The Internet and online film distribution

The development of the internet in the last decade has influenced the way in which we watch film and consequently, the film distribution industry.

Internet release has now become a whole new platform of film distribution. Before, the standard release system of film was cinema release for approx. 16 weeks, then released to buy on DVD or video, then after several months it is released to pay TV and it finally could be aired on television after two years.

Online film distribution has enabled film makers to skip all of the above steps and release films to the world online, cutting out the middlemen institutions such as cinemas and TV channels.

Viral marketingViral marketing is a way of spreading information about a film through the internet, increasing interest and popularity. ‘viral marketing’ gets the name from the idea of an online post spreading across the internet like a virus. Social media sites allow trailers of films to be posted by anyone for free, meaning that any film could potentially gain mass exposure through the internet for no advertising costs.

However the most successful film franchise to benefit from viral marketing occurred in 1999 when the internet was still relatively new:

Viral marketing success story: ‘The Blair Witch project’

The Blair Witch Project is the story of three student filmmakers who are investigating the supernatural legend known as the Blair Witch in the town of Burkittsville, Maryland with their recording equipment and are never seen again. A year later, their footage is found and pieced together to make the movie. Daniel Myrick and Eduardo Sánchez, who co-wrote and produced the film, confirmed the original budget was somewhere between $20,000 and $25,000. It was shot on handheld cameras, one of which was returned after use for a refund to keep costs down. The three main actors did most of the filming, and their lines were entirely improvised – they only had a general outline to follow and had to react to situations unprepared.  They had no exact marketing budget so the marketers generated buzz for the movie by using Web sites and message boards to stoke interest in the before its release in the summer of 1999. The blair witch project website became a viral sensation with early internet surfers. As the internet was still a novelty for many, users weren’t aware of how easily internet rumours could be started on message boards so the Blair Witch project became an urban real life mystery rather than fiction.

The buzz caused the blair witch project to become the most financially successful film of all time, grossing over 200 million dollars worldwide.

Although the blair witch project was american made, it epitomises the amount of influence viral marketing can have on the consumption of independent films.

Netflix is an example of a successful online film distribution company that is available in the US, the UK and most of Europe. Netflix allows paying subscribers to rent DVDs online and have them delivered to their home. Netflix now offers Internet video streaming ("Watch Instantly") of selected titles to compatible devices (most smartphones, tablets and computers with broadband internet access.) Netflix is the biggest source of North American web traffic, accounting for 33% of traffic during peak periods and 28.8% of aggregate traffic.In January 2008, Netflix allowed british subscribers to access unlimited hours of streaming media at a fixed monthly rate of £5.99 a month. The average cinema ticket in Britain is £6.37 therefore for the price of just over one cinema ticket users could watch as many films as they wanted instantly.The popularity of netflix has changed the way british people consume film because in a matter of years of having the netflix service, the attitude towards film consumption has changed. Now, consumers expect to have the luxury of unlimited and instant film streaming wherever and whenever they want.

Piracy

Illegal streaming of films online and illegal use of copyrighted material has become a huge problem for film distributors. When previously, the distribution institutions had control over the majority of the film distribution industry, they could filter and determine what films became exposed to the mass market. Online piracy allows anyone with the know-how to stream copyrighted films online and there is still little the government/institutions can do to intervene.Although piracy is opposed by film distributors, the data from piracy downloads has already started to contribute to the success of film franchises. Netflix’s vice-president of content acquisition recently told Dutch site Tweakers that it monitors piracy sites to see what's popular, and makes licensing decisions based on those statistics.

Piracy Statistics released by the directors’ guild of America