Industry Report: Financing
Platforms key to tapping new revenue streams
- Mitch Singer, chief digital strategy officer of Sony Pictures and president of Digital Entertainment Content Ecosystem (DECE), the consortium behind UltraViolet, plans to focus on the root of the industry's fiscal issues: getting consumers to shell out money for films already produced. By Todd Longwell
"We've seen a large decline in DVD sales and revenue, and the increase in Blu-ray is not quite making up the difference," Singer says. "As we migrate to digital what we're seeing is a fairly flat revenue curve for digital sell-through, and we all know that sell-through is the main revenue for our industry. And if you get less revenue from a film, the budgets of the films are going to be smaller or studios are going to produce fewer films. We're seeing that right now. Disney used to produce 40-50 films a year with (Miramax) producing 25 of them, now they're down to 11."
Singer is betting the answer to the biz's sell-through woes is UltraViolet, a cloud-based, buy-once-and-play-anywhere plan that enables consumers to stream purchased titles to any device with a compatible app -- at the moment, the sole app is Flixster -- including TVs, gaming consoles, computers and mobile devices.
When UltraViolet first came online in January, many in the media complained that it was not ready for primetime.
UltraViolet may be a tough sell for some in the industry, too, since instead of creating revenue streams, it effectively unifies them across a variety of platforms. But as the decimation of the music industry by pirated downloads demonstrated, it's likely better than the alternative.
"We have to build something for consumers that's better than free, that gives them ease of use (and) choice," Singer says. "If we fail to solve these issues, we're going to find ourselves where the best way to get our content is through illegal channels, in which case we all lose."