Streaming services want to reduce churn and generate anticipation. Producers want to create IP and capture value. To that end, I expect to see more experiments in the following formats discussed roughly in order of probability. They all sound fun to me and a couple of them borrow from the history of film and television.
The Serial Movie Franchise
Think M3gan but the sequel is coming out in three months. Then part 3 three months after that. Etc. Or imagine Jack Ryan as a movie that came out every three months for two years.
The idea here is that instead of having a one off movie, we have a franchise that creates anticipation over the course of the year. The goal is to reduce churn for subscribers. It’s presented as a movie because the material works best in that format and to make it more of an event.
You could argue this is just the MCU. In a way that’s true, but I’m imagining taking the concept to other genres and keeping the stories within a more closely related narrative. (So you wouldn’t go from Thor to Ant Man, it would just be Thor, Thor 2, Thor 3…)
Obviously we face the risk of the first one being a bust or not being able to execute consistently, but that’s true in all things. You have to be highly confident of the property, the premise and the talent, because basically you have to write four scripts for the year in advance and you’ll have to shoot two or three of the films before you know whether the first one is working. So there is risk, but there is also upside.
The All Year Series
The trouble with series is that they end. When a season ends, subscribers often churn out of a service. But what if the universe of a series was big enough that you could do an episode every week of the year? So let’s take Billions. What if the universe of billions was expanded to include a bunch of new characters and we went between all of these characters and, obviously, in a soap opera-ish way, went through all the stories over the course of the year? Call it Wall Street.
Again the goal is to decrease churn.
I think the question is whether you could really maintain quality or does it just become, inevitably, Days of our Lives?
Maybe X-Men would be a better example. In theory, there could be many more members of X-Men. You could do 52 episodes per year.
I tend to think it would be possible to deliver something that would be much closer to Billions than Days of Our Lives, though you have to follow multiple stories within this universe. You need multiple leads, essentially. If you spent $7MM per episode, the program would cost $364MM/year. Which is obviously a lot. But, again, risk/reward.
Obviously, regular TV did this with soaps, talk shows and game shows. It makes sense.
The remaining two are independent of streaming services.
The Online Festival
Get three great filmmakers and three prestige producers. They are going to curate a lineup of 10 movies. The budget for every movie is $5MM.
The movies will all appear over the course of a few weeks, like a festival. There will be a place, like Discord or Telegram, where participants can discuss the movies.
The budget for the movies collectively is $50MM. Probably including legal, management, and marketing (mostly marketing), it’s $110MM.
You finance 50% of this with a TBD partner. They’re in for $55MM contingent on your selling enough subscriptions.
Sequence of events —
Organize the producers
Identify the projects and make deals
Market the bundle to customers
Normally you would go to festivals here with some of the films. But the subscribers might want to see the film “first window.” Might have to skip festivals. (Or offer a lottery where we go to festivals and bring a few subscribers per movie.)
Give subs a two week Premium VOD window.
Go to theaters.
Go to subscription video service.
Customers subscribe to the whole thing or not at all. You can only subscribe before it starts. The festival retail price is $99. If you become a sponsor, you get a copy of all 12 films. You get the NFT. You get the fest t-shirt. You are a member of this community. You get production updates in Discord and on email. You see each film in a PVOD window as soon as anyone can see it.
Let’s say you get 400,000 customers. That’s $40MM. This is a PVOD window so that’s $40MM that is incremental to your normal economics. Because after this window you will go to theaters.
If you set this up on thefestival.xyz, getting the 400,000 customers will cost a fair amount. Maybe $20MM. However, you can apply that against the long term value of festival.xyz and continuously offer new festivals. In the alternative, you could partner with Apple and Amazon to create the format (essentially a bundled movie sale) and give them 30% of revenue. They would bring the traffic and guarantee a certain amount of promotion.
The PVOD window gets in the way of going to actual festivals. Could the PVOD window be post-Cannes? Maybe.
Obviously the core challenge is getting people excited enough about this slate. But that’s on you as a producer.
The Freestanding Universe
What if you could just subscribe to a single property? It’s a universe — one universe, multiple shows. It isn’t on an SVOD service. It’s just on its own website.
Like let’s say — I’m making this up — you have a star and a writer, actually let’s just imagine it’s Yellowstone. So you have Taylor Sheridan and Kevin Costner. And, to change it slightly, let’s say that Yellowstone had been based on a big book everyone was waiting for.
You plan out this arc where you’re going to do Yellowstone, 1883 and 1923.
First you just do season one of Yellowstone.
When you see that it is as big a hit as you thought, you crank up all three shows and add a fourth show so you’re going to be delivering 4 x 13 = 52 episodes per year. Your monthly cost for programming is 4 x $7MM = $28MM. I’m saying the show costs $7MM per episode. It certainly could be more.
In addition to content costs, you have marketing, management, customer service and bandwidth. Let’s say your total monthly is $60MM. We can get back to this and refine it.
Let’s say your monthly average revenue per user is $6.
You also have a U.S. free TV deal with a window 9 months after premiere on your service and an ex-US free TV deal you sold at MIP, and together these deals are going to cover 55% of the show budget. So now your monthly is $44.6MM.
You need 7.4MM subs to break even at $6/ month.
I think this could work. You have to have big IP and probably a star.
An alternative, cheaper approach would be if you focused on stand up comedy and animated comedy. So this would involve bringing together a troupe of comedians, putting out stand up and shorts on a regular basis, maybe doing an SNL type show, and an animated comedy. Could you get 3MM subs for that? I suspect so.
The advantage in any case is that you wind up owning the whole thing. Your upside is uncapped. If it’s a big hit, someone would offer to buy it. You could sell or you could just enjoy the profits of the service and try to grow it.
Until next time!
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Maybe I'm mistaken, but wasn't the failed "Seeso" comedy streaming service similar to what you are proposing in the second-to-last paragraph?