwing in the towel and saying we live in a Pirate Bay world now and that we should give up on paid content is the right attitude and doing so will potentially hamstring future generations of content creators in their endeavors to make lives from their work.

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12 Responses

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  1. Tony Comstock said, on March 22, 2009 at 7:59 pm

    It’s really not that hard. Make films people want to see and people will pay you to see them.

  2. nharlan said, on March 22, 2009 at 8:05 pm

    I wish it were that simple Tony but you still have to put your film on a platform that audiences will want to view your film on and then have them pay. There are great films, that audiences would want to see, but that they can’t monetize for any of a number of reasons.

  3. John F said, on March 22, 2009 at 10:46 pm

    Whatever the new models are, there’s also the question of how budgets are impacted. The less money you can make, the less money you can spend on producing work. Of course, more money doesn’t necessarily equal good filmmaking, but it doesn’t hurt. Making movie ain’t cheap. And I’d never begrudge anyone from wanting/trying to make a living from their work. You can’t do that when revenues shrink too low.

  4. nharlan said, on March 22, 2009 at 10:57 pm

    It’s a very good point and one which I think is all-too-often overlooked. There are amazing stories told on micro-budgets but it’s not appropriate for every project and you run into other problems when you have micro-budget film after micro-budget film – it’s one thing for the owner/creators – but what about their crews?

  5. Meeks said, on March 23, 2009 at 11:44 am

    Completely agree that a large part of this is keeping the content affordable yet of objectively higher quality than what is out there and offered for free…

  6. Scott Macaulay said, on March 23, 2009 at 12:14 pm

    Regarding John F and Noah’s comments, I completely agree that micro-budget filmmaking is not a sustainable model for either directors or the crews who make these films. One thing, however, that I (along with the rest of the indie industry) am grappling with (perhaps without always realizing it) is the fact that independent film production of the past several years has been just as much a bubble as other things in our economy. A lot of surplus money — easily raised investment capital, profits from stock sales, etc. — sloshed into indie moviemaking, and this money paid salaries to professional union crew on indie movies that, now that they are made, have little financial viability in the marketplace. This easy money has now departed, not just for the indies but for Hollywood as well. (See today’s Times piece.) Of course, good movies with good casts and good scripts and good directors will still be able to attract funding. More speculative projects with new directors will have a harder time because the new, more financially discerning environment will not support them. The question becomes, are we struggling to maintain this system for everyone or just for the top tier of projects? And are there other ways that are less dependent on the costly apparatus of feature filmmaking for new talent to launch media projects into the marketplace?

  7. nharlan said, on March 23, 2009 at 12:43 pm

    To draw on your thoughts here Scott, I think the real question for the future is for the mid-career filmmakers. The start-ups will be frolicking in the media project pool and the Hollywood apparatus is here for a long time to come but what about the professional indie filmmakers of medium-budget films. This reminds me of when Apple launched Final Cut Studio and everyone said this was the death of professional post-production but, what they were ignoring was the fact that you still needed skilled professionals with years of experience at the craft of editing or coloring or sound mixing. Sure the medium has been democratized but not the skills and it takes time for those skills to develop. When the aspiring media artist becomes married, with a family, children wanting to go to college, parents who need health care – that aspiring artist begins weighing financial concerns. Their friends who were happy to volunteer are now needing to make money. So what then happens to that part of the industry?

  8. Scott Macaulay said, on March 23, 2009 at 2:52 pm

    Actually, I think it’s less about mid-career filmmakers than it is about compelling, not necessarily commercial work of a medium budget. In the past week I’ve talked to or heard about two filmmakers in their 30s, both of whom you would know and both of whom have made one or two features. Financially, both are doing okay. They have writing assignments, or are directing TV episodes and pilots. Are they making the stuff they want to make, the stuff that is “theirs”? Not necessarily, although the work they are doing is enough in their interest zone to feel worthwhile to them. Would they love to be earning money and supporting families with purely their own stuff? Absolutely, but that’s not what the market is letting them do. The market is, however, recognizing their talent and offering them employment opportunities.

    I am not sure we are actually saying different things, but to answer your question, “that part of the industry” can find work. What is disappearing is financially remunerative work for people whose work does not seem immediately more commercial who want to make for money that same not-really-commercial work. Maybe it’s always been like this, but I think more recently the kind of things you could convince people to believe in — “it’s been through the Sundance Labs!” or “small films are selling big!” — are less convincing.

