Why Hollywood Can’t Ignore Digital Distribution

/ Aug 27, 2014

US_OnlineVideo

Ignore, for a second, about how more and more producers are creating content for digital platforms. Hollywood studios and networks — those still generating most of their revenue from traditional films and TV shows — are also increasingly adapting to digital, because they have to.

If you need just one statistic to explain why, how’s this: Revenues from US subscription VOD streaming services like Netflix and Amazon topped $1.9 billion in the first half of 2014, representing a 26.17% increase from the previous year. Revenues from electronic sell-through services like iTunes totaled $671 million, growing 36.84% since 2013.

emarketer digital distributionThese numbers (and the chart) are courtesy of eMarketer, which pulled data from a report released by the Digital Entertainment Group earlier this month.

By itself, the data shouldn’t be surprising. Netflix has been reporting higher subscriber and revenue numbers for quite some time now, because consumers are increasingly flocking to digital services to discover or rewatch films and TV shows.

What makes all this more compelling, though, is how digital compares to the more traditional means of distributing and redistributing content. According to Digital Entertainment Group, SVOD and EST were the only two formats to see a positive change in revenue from the previous year. Brick and mortar? Down 32.68%. Rental excluding video-on-demand? Down 14.55%. Rental with VOD included? Negative 11.4%. Traditional VOD by itself? Minus 5.63%.

This is why you’re seeing initiatives like the UltraViolet digital locker service, or TV’s attempt at “TV Everywhere,” or studios experimenting with multi-platform release models for some films.

Interestingly enough, this is also why content costs continue to rise for digital outlets like Netflix and Amazon, and why both have, as a result, ventured into creating original programming.

More and more people are watching movies and TV shows. But less and less are interested in always watching this content the way they historically have. It’s one of the reasons why box-office numbers have been down this summer, and why the 2014 upfront market was pretty weak.

Give viewers what they want when they want it — it’s a popular refrain in the industry, but as the numbers are beginning to reflect, it’s also true.

Tags: , , , , , ,


Instant Time INc.

Time Inc.’s ‘New Famous’ Platform Instant...

 
Susan Wojcicki YouTube

Take That, Facebook: YouTube Adding Mobile Live Streaming

 
YouTubeRedLogo

YouTube Red Sticking with Influencers

 
VidCon YouTube Intimacy Problem

Do YouTubers Have an Intimacy Problem?

 
Industry Tickets Selling Fast!
Click above to lock in your registration for VidCon 2015!
 
JensChristensen_JauntVR_VideoInk_300x250

VidCon 2016: 5Qs With Keynote Speaker Jens Christensen

 
Zefr Top 100 Influencers

Zefr Calculates 100 Top Digital Influencers

 
VH1 What's Trending Huge on the Tube

Can “What’s Trending” Transform Itself into E!...

 
BrandFlirt_VideoInk_300x250

Good Amplified Teams with Internet Famous Database to Match...

 
BuzzFeed is number one for views across social video platforms in may

Ze Frank’s Memo May Have Just Opened the Biggest Can of IP...

 
Alice Ng uFluencer Group

uFluencer Group Taps Alice Ng to Head Talent in Asia-Pacific Region

 
Internet Famous Shane Dawson

If YouTubers Relate to ‘Internet Famous,’ They Need...

 
Rooster Teeth Lazer Team

Rooster Teeth’s “Lazer Team” Grabs...

 
VidCon

VidCon Going Global in 2017 with Events in Australia and Amsterdam

 
Superfruit

Fullscreen Signs Five Creators, incl. Superfruit, Ricegum and...

 
Star Wars Force Friday Unboxing Maker Studios

How Toy Manufacturers Make Streaming Video the Gift That Keeps...

 
Art of More Dennis Quaid Crackle

Crackle’s ‘The Art of More’ Adds Merritt...

 
Sable_Musurca_VideoInk_300x250

Gunpowder & Sky Set to Develop Skate-Themed Thriller from...

 
Alias Grace Netflix

Margaret Atwood’s ‘Alias Grace’ Gets...

 
Oberto_WorldsFirst_VideoInk_300x250

Jerky Brand Oberto Makes Sports Play in Video Series with Nitro Circus

 
Melvin Gregg CAA

Actor/Vine Star Melvin Gregg Signs with CAA

 
insurrection logo

Verizon Hearst Media Partners’ Seriously.TV Orders First...

 
Sports Illustrated

Sports Illustrated Adds Emmy-Winner Josh Oshinsky to Digital Team

 
Machinima Logo

Machinima Goes Over-the-Top in Spain and Portual with AMC...

 
Christina Grimmie and Dog Chloe

Christina Grimmie On Giving Back: ‘You Shouldn’t...

 
E3

E3 Is A Showcase For Of Branded Content in All Its Variations

 
@SummerBreak Season 4

Transmedia Reality Series ‘@SummerBreak’ Gets Season...

 
Culver Studios River Studios

Virtual Reality Start-Up River Studios Opens L.A Operation

 
Vimeo

Vimeo Wins Round in Copyright Battle with EMI

 
David Brent Life on the Road Ricky Gervais Netflix

Netflix Stays in Ricky Gervais Business with ‘David Brent:...

 
TheStreet

TheStreet Rolls Out Blue Chip In-House Branded Content Studio

 
Sports Illustrated Tech & Media Time Inc.

Time Inc. Launches Sports Illustrated Tech & Media...

 
Super Deluxe Turner

Turner Officially Resurrects Super Deluxe Comedy Portal

 
Felix & Paul Studios

VR Studio Felix & Paul Closes $6.8M Funding Led by Comcast

 
SupremeCourt

Why the ‘Net Neutrality’ Ruling Could Backfire on...

 
EllationVRV_VideoInk_300x250

Meet Vrv, The New Digital MSO from Otter Media’s Ellation

 
VidCon

Will VidCon’s Added Security Spoil the Party?

 
Emmys_VideoInk_300x250

2016 Emmy Voting Begins Today, Meet the Short Form Category Nominees

 
Emmys_VideoInk_300x250

2016 Short Form Emmy Contenders – Variety Series

 
Emmys_VideoInk_300x250

2016 Short Form Emmy Contenders – Non-Scripted / Reality Series

 
Emmys_VideoInk_300x250

2016 Short Form Emmy Contenders – Comedy and Drama Series