Entertainment Emerges As A Key Digital Battle Ground

Entertainment Emerges As A Key Digital Battle Ground

In this opinion piece, Michael Gill from business advisory firm Dragoman and former editor of The AFR, says the big global media companies now realise the huge earning potential of a hit show or movie and it’s creating a rather expensive war for those wanting to snare the rights…

The dimensions of the struggle over entertainment are becoming clearer by the day.

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Netflix first upped the stakes by investing in its own product — a line in the sand being its very large cheque for House of Cards.

In 2015 a few elbows were shoved out in the form of Amazon Prime’s subscription model (media is a significant part), HBO’s tentative steps into on-demand video and the rapid development of streaming options by broadcasters in local markets from Tokyo to Sydney.

Google appears to be entering game at a point that may be aimed at Apple, but could also be a large-scale channel play.

So the entertainment content game has become heated. Studios seem to be retreating toward blockbusters while traditional distributors are at war with the VOD disruptors in the battle for rights.

Amazon paid $US10 million at the the Sundance Festival for Manchester by the Sea, knocking off traditional distributors like Sony or LionsGate with the heft of its cheque book. Netflix was equally aggressive, paying slightly lesser amounts for the rights to less marketable product.

Distributors are attempting to head off the threat with debates about the metrics of streaming audiences and how that translates to awards (a signifiers of bankable talent). But that might not be the issue.

What Netflix, Amazon and Google offer is the chance to monetise directly the content that appeals to global audiences. The more they turn that to cash the more they can decide the true awards: cash paid to the content creators.

This latest entertainment game is still new and we don’t yet see the full effect of content makers like HBO in the on-demand market (they are tied to the profitable legacy of broadcast and pay TV).

At least for the next few years it should be fun making movies — for those with the right ideas.

This article originally appeared on B&T’s sister business site www.which-50.com




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