Oh, All the OTT!

The media business is abuzz with talk of OTT (over-the-top distribution via the Web). Not since DVD has a three-letter distribution format garnered so much attention in the industry.

Chase Carey at Fox said his studio is going to be careful to control it, making sure to preserve the profitability of the legacy business while cultivating a marketplace with many players ¬— and customers to which the studio can sell its valuable content. Bob Iger at Disney said the “Star Wars” and Marvel properties might make marvelous online channels, and that the Disney brand itself is also perfect for OTT.

The major studios aren’t the only players in the OTT game. Dish Network’s Sling TV, fresh off the announce of its launch at the Consumer Electronics Show, added Univision content to its lineup, which also includes ESPN. Shout Factory announced the launch of its catalog of cult TV and movies OTT with an ad-supported service.

And then of course there are OTT heavyweights Netflix and Amazon Prime, which are both basking in the glow of awards season, with their original content earning numerous plaudits.

The growing marketplace is reminiscent of the early days of cable, when the TV channel choices suddenly multiplied from the original three broadcast networks. But this is channel multiplication on steroids, with almost limitless possibilities. Finding the consumer in the cacophony of competitors will grow ever more difficult. Conversely, with an almost limitless amount of content at their fingertips, consumers may not be able to find or discover exactly what they really want to watch, distracted instead by what they stumble upon.

How will a revolutionary indie film be discovered or produced? What profit stream will finance high-quality product?

I applaud services Netflix and Amazon Prime for getting into the content game rather than just distributing others’ content. Granted, both services see it as necessary for self-preservation on the Web, where the barriers to competition are low. But the services also are committed to quality, which is laudable when much of the “content” on the Internet is amateur-produced distraction — makeup tips, gags and gimmicks. Like fast food supersizing, more isn’t always better in the content realm either.

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The Digital Wild West

“It’s the Wild West,” a top digital executive told me during the Consumer Electronics Show as we discussed what was happening both domestically and abroad with content distribution. Recently, the digital shootout with traditional Hollywood has resulted in more broken windows and online series lassoing some of the industry’s top awards.

Amazon has followed Netflix into the theatrical realm through its Amazon Original Movies, planning to produce and acquire original films for theatrical release (and release on Amazon Prime Instant Video subscription video-on-demand four to eight weeks later). Netflix made its own deal with The Weinstein Co. to debut the Crouching Tiger, Hidden Dragon follow-up simultaneously in theaters and via streaming. Amazon has inked a deal with legendary filmmaker Woody Allen, Netflix with Adam Sandler. Both Sandler and Allen previously had been theatrical heavyweights.

Sony’s The Interview, plagued by controversy after terrorists threatened harm, hit the VOD market early, stepping on the theatrical window, and will be released on Netflix before its traditional window on disc.

Meanwhile, among the Golden Globe nominees and winners were several from Netflix and Amazon original series. Amazon Prime's critically lauded "Transparent," a comedy starring Jeffrey Tambor as a family's transgendered patriarch, won two major awards — Best TV Comedy or Musical Series and Best Actor for Tambor —a first for Amazon. Netflix’s “House of Cards” earned a Best Actor in a TV Drama trophy for Kevin Spacey.

Exercise programming started with home video — Jane Austen in fact got her start in exercise videos with our magazine’s founder Stuart Karl — but is now moving further into SVOD. Comcast Cable and Gaiam have unveiled Gaiam TV Fit & Yoga, a subscription-based video-on-demand service enabling Xfinity TV subscribers access to yoga and fitness training. Lionsgate is planning its own fitness SVOD service under the BeFit brand, which has more than 1.3 million subscribers to its ad-supported YouTube channel.

If this were a poker game to dominate Hollywood in an Old West saloon, there would be a lot of deck shuffling. And, to really push this Western metaphor, the real question is: “Is there gold in them thar hills?” Will digital models ever be able to rival the kind of money that Hollywood has earned with the traditional window system? Or will the digital players get a bigger part of a shrinking pot? So far, indications are fuzzy.

