[opendtv] Streaming release of 'The Interview' test for industry | Fox News

From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
Date: Thu, 25 Dec 2014 17:02:24 -0500

http://www.foxnews.com/entertainment/2014/12/25/streaming-release-interview-test-for-industry/?intcmp=features

Streaming release of 'The Interview' test for industry

ATLANTA – Sony's "The Interview" has been a hacking target, a punchline and a
political lightning rod. Now, with its release online at the same time it
debuts in theaters, it has a new role: a test for a new kind of movie release.

"The Interview" stars Seth Rogen and James Franco as journalists tasked by the
CIA with killing North Korean leader Kim Jong Un. Its Christmas Day release was
canceled by Sony after threats of violence by hackers linked to North Korea.
But after an outcry, the release was reinstated in some independent theaters
and now, through a few online video services.

Although the circumstances surrounding "The Interview" are unprecedented,
experts say the release will be closely watched to see how moviegoers and
theater chains react to a simultaneous debut. It's a challenge to the
longstanding practice of "windowing" -- opening a movie first in theaters to
maximize box-office revenue before making the movie available in other stages
of home video, streaming and television.

"I can't say that this is the future," said Jeff Bock, senior box office
analyst for Exhibitor Relations Co. "For this film, in particular, it works
because of the saga that goes along with it. But it's nice to have a film we
can actually use as a guinea pig for a video-on-demand release."

Sony released "The Interview" Wednesday on a variety of digital platforms --
Google Play, YouTube Movies, Microsoft's Xbox Video and a separate Sony
website. It costs $5.99 to rent for 48 hours and $14.99 to purchase. It also
will open in more than 300 smaller theaters on Thursday, though major chains
are still holding out.

Carrying "The Interview" marks another step in Google's efforts to establish
YouTube as an entertainment hub that features major movies and trendy musical
videos -- not just cute clips of kitties. Google, though, said it is providing
outlets for the movie because it wants to safeguard free speech.

Decisions by Google and Microsoft to show the movie could open their sites to
hacking. Microsoft reported technical problems with its Xbox sign-in system
Wednesday, though it wasn't known whether it was the result of hacking.
Microsoft services appeared back to normal by Wednesday night. Microsoft
declined comment.

Online availability of "The Interview" comes as more people are choosing to
stream video online, largely because of YouTube, Hulu and Netflix, which has
been phasing out its original DVD-by-mail business over the past four years.
During that time, the number of Netflix subscribers in the U.S. has nearly
doubled to about 40 million in a reflection of Internet video's growing
popularity.

Nonetheless, releasing a major motion picture in theaters and online
simultaneously -- known as a "day-and-date" release -- has never been done by a
major studio with a mainstream movie like "The Interview." It's been limited to
some smaller indie and foreign movies. The upcoming "Crouching Tiger, Hidden
Dragon" sequel will be released on Netflix and Imax theaters on the same day,
but that isn't a studio production, despite the involvement of the Weinstein Co.

Theater chains have been trying to preserve the traditional theatrical window.
Regal Cinemas and Cinemark, for example, declined to screen Warner Bros.'
day-and-date release "Veronica Mars" earlier this year. Warner Bros. instead
rented from AMC Theaters most of the 270 screens the movie played in while it
was also released on VOD.

This time, however, the four major theater chains can't really object, analysts
said, as they all declined to show "The Interview," leaving Sony little choice.

"This isn't being done because Sony wants to do it regularly, but rather out of
necessity prompted by the exhibitor boycott," Wedbush Securities analyst
Michael Pachter said. "The only guys showing it are independent chains."

With a modest budget of about $40 million, "The Interview" had been predicted
to gross about $30 million in its opening weekend. Bock estimates Sony could
gross just a fraction of that -- $3 million to $4 million -- at this box office
this weekend. As for streaming, Bock said the $5.99 price for rental is much
lower than regular theater tickets, and that could drive demand. But Sony isn't
likely to make up all of its costs, including the tens of millions in marketing
costs already incurred.

A best-case scenario for a video-on-demand release is the thriller
"Snowpiercer," which debuted on video on demand about two weeks after its
theatrical release. It made nearly $11 million on VOD, more than double its
theatrical revenue, and is considered one of the most successful VOD releases
so far.

If "The Interview" agreement is similar to other digital video deals, Google
and Microsoft will get a 30 percent commission on all rentals and purchases of
the movies made through their services. Yet even if the movie were to be wildly
successful and generate $100 million in video-on-demand revenue, that would
leave about $30 million for Google and Microsoft to divide -- hardly anything
for two of the world's most profitable companies. For instance, Google is
expected to bring in revenue of about $66 billion this year, or about $30
million every four hours.

By including "The Interview" in their libraries, both YouTube and Microsoft's
Xbox can also make more people aware they rent and sell a wide range of videos.
Although YouTube began renting movies nearly five years ago, many people think
of the site as a destination for free clips lasting for a few minutes instead
of place to watch full-length films.

Gitesh Pandya, editor of Box Office Guru, said all the media attention should
lead to "strong averages from the limited theatrical release plus solid
video-on-demand sales" over the holidays, but he expects demand to fade in
January because of the quality of the movie.

"It is great that a freedom of speech debate is happening for Hollywood films,"
he said. "I just wish it was centered around a better movie," he said.e," he
said.

[opendtv] Streaming release of 'The Interview' test for industry | Fox News

Other related posts: