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Clicking and Streaming

Home entertainment searches for its digital future

Illustrations By Deanna Staffo

By Lee Gardner | Posted 6/24/2009

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There are always people looking for something they don't have, and Mike White is one of those people. A lifelong film fan, he is the editor of the film zine Cashiers du Cinemart and an occasional contributor to City Paper-owned Metro Times in his hometown of Detroit. (He is no relation to the actor/screenwriter/director of the same name.) White has spent years amassing a huge assortment of VHS tapes, laser discs, and DVDs of his favorite movies, often illicit copies of obscure films that had never been available on home video. In the early '00s, within the network of fans and web sites devoted to such films, he began to make copies of some of his rarest items for other people.

"I had quite a collection and just tried to help folks out with finding obscure films," he says in a phone interview. "After a while it got to the point where I was sending out so many tapes that it didn't make any sense to keep doing it for free, so that's how superhappyfun.com was born."

Through superhappyfun.com, White and a partner sold DVD-Rs of hundreds of otherwise unavailable titles--everything from Japan-only films by shockmeister Takashi Miike to Change of Mind, a rare 1969 exploitation film in which a white man's brain is transplanted into a black man's body. And it turns out that it wasn't just cult-y titles that people who stopped by the site wanted. The full-length version of 1976 TV movie Sybil, starring Sally Field, proved to be a popular request, as was Follow Me, Boys!, an obscure 1966 family film starring Fred MacMurray.

Of course, a "popular" film for superhappyfun.com might sell a few hundred copies. White says the site never brought in more than "pocket money . . . it might have helped pay for [acquiring] the movies themselves." But then, unlike organized pirates who churn out thousands of shoddy copies of hot new releases, White was focused on films not profits.

"I tried to be the most ethical bootlegger I possibly could be," he says. "My whole idea was that I wanted to be put out of business, in that all of the movies that I carried were available legally and easily for folks to get their hands on. It wasn't to my chagrin that I would pull a title because it was coming on Criterion DVD, it was like, 'OK, finally. Instead of a 12th-generation copy, here it is on DVD for everyone to see.'"

White gave up his part in superhappyfun.com in 2008, in part because of a conflict with his partner, in part because of "checking the mail every day to see if I had any cease and desist orders--after a while it got to be a little too unnerving." But the trade in bootleg copies of obscure films on the web continues, with sites such as Just for the Hell of It (j4hi.com) and Shocking Videos (revengeismydestiny.com) going strong. "Business is still pretty darn good out there for folks," White says.

"Our goal is to not only put those people out of business, but hopefully in jail," says George Feltenstein, senior vice president of marketing for Warner Home Video Theatrical Catalog. It's the kind of statement you can imagine coming from an executive affiliated with one of the biggest Hollywood movie studios, which have become increasingly aggressive about bootleggers in recent years. But even Feltenstein acknowledges that "the best cure to piracy is to make the product available. It all exists because there's demand."

To that end, in March Warner Home Video launched the Warner Archive, a new retail program that has the potential to revolutionize the way studios deal with their film libraries and movie fans score copies of their undersung favorites.

For the past 23 years, Feltenstein has overseen Warner Home Video's catalog business, releasing and marketing thousands of older titles from the vaults of Warner Bros., MGM (through 1986), RKO Pictures, and other classic studio libraries -- more than 14,000 titles in all, stretching all the way back to 1914. And for the past 23 years, he's been steadily bombarded with requests for titles that haven't yet appeared on VHS or DVD. Even with what Feltenstein describes as Warner Home Video's "aggressive" mining of its catalog--which includes everything from A Charlie Brown Christmas to Zabriskie Point--there have always been people willing to pay for obscure titles that it made no financial sense to release.

"Generally, we tend to need to break even at retail at around the 20,000-unit mark," Feltenstein says. "And if a title can't make that threshold, it would make the likelihood of a retail release [very small]." Despite the rise of online vendors such as Amazon, the recent demises of stock-everything retail chains such as Tower Records and Virgin Megastore has made releasing catalog titles even tougher. "There are certain films right now that four or five years ago we would have planned to release to retail, but most of our retailers that would have carried them are no longer in business," Feltenstein says.

