THB #340: New Deal 2 - Reaching For The Long Tail

“Squeezing Coins From Dollars” by Craiyon

This New Deal series is about living with the long-tail, which really starts after the content is in the release windows. Yesterday, I got caught up in the current WGA fight, which is about how things get made and then, to a lesser degree, how a piece of content continues to throw off money. The math gets complicated… but it’s nothing compared to the new math, which is much less directly connected to that initial event of creation than its been.

50 years ago, television channels went off at the end of the day. The afterlife for movies and their first and second run was revival houses and filler TV for a relatively small number of titles, except for maybe 50 film titles that were so revered that they were occasionally re-released in some way.

45 years ago, Star Wars exploded in theaters and after it’s year+ first run, they first put it on pay television (to disappointing numbers) and then made a deal to show it on network television in 1983.

32 years ago, Universal made a deal with Sears to air E.T. just 3 times in 3 years for $40 million, which was, at the time, ground-shaking.

27 years ago, the biggest selling VHS, The Lion King, sold an estimated 32 million units. But VHS was primarily a rental business, with prices per cassette priced mostly over $70.

26 years ago, Twister was the first mainstream release of a movie on DVD. The industry decided, from the start, to make DVD a sell-thru item, with a price point under $20.

23 years ago, Netflix launched monthly subscriptions.

22 years ago, Netflix tried to sell itself to Blockbuster for $50 million and were turned down.

20 year ago, Spider-Man changed the world with the first CG superhero movie, became the first $100 million opening weekend, and really marked the end of the VHS, fully giving way to the DVD. Titanic, 4 years earlier, and Shrek, just one year earlier, had sold a lot more VHSes than DVDs. Spider-Man sold more than triple the number of DVDs than VHSes.

Between 2002 and 2007, the DVD business was massive and the faucet of content from the studio libraries were opened to the max. But the ownership novelty wore off in just a few years and DVD sales numbers given to the media were made to look good by the release of more and more content, while the number of units sold per title slid quickly.

16 years ago, Netflix was DVD only, a major disrupter, but still had just 6.3 million subscribers.