The release of The Interview — which is an unprecedented case — has earned plaudits for its revenue on VOD, but I’m fairly sure the traditional release schedule would have generated more profit. We will never know, but those who say this Hollywood Western is in the final showdown are wrong. I think we have only seen the first few scenes.

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3D Eclipsed by 4K

One overwhelming trend at the Consumer Electronics Show in Las Vegas, at least for the home entertainment industry, was the shift to 4K, a resolution standard that promises roughly four times what HD can offer.

And yet, just a few years ago, the number three — as in 3D —was everywhere on the show floor. This year 3D was hard to find in the TV-heavy Central Hall of the Las Vegas Convention Center, while 4K (or its other moniker, Ultra-HD) was plastered on all the big booths, from LG to Sony.

In a very interesting panel put on by our colleagues at , and moderated by its editor, Daniel Frankel, representatives from Comcast Cable, Samsung Electronics Smart TV Services, Qualcomm, MLB Advanced Media and Arris pondered the shift to 4K. Notably, they addressed the squelched 3D push, as well as format ghosts, such as (from the not so distant past) HD DVD. They said 4K stood a better chance of adoption, if only because the hardware will be everywhere at a consumer-friendly price. Pretty soon, every new TV will be 4K whether consumers desire it or not. And then, they said, the content will come, pushed by OTT (over the top) services such as Netflix.

The transition is inevitable, but is it truly a step forward? Can the human eye really see the difference of the higher resolution, especially on small screens such as cell phones? Panelists noted that the difference in visual quality isn’t just the higher resolution, but the more vivid color and sound quality. Also, 4K allows for a more complex graphics presentation. One panelist noted that, as with HD versus standard-definition, "It's one of those things that once you see it, you can never go back."

That may well be, but I reminisced on the show floor by trying to find good old 3D, especially without those pesky glasses, which I think proved to be the format’s downfall. And — low and behold — I finally saw a presentation, from Stream TV Networks that presented glasses-free 3D that didn’t make me sick and looked pretty good from different angles. They can even upconvert classics such as It’s a Wonderful Life. It’s just too bad that 3D technology, which finally seems to be overcoming those glasses, is a day late and a digit short.

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Controversy a Roadblock to Release

The Interview

The damaging cyber attack against Sony Pictures, which most speculate North Korean hackers launched as punishment for production of the film The Interview, may have put the comedy in the can permanently. Originally scheduled for theatrical release Christmas day, The Interview, about reporters attempting to assassinate North Korean leader Kim Jong-un, may never officially see the light of day, even on home video. Sony pulled the theatrical launch after threats to movie theaters, and the home video release is up in the air.

While the situation is unprecedented, it will not be the first big studio title to never get an official release in the U.S. home entertainment market. Home entertainment fans have long clamored to see Disney’s Song of the South, based on the Uncle Remus stories and featuring the Academy Award-winning song “Zip-a-Dee-Doo-Dah,” but it has never been released officially on home video in its entirety in the United States. The 1946 musical’s subject matter, which has not aged well in these enlightened times and which many find racist, has kept that film off cassette and disc (at least officially). Certain other countries and pirates have released the title, but U.S. fans may only see it in snippets on other home entertainment releases, such as the Brer Rabbit animated segments, which are the basis for Disneyland’s Splash Mountain attraction.

Other content with touchy subject matter, racist or otherwise, from the early days of film and cartoons is also stuck in the vault and has not been released on home video.

While The Interview is quite different from Song of the South, controversy haunts both. A terrible controversy such as the one facing Sony seems to be a very damaging wound that could kill a film’s video release. Studios are backers of the First Amendment — to a point. Studios are corporations, with responsibilities to stockholders, business partners and their own employees, whose private emails and other information have leaked for everyone to see. The legal heat may prove too searing for a studio that could be blamed for basically any attack associated with the film, cyber or otherwise.

Still, that doesn’t mean viewers will never see The Interview. Like Song of the South, The Interview will likely be bootlegged. Already, pirated scenes are leaking out on the Web, and, likely, hackers will beat Sony’s attackers at their own game and disseminate a copy online. But, officially, a home entertainment release may have hit a permanent roadblock, meaning Sony will take another hit and so will free speech.

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Women and Wisdom

Dec. 3 I attended a wonderful and informative holiday event sponsored by the Canon Club, held by DEG: the Digital Entertainment Group and hosted by Deloitte at The Peninsula Beverly Hills. 

The DEG created the forum, "Canon Club: Where Women in Home Entertainment Meet," for women in home entertainment to come together to learn, share and engage, and the holiday event certainly delivered on that promise.

The event’s featured speaker, Madeline Di Nonno, CEO of the Geena Davis Institute on Gender in Media, offered some compelling statistics on the state of female representation in the media, both domestically and internationally ().

Di Nonno told the assembly progress has been very slow. As the study says of the United States, “Research reveals that the percentage of female speaking characters in top-grossing movies has not meaningfully changed in roughly a half of a century.”

The focus on women in media seems to be on their physical attributes.

“Female characters just can’t escape an emphasis on appearance,” she said, adding that females 13-39 are “equally sexualized.”

Still, some progress has been made. The Institute has been able to get more female characters included, if only in the background on various animated films. But it’s hard to get Hollywood to change the mindset that men won’t go to female-driven films, while women will go to male-centered films. With regard to that, I think Di Nonno made a great point, saying that if female characters are written compellingly, both men and women will flock to content. Case in point: Disney’s Frozen.

“Boys loved Frozen,” she said.

And girls loved it, too, for its strong female characters. “I want the sparkle, but I want the Jedi thing,” Di Nonno said of the Institute’s research on the attitude of today’s young girls.

Perhaps it’s not so much that consumers don’t flock to see female-oriented films as it is that they want to see well-written female characters, characters as well-written as the male ones. And that will probably require more female involvement in the writing, producing and directing of content.

I commend Di Nonno and the Geena Davis Institute for tackling this problem, and I think the Institute’s research and outreach is important to Hollywood as it looks to attract consumers with stories that are new and effectively target more than half the population. I think progress will be both rewarding for women and profitable for the industry.

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Honoring Women

I am so delighted every year to publish this issue honoring the top women in home entertainment. I have two young girls, and I am always encouraged by the accomplishments of the women in our industry, as they are blazing the trail.

These women are forging the path to a new entertainment ecosystem, in which digital delivery is an ever-growing branch. Kelley Avery has been key to DreamWorks Animation’s moves on the Netflix platform. Disney’s Janice Marinelli has spearheaded the cloud-based Disney Movies Anywhere platform. Mary Daily is using her marketing expertise to tap social media. And Lexine Wong is expanding movie extras into the digital realm with Walmart’s Vudu Extras+ for UltraViolet titles.

These women, along with their distinguished teams, are at the forefront of devising a strategy to deliver digital entertainment in the home, while managing a still important physical disc business that continues to bring in revenue for their respective studios. Meanwhile, women at independent content operations are helping to develop delivery of documentaries, independent films and quality television product. On the retail and digital distribution front, women play key roles at Walmart, Redbox, Netflix and Comcast, getting content to the consumer in many different ways.

On this occasion, I would also like to honor another woman in this industry who, after 23 years at Warner Bros., is retiring — Ronnee Sass. Ronnee is one of those rare publicists in the entertainment business who is unfailingly kind and generous, while also being effective at her job. Warner Home Video executive Jeff Baker couldn’t have said it better: “This individual is — and I can speak from first hand knowledge because I’ve had the pleasure of working alongside Ronne Sass for 12 years that I’ve been here — this individual is the best publicist in the history of the home entertainment business. She had a remarkable career here, and she is going to be missed.”

Yes, she will.

