Panel, Conference Presentation
Hollywood's Pursuit of the Digital Dollar
- The digital dollar is currently driving strategic decisions regarding content, distribution, acquisitions, and financing rather than being viewed solely as a future trend.
- Lionsgate anticipates securing direct digital agreements with major cable operators including DirecTV, Comcast, Cablevision, AT&T, and Verizon.
- Digital distribution is projected to exceed 50% of the U.S. home entertainment market within two years and internationally within 2.5 to three years.
- YouTube is expected to serve as a testing ground for leveraging Marvel's 8,000 characters and Lucasfilm's 17,000 to 18,000 characters.
- Lower-cost digital production and YouTube distribution are predicted to create significant opportunities for monetization as more entities create and distribute content.
- Netflix plans to allocate 20% of its total content spend toward original programming.
- The shift toward "originals only exclusive content walled worlds" raises concerns regarding the cannibalization of back-end revenues and profitability in a lower-margin environment.
- Industry participants expect shorter release windows and increased prominence in the non-exclusive space as deep-pocketed digital players emerge.
- The independent sector is forecasted to continue shrinking as established entities acquire new iterations, potentially reducing entrepreneurial opportunities and alternative voices.
- Integration of new technologies aims to generate incremental usage occasions and improve fundamental economics for the industry.
- Most Favored Nation clauses currently restrict the ability to offer region-specific pricing variations, such as for the East Coast during snow events, within the VOD marketplace.
- "Binge viewing" is anticipated to remain a permanent consumer preference due to the demand for content availability without appointment viewing constraints.
- The advertising model is expected to evolve toward a phase where brands leverage binge viewing and time-shifting to reward advertisers rather than fearing them.
- Native advertising and branded content are predicted to become a major component of the online landscape, with major marketers like Procter & Gamble revisiting models like the soap opera.
- Shifts in market capitalization and the need for pricing flexibility are driving marriages or engagements between content creators and distributors on the digital front.