  9. nharlan said, on March 23, 2009 at 3:02 pm

    I think we’re probably circling the same idea and using different semantics to describe it. I definitely hear the issue with marketability. We’re in the throws of it on one project that has so much going for it that it would be a slam dunk to finance two or three years ago but right now, it’s a knock-down, drag-out fight. The question is, should we go down and make it for $500K? What does that do to the creative vision of the film. Do we make a different film, with a different kind of cast and different aesthetics? I don’t know but it’s something we have to consider. That being said, we’ve spent a couple years trying to make one film and to reconstruct it on that new scale is painful and challenging. The hope, if you do decide to do that, is that you won’t lose something that was part of your vision in the process.

    It’s interesting, I feel with some of the evangelists there is a belief that you have a scale and on one axis is money and the other is some abstract idea of artistic purity and that by reducing the money you are somehow more pure. That the encumbrance of investors and fiduciary responsibility somehow diminishes the art and that, if you want a bigger budget, that you are not being creative. But I don’t buy that. There are things you can’t do on a smaller budget, there are limitations and constraints and to want to work without those restrictions does not invalidate the artistry of the product.

  10. Jeffrey Travis said, on March 25, 2009 at 10:41 pm

    I completely agree with nharlan. I am a mid-career filmmaker, 4 kids, wife, I’ve made films that have made money for me and the people involved, yet… there is a sense in which it really is not sustainable to continue doing the micro-budget films.

    I run into people all the time who say “make 10 movies for $5 million at 500K each, instead of 1 movie at $10 million”.

    Do we really want all movies to become ultra-low-budget movies? Really? Do we not want films like Lord of The Rings made? I for one, am glad big blockbuster movies get made (the good ones, anyway: LOTR, The Matrix, The Dark Knight)– these films can be just as artistically rich as the small films.

  11. GB said, on March 29, 2009 at 8:53 pm

    I agree with nharlan and Jeffrey..to a degree. Like Jeffrey, I’ve done over 100 shorts, features, spots, docs, etc. 3 kids, wife, and college tuition for my kids right around the corner. All my work in the past was for clients with all people involved compensated for their work and nothing on the back end. From micro-budget (when working alone) to regular budget docs to low budget features.

    Currently, I’m making my own animated feature. With animation there is no cutting corners down to the microbudget level. We have 10 people on staff full time (with 100% healthcare) and 4 others part time plus a host of high school and college interns.

    We have cast and crew that have Academy Awards and Grammys under their belt and we can still squeeze that into a $2.5 million budget.

    Some of our crew worked on LOTR, The Matrix, and The Dark Knight and have said they are much happier working on our film because of the artistic potentials and their ability personally to add to the creative process. Most of these folks feel constrained by the rigid production process of the big budget films.

    Granted I’d love to have $5 million and double my staff, but I don’t see the need to blow up large buildings and cars for real, hire cast that costs $5-20 million per role, and serve lobster bisque at lunch.

    Filmmaking from Melies onward has been about illusion and metaphor. This is part of the artistry. Often these big budget films take a chainsaw when only a scalpel is needed. They have a cast of extras 500 deep when a more artistic creative mind can make 50 people look as populous. They choose to build a set when a location “as is” will do or try to remake a whole location when building a small set and using cutaways will create the same effect. This is the craft of filmmaking. I do appreciate the finery created by art directors gone wild with big budgets, but for the most part, the window dressing is not what makes a film great.

    These $100 million plus films IMHO distort the filmmaking process and ultimately our audiences who then expect only people as beautiful and well known as Brad Pitt and Angelina Jolie driving expensive, soon to be totaled, cars fast through countless explosions framed by cameras from helicopters and cranes. They distort the distribution network which currently works best when $20-60 million is spent on marketing for the opening weekend blockbuster. And for me, these macro-budget films seem obscene in a world where such large quantities of money for ONE film could be used to build numerous hospitals and alleviate so much real grief…not just entertain.

    On the other hand, outside of the student film, micro-budgets and often low-budgets are films that have either consciously or unconsciously exploited the subject, talent or crew.

    I know plenty of horror movies that got their crew and/or talent for next to nothing and then when the money came in from distribution the director/producers took it all. And who can forget that the child stars of Slumdog Millionaire were still living in the slums when the film was finished. Documentaries are sometimes the worse of the unconscious exploitation. They throw the suffering of people on the big screen and directors/producers are compensated both financially and socially for bringing the issue to light while the subjects still are suffering far from the spotlights.

    I salute all filmmakers that are just trying to make a living making their art. I lay kudos on filmmakers that are working to make their communities (both production and living) better places with sustainable livelihoods.

    Sorry for the rant

  12. […] Charting The Wrong Course Through Digital Waters by The 401st Blow […]


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