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'Frozen' Sing-Along Spotlights Cool Songs

If you have daughters (I have two) or noticed a particularly popular Disney princess costume this Halloween (Elsa), you probably know Frozen is one of the hottest properties for girls.

“I saw about six Elsas,” noted my 16-year-old, who “volunteered” (with a little push) to escort the younger kids around the neighborhood Oct. 31.
Even before Frozen won Oscars for Best Animated Feature and for Best Original Song for “Let It Go,” the tide of praise from the pint-sized set had been building — and they had been singing the songs. In addition to award-winning music and lyrics, what also makes Frozen’s songs so hot is that they are easy to sing. In addition to “Let It Go,” the film includes such hits as “Do You Want to Build a Snowman,” “Love Is an Open Door” and “For the First Time in Forever.”

My girls know the tunes by heart, but often stumble over the lyrics. That’s why Walt Disney Studios’ all-new, full-length Frozen Sing-Along Edition, coming Nov. 18 on DVD and Digital HD and Disney Movies Anywhere, will satisfy many a budding singer. They’ll be able to follow the lyrics with a bouncing snowflake to sing along with Elsa (Idina Menzel), Anna (Kristen Bell), the goofy snowman Olaf and the other characters. In addition to sing-along and original theatrical versions of the film, the release also includes an all-new extra “Breaking the Ice” and the Mickey Mouse short “Get a Horse!” The Frozen sing-along will likely light up the holidays for many families, as adults patiently, but happily, listen to their kids’ rendition of “Let It Go” for the umpteenth time.

As a parent of two girls who really like to sing, I appreciate the fact that the tunes in Frozen offer an empowering message. It’s also what attracted my daughters to the film, about two sisters who must overcome a dangerous gift and plotting prince to save their kingdom and themselves. As much as they identified with the sisters’ tendency to annoy each other, my daughters also liked the loving relationship between the siblings that drives the plot.

Predictably, my youngest said, “A lot of younger siblings can relate to it, because the older sibling is shutting you out.”

The older one saw common ground in  “the idea of everyone expecting something from you.”

Of the climax of the film, “I liked how instead of a kiss from a boy, it was a hug from a sister,” said my youngest (and sweetest) — and the older one admitted she liked the whole sisterly love thing, too.

Aah … it warms a mother’s heart.
 

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Taylor Swift in Tune With the Studios

The music business has long mirrored the video industry, facing many of the same challenges. Singer Taylor Swift, fresh off the launch of her latest blockbuster album, 1989, recently pulled her catalog from subscription streaming service Spotify, saying artists and their labels aren’t paid enough for the many times listeners stream their songs.

“Valuable things should be paid for. It’s my opinion that music should not be free, and my prediction is that individual artists and their labels will someday decide what an album’s price point is,” she wrote in a column in The Wall Street Journal.

Ah, it’s sounds so familiar to those of us in the home video business. The studios have been making the same accusation against subscription service Netflix and kiosk vendor Redbox — that they devalue entertainment. And several studios, too, have limited access to top entertainment on those services.

Unfortunately, consumers also help determine the value of entertainment, and since the advent of the great recession, they have flocked to the cheapest venues, some of them, such as YouTube or pirate sites, offering free entertainment. Low price has driven the rise of Netflix and Redbox, as much as innovative distribution models. For consumers squeezed by lower wages, the value of entertainment is heading downward. After Netflix raised prices to new subscribers, their growth slowed domestically in the last quarter. Redbox’s attempt to do the same could end badly, analysts have opined. Both are treading carefully, testing the waters.

Artists such as Swift may have the popular muscle to get fans to pay more by buying her album instead of streaming it through Spotify. But U2, one of the biggest bands in the world, recently took a different tack, offering their album at no charge on iTunes.

Here’s hoping that Swift has some effect on raising the value of entertainment. If there were a large supply of free diamonds or diamonds at little cost, no matter how beautiful they were, they too would lose their value. It’s high time we value the talent that produces our music, films and other artistic content. They work hard on their art, and not to pay them for it seems, well, out of tune with the idea of the American work ethic.