Cue the Warner Archive. Via the program's web page (wbshop.com/Warner-Archive/ARCHIVE,default,sc.html) consumers can now click on one of nearly 200 titles and counting from the Warner Home Video library and buy a DVD copy of the film, individually burned and packaged in a standard DVD keep case with printed cover art. While Feltenstein might find it hard to justify authorizing the manufacturing of 20,000 units of vérité-style '70s heroin film Dusty and Sweets McGee or Christopher Strong, Katharine Hepburn's 1933 leading-role debut, being able to sell individual copies on demand for a profit represents a win-win for consumer and studio alike. "All these little nooks and crannies in our library, they become viable," he says.

"The dream is that anything that's in our vault, we can make a copy for a person and have it delivered to their mailbox within five days," Feltenstein continues. "At some point, every one of our 6,800 feature films and multi-thousand television shows, short subjects, cartoons--anything in our library--will be available to the consumer ordering through the Warner Archive collection."

Feltenstein stresses that the Warner Archive hasn't replaced or diminished the studio's usual release schedule of older titles on DVD and Blu-ray, but allows that it does offer a new way for even the biggest studios to get in on the long-tail game. "I'm told the other studios are scrambling to put this business model into play," Feltenstein contends.

The Warner Archive not only offers DVDs of the films for sale, it offers on-demand downloads of the films for a lower (but not much lower) price. So far, Feltenstein says, download sales have been "basically a blip on the radar--the overwhelming majority of purchases have been for DVD." (He declined to discuss actual sales figures.)

"I believe that the physical media business is here to stay for a very long time to come--people want to own the movies, especially when you're dealing with collectible titles," he says. That said, he adds, "It would be foolish to believe that downloads from our library are not going to be a growing aspect of our business."

 Just as people have adapted to the idea of listening to a downloaded digital bundle of compressed 1s and 0s as enjoying an album, so have people begun to adapt to the idea of watching movies on a computer screen, or even the tiny window of a cell phone or MP3 player. Apple currently sells or rents thousands of films through its iTunes online store, and Amazon has followed with its own video-on-demand selection of 40,000 titles. And Netflix has augmented its trademark red envelopes full of physical discs flying back and forth through the mail with a streaming library of some 12,000 titles, all free of charge to its 10.3 million subscribers (up from 6.3 million in 2006).

"We think DVD rental by mail will continue to grow for five to 10 more years," says Steve Swasey, Netflix's vice president for corporate communications, "but ultimately, 15, 20 years from now it'll all be streaming, and we believe that we've got a great stake in the ground for that."

Indeed, if anything is holding back an explosion of movies streaming over the internet right now, it's the fact that in most broadband households, the internet ends at a computer. As Mike White puts it, "Most of the time, I wanna watch movies with my wife, so I'm not gonna pull something up on my 20-inch computer screen and say, 'OK, watch over my shoulder.'"

But the internet streaming of movies is creeping ever closer to being as easy and appealing as flipping on the tube. A company called Roku manufactures a small black box that, for about $100, transfers streaming web video from Netflix or Amazon to your TV set. Perhaps even more decisive, Microsoft's Xbox 360 video game console performs the same trick. More than 11 million Xbox 360s have been sold in the United States, and according to Swasey, Microsoft has reported that more than a million Xbox owners have used the console to watch Netflix streaming. White, for one, has a Roku box, of which he says simply: "I love it so much."

The titles Netflix offers on streaming tend to be "catalog" films--older films, foreign films, TV episodes, not the current hits--and, at 12,000 titles, a fraction of its DVD and Blu-ray library of more than 100,000 titles. "When we buy the DVD, we own the DVD, but we're licensing the streaming content differently," Swasey says. "This is new and it's evolving. It's a whole new economic model for the studios." In some cases, he says, Netflix doesn't have a title for streaming because of expense--The Dark Knight doesn't come cheap for any licensee in any form--and in other cases, it's a matter of studios not wanting to compromise other licensing deals.

