Lionsgate Touts Expanding Home Entertainment Distribution16 Jan, 2017 By: Erik Gruenwedel
Studio/distributor equals Disney with No. 4 market share
With the acquisition of Starz, Lionsgate now ties Disney as the No. 4 home entertainment distributor with 12% market share, Jim Packer, president of worldwide TV and digital distribution, recently told an investor group.
Speaking Jan. 10 at Lionsgate’s inaugural investor day in Denver, Packer said the market status should result in increased opportunities with vendors, platforms and retailers.
Indeed, home entertainment revenue from proprietary motion picture and TV production alone increased to $160.7 million in the most-recent fiscal period.
“We achieved this market share … by being a trusted distribution partner,” Packer said.
The executive reiterated the acquisition, which included Anchor Bay Home Entertainment, results in a unified distribution company encompassing digital, physical and television.
“This centralized structure eliminates any internal conflict and allows us to adapt to a changing market place very, very quickly,” he said.
Lionsgate aims to fill the evolving distribution pipeline with library content that generates more than $300 million in annual revenue. A portfolio consisting of 16,000 movies and TV shows via proprietary channels and third-party partners, including Amazon Studios, A24, The Weinstein Co., CBS Films, Miramax and Participant Media, among others.
Lionsgate will distribute eight of the Top 10 Best Picture nominees from the recent Golden Globes, including two from its Summit Entertainment subsidiary.
Steve Beeks, co-COO and co-president of the motion picture group, said home entertainment revenue helps underwrite a “substantial” portion of company overhead costs.
“Over the past several years, we’ve leaned heavily into the library business. Even before all these [distribution] platforms began to proliferate, we felt we could see it coming. All the other studios were slacking their interest [in library],” he said.
Beeks said home entertainment, in an age of streaming video, remains “often overlooked,” despite being a stable contributor of long-term revenue.
“Third-party content is relatively low-risk and not related to our primary theatrical business … with return-on-investment [ROI] over 45%.”
With Starz, Lionsgate adds the premium pay network serving nearly 25 million subscribers and the Starz Encore platform with more than 31 million subs. The combined company operates five over-the-top (OTT) streaming services, in addition to the Starz app delivering content directly to consumers.
Packer said Starz translates into 600 seasons of content being distributed, including 3,700 individual episodes directly in 190 countries.
“Our team has seven offices around the globe. We do it in a coordinated way to maximize growth. Based on historical levels, we would expect to be managing over a $1 billion in any given fiscal [year],” he said.