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Subscription Fever Could Break

Recent news is awash with content owners and producers breaking the cable cord and following the Netflix model of online subscription streaming. Companies such as HBO, CBS and Lionsgate are looking to the Web to create a new avenue to the consumer.

It is particularly interesting that both a broadcast network, CBS, and a major cable network, HBO, are looking to the Web to capture viewers. They represent the entrenched establishment of television programming. Both CBS and HBO have made fortunes via the traditional cable and broadcast route.

CBS Corp. Oct. 16 announced the launch of “CBS All Access,” a $5.99-per-month standalone subscription streaming service that doesn’t require a concurrent pay-TV subscription. That came on the heels of an announcement to an investor group by HBO’s Richard Plepler that the company will launch a standalone over-the-top video service not requiring a cable/satellite/telecom subscription (as opposed to the current HBO Go service) in the United States in 2015. It all makes me think of the World Wrestling Entertainment announcement at the Consumer Electronics Show last January. The wrestling company unveiled a grand plan to go directly to its consumers via a 24-hour streaming network, with a $9.99 a month subscription offering live PPV events, reality shows, original shows, documentaries, classic matches and more than 1,500 hours of VOD programming.

My question is what does this all add up to for the average consumer? Say I’m a wrestling fan ($9.99 a month) who wants to have access to CBS programming ($5.99 a month) with a basic Netflix subscription ($7.99 or more a month) in addition to my basic internet/cable access cost and goodness knows what other programming.

It seems to me that cord cutters may get more specific choices, but may end up paying more than what they would with your average cable package. As any restaurant customer knows, a la carte menu items often end up costing more than the buffet.

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4 Types of Digital Disruption

Digital changes are shaking the industry like earthquakes, and I see at least four major disruptions facing the home entertainment industry.

1. Breaking windows — After taking on appointment TV by offering original episodic programming all at once (“House of Cards,” “Orange Is the New Black”), Netflix is planning to offer digitally for streaming feature film product traditionally offered first at the cineplex. The Weinstein Co. inked a deal with the online service to release the Crouching Tiger, Hidden Dragon prequel to Netflix streaming subscribers at the same time it hits theaters. Also, Adam Sandler, a longtime draw at the movie theater, signed a deal to bypass that venue and offer his uniquely crude humor on smaller screens via Netflix streaming.

2. Business model bustup — As has long been noted, the revenue model that has underpinned the entire Hollywood ecosystem is under assault. The theatrical business looks shaky. The summer box office disappointed, as consumers found other things to do (including watching digital content). Meanwhile, studios can no longer count on bigger and bigger, or even the same, bags of money coming from the sale of discs as consumers decide to stream rather than buy their content. Meanwhile, advertising upfronts are taking a hit in the TV business as time-shifting and social media disrupt the traditional advertising model.

3. Talent revolt — Those who create content are looking for a bigger piece of the revenue pie and greater creative freedom as the distribution model shifts. Sandler isn’t the only star looking to find a new partner in the digital world. Comedian Chelsea Handler broke up with E! and is looking to create the next form of talk show in the digital realm on Netflix. It’s happening in the music arena as well. According to a report in the Los Angeles Times, at a recent industry event musician Jimmy Buffet asked the CEO of the music streaming service Spotify if he would pay talent more than the traditional labels.

4. Entertainment in new forms — And there’s the possibility that the entertainment of the future won’t resemble the feature film and episodic TV model of the past. What makes 30-minute or hour-long episodic TV or a roughly two hour film the most popular models for visual entertainment? Until now, that kind of entertainment has been shaped by the distribution model, i.e. how long folks can stand to sit in a theater seat, etc. On the web, small-bite entertainment may play a bigger part. Witness the success of sketch comedy online. Also part of the new entertainment model: watching folks play and comment on video games. Witness the outlandish success of Twitch, worth nearly a billion dollars to buyer Amazon.

Yes, the entertainment ground is shifting.

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