Indeed, those who hold the rights to films seem to be holding back online streaming somewhat, too. In November 2008, Efe Cakarel launched the Auteurs (theauteurs.com), a web site that's a combination online streaming art-house theater and social-networking nexus. ("We want to . . . take foreign, classic and independent films to the people--and the people are on Facebook and Twitter," Cakarel writes as part of an e-mail interview.) The fledgling site has formed partnerships with gold-standard DVD imprint the Criterion Collection and the World Cinema Foundation and hosts an impressive array of curiosity-stoking contemporary films from all over the world, but so far it offers a total of 500 films for paid streaming, only 113 available in the United States as of press time.

"The big film studios who own a lot of the classic films still make a lot of money from TV deals and are afraid that doing smaller online deals will erode this lucrative source of income," Cakarel writes. "For undistributed films, rights holders hold on to the illusion that niche films have the potential to make them rich when released in the U.S. market and ask for unrealistic prices to show their wonderful films that are destined for small audiences."

Thus far the Auteurs can boast 240,000 unique visitors a month and more than 80,000 registered users, though, as Cakarel acknowledges "not many people have paid for streams yet, but these are the early days for feature length [video on demand]."

Of course, not all film distributors are so conservative and video on demand isn't such a new idea. Cable television--the other fat pipe of information flowing into many American homes--has been offering movies on demand and recent film releases on a pay-per-view basis for years. With the growth of VOD and the wane of theater screens devoted to independent and foreign films, IFC Films launched its IFC in Theaters program two years ago to make its films available on VOD via the IFC Channel to coincide with their theatrical releases. Since the smaller films IFC specializes in tend to roll out slowly nationwide, if they roll out at all (see: Hunger), it's possible that more people might see a film through VOD than in a theater, even during its "first run."

"We found that it was very successful in terms of the way we were releasing," says Arianna Bocco, vice president of acquisitions and production for IFC Films. Not only does adding VOD offer "two revenue streams for all the marketing and publicity we [do] at the time," she adds, it creates "a wider outreach and wider footprint."

Bocco declines to offer any numbers, but does note that IFC in Theaters was successful enough that in March 2008 her company launched IFC Festival Direct to bring to VOD new films that weren't going to be getting anywhere near a theater anyway, from Fear Me Not, a Danish drama about a man taking part in an antidepressant study and suffering from ever more sinister side effects, to Faintheart, a British comedy about historical reenactors.

"We looked at that model and thought. Why don't we turn this into a bigger distribution strategy and bypass theatrical?" Bocco says. "You're still spending money to release the movies, but you're really cutting out the most prohibitive costs of releasing a film [theatrically], which is the 'P&A'"--prints and advertising. "There's some potential that if it does well on VOD that the film could actually make some money for the filmmaker," she adds with a laugh, "as opposed to what most films do, which is lose a lot of money."

Bocco points out that, in the past, most films traditionally went (or tried to go) through a long and long-established series of steps: first a theatrical release, then after a certain number of months to DVD, then cable-TV pay channels, then broadcast TV. "Now we've collapsed windows, because people are watching movies in a different way," she says. "There's much more choice out there, and as a distribution company we had to adapt to technology and the way people are watching movies."

That means, in part, that IFC Films has more control and more options for its releases. Hunger, for example, may have had all the U.S. theatrical exposure it's going to get and would otherwise remain unseen until it arrives on DVD toward the end of this year. Thanks to IFC in Theaters, viewers all over the country, even those who don't have a local version of the Charles or Landmark Harbor East, have had a chance to check it out. (Sadly, the film's run on IFC in Theaters on Baltimore-area Comcast cable has already ended.)

"The films that we release theatrically, you know they're great movies, but you don't have any choice about keeping them in theaters longer," Bocco says. "But this is a way that films can be extended . . . they can have a life on VOD".

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