Monday, July 10, 2006

The Great White Hope of Indy Animators: Part 2b

picked up from part 2b....

OK, so those numbers don’t seem like much to write home about. Still, there is value there. The iTunes numbers seem to be the most encouraging. And guess what? People are buying video content off of iTunes- and lots of it, too. And mind you- this is all content they could have for free if they knew how to run a VCR. But they’re willing to pay for it to have it on their time, their iPod, their computer- to make it “theirs”.

So let’s go back to my online viewings and apply the numbers. One thing that I think would be wise to do is to offer two versions of my films. The first would be a low quality compressed streaming version that would be free in order to win fans. I don’t have the ability to slap a name like Pixar or Disney on things, so the viewership would have to be earned. Then I could offer a high quality version that people could purchase to keep for their own collection. Let’s assume that of the 80,000 or so online viewings I’ve had for Lunch that I do a very good job of entertaining my audience and that maybe 10,000 of those viewers would end up paying for a keeper version. Apple charges about a 28% distribution fee for stuff they sell on iTunes. So with a selling price of $1.99 per film, that would leave a decent $1.43 passed on to the content creator/producer- in this hypothetical case, me. Quick math type stuff shows that if I could get 10,000 people to buy a higher quality version of a short film that I’d stand to make a little over $14,000. Not enough to live off of, but dang, that’s not too bad for a part time effort. What if I made 3 or 4 shorts per year, instead of one every 3 or 4 years? While not a full living in itself, it might be a viable portion of a collage of money earning activities.

My buddy Tim Hodge opines in the comments on the previous post…

After all, even if you could find a way to market it effectively, what’s to keep one person from paying a buck for your film then emailing it around the world? …. Even if there was a secure way to sell your work on the web, you’ve got a lot of stiff competition, like Strongbad podcasts…. for FREE… and really funny! If you want to sell something, you have to make sure it’s even better than that, or else have lots of merchandise to sell.

Good questions. But I think it might be overlooking something innate in human nature, namely the desire to be involved in an exchange of value. For reasons that are not entirely machiavellian people actually do want to buy things, even if they could have the same thing for free. We find this in the very poor river people here in Brazil. We roll up on a big medical boat and if we give them the medicines for their health, they have a laid back attitude about actually taking the medicines. But if we make them buy the medicine- even if the value exchanged is massively out of alignment with their true value (trade a strip of beef jerky in exchange for a full course of anti-parasitic medicines worth $100) - then we find they take the pills religiously. For some reason we’re wired to want to be involved in this value exchange.

The basic question here is: Does what I have to offer have enough latent value to cause people to download and have their own copy for $1.99, even if they could watch it for free? Well, I don’t know. But people do pay that kind of money for video online. So while copies of these things can easily be had for free- and in my own imaginary business model a copy of my own stuff would be free in streamed format- if the stuff is any good it’s not unreasonable to assume that somebody would pay to have a copy of their own in higher quality. Piracy does take a dent out of all media businesses, but record companies and movies studios aren’t exactly starving for sales, either. People still want to buy things- it’s the transaction, the exchange of value for value that they want. It’s a social thing. So maybe the question isn’t “If Homestar Runner is free, then shouldn’t yours be free, too?” Rather maybe the question should be “If people are willing to pay to have a copy of free things they really like, shouldn’t Homestar Runner be offering people the chance to own their own copy?“. Maybe the looking glass is pointed the wrong way?
But all this is rather moot at the moment. The problem is I’m not on iTunes. And the liklihood that I could get my own little spot on their Short Films page is next to nil. I’m just not worth their trouble, not at a measley 10,000 total paid downloads per title. And while it is true that in cyberspace there is no limiting physical shelf space like Walmart or Virgin Megastore, there is still limited screen space. Why take up precious promotion pixels with a product that doesn’t promise to move hundreds of thousands of downloads? This is another flaw in a lot of “long-tail” talk- the argument that digital distribution has no shelf space battles. Hogwash. Those 1280×1024 pixels are darn precious! Nobody wants to waste them. Sure you can search for the content you want, but you can do that with Google already. Most of the long-tail discussion centers around how distributors can cash in on the diffusion of media tastes. Next to none of it really applies to the little guy actually making the content- at least not if he wants to make a living from it. So really, instead of doing away with the gatekeeper system, iTunes has just made Apple the new gatekeeper. Always with these gatekeepers! So in my next post I address what I think is needed to get around this.

In the meantime you guys tell me if I’m smoking crack here. Heh.