The Distribution Beat

Peter Broderick, president of Paradigm Consulting

Now that 2010 is here, the facts are in about movie-going in 2009. According to a recent report from Adams Media Research, last year was the first year since 2002 that Americans spent more money buying tickets at the box office than they did buying movies for home viewing.

Theatrical receipts totaled more than $9.87 billion in 2009, which is 10 percent more than 2008's box-office take. The DVD/Blu-ray market took a nose dive in 2009 (despite the rising popularity of Blu-ray Discs), falling 13 percent from the year before down to $8.73 billion.

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The popularity of movies showing in 3D and IMAX theaters (which charge anywhere from $2 to $5 more for the same movie) contributed heavily to movie grosses, while the proliferation of online streaming video contributed to DVD's waning popularity.

In November 2009, Nielsen compared October 2009 to October 2008 and concluded: "Year-over-year, unique viewers, total streams, streams per viewer and time per viewer were up, led by a 26 percent growth in total streams." In November, growth was up 17 percent from 2008, and growth was up 13 percent in December.

With movies being spread across so many mediums and the numbers fluctuating so rapidly from year to year, one distribution method for independent filmmakers that is being touted by strategist Peter Broderick, president of Paradigm Consulting, is hybrid distribution.

As its name suggests, hybrid distribution includes several things. On the direct side, it combines direct DVD sales at theatrical screenings with digital streams, downloads, and DVD sales on the filmmaker's website. Sales can also funnel through several distribution partners such as retail DVD distributors, educational distributors, video-on-demand (VOD) companies, and TV channels.

In the past, turning over complete distribution rights to one studio was the norm, but according to industry veteran Broderick, that is changing.

"It's not difficult to split the rights unless you're making deals with major studios," he says. "For example, most DVD distributors will let filmmakers sell DVDs directly from their websites at the same time that the distributor is selling them in retail outlets. These days, for many filmmakers, splitting rights is Plan A and making an all-rights deal is Plan B."

Distribution partners will have differing ways of doing business, however, and it is important to understand the distinctions between VOD, TV, and Internet rights.

"Generally, Internet rights are non-exclusive—you can be on iTunes, Amazon Unbox, etc.," Broderick says. "VOD, [however,] is exclusive, as is TV."