In this opinion piece Torsten Hoffmann warns 3D filmmakers about common pitfalls and gives advice about how to best position your film for global distribution. This is the second installment of a two-part article. The first part ishere.
. . . At the Korean I3DS event in December, I showed a slide entitled ‘Be Careful 3D Filmmakers’ and many producers approached me afterwards about the bulletpoint list and asked me specifics. So let me replicate/expand the 13 point list and explain in a bit more detail. Feel free to add your comments and stories in the comment section.
7. Broadcast Specs
This one is relatively straight forward. We work with many low/medium budget productions and obviously the first 3D film from any filmmaker will turn out to be less than perfect in terms of 3D quality (and probably behind schedule and over budget, too). Typically the second and third film from any producer will be on time, of much better 3D quality and oftentimes even at little or no additional cost (compared to 2D). Filmmakers learn the skill of mastering 3D very fast (our blog features many case studies and interviews). However, there is still the ‘not so good’ film to be marketed. Don’t worry this will not ‘kill the 3D industry’ as our friend 3DGuy argues here. I would strongly recommend to try to comply to the published 3D specs as much as possible (here is an incomplete list). Recently I was offered 3D content in 720p resolution and I think it is plain to see why 1080p would have been the smarter and not much more expensive choice. In fact, in the past two years we have signed only one single licensing deal with lower than 1080×1920 resolution and that was for a mobile/tablet company that targets smaller screen sizes. The resolution is only one, rather obvious example. Also, I think it would be smart to take out all footage that has shaky camera moves or lense flares, or scenes that are just too dark or out of focus. Almost every week some of our films get rejected for ‘technical reasons’ by buyers while technically stronger titles do achieve more deals, regardless of topic or storytelling. I am 100% sure that by just avoiding some of the most obvious issues more license revenues can be generated.
8. Real or Converted 3D
On this blog we have argued many times that we firmly believe in stereoscopic 3D production. As a general rule 3D Content Hub does not represent 2D to 3D converted films. And likewise 90% of our customers are only buying native 3D content. Yes, there are use cases for conversion (re-releases of jewels in the Hollywood archives or special effect sequences) and even purists like BSkyB now accept up to 15 percent of converted material in 3D films, but as a general rule, go stereoscopic. Today, there is little extra cost for capturing 3D anyway (as 3ality or CPG representatives and most other camera suppliers continue to point out).
9. Music Rights and Wrongs
The next one is not only straight forward but also common sense. Unless you are filming a 3D music concert with a global superstar artist or are distributing a Hollywood blockbuster feature film, always chose non copyrighted background music. Recently one of the top media corporations worldwide with multi-billion dollars of annual revenues told me “We now require royalty free music for all our acquisitions”. Check Mate. Don’t even think about anything else. Period. There’s plenty of resources to get free beats from if you need them. I am not going into details of how many deals I have lost because of music rights, it is too frustrating, and totally avoidable. And, no matter what genre you are looking for, you will find something – there’s even Royalty Free Metal Music for those looking for something a little bit different.
10. Choosing the Genre
If you follow our blog or Twitter you already know where we stand on this issue. If you want to exploit your 3D video assets globally your film should better have an international appeal. We are still seeing many too German, too American, too Korean, too Chinese, … 3D films that noone outside the country of production would seriously consider watching. Think global. Use world famous historic events, inventions, technology, art, wildlife, cultural memes. Be careful with the presenter (we prefer without presenter; just voice over is easier to localize). I used to say that ‘we prefer sharks in 3D because a shark is a shark is a shark: in the US and in Germany and in China. The topic travels well.’ But now, with about a dozen 3D shark films in the market that obviously would be bad advice. So uniqueness is also important. Surely, in our portfolio, we have not always followed these rules as we are open to taking chances with new concepts that we like or that are technically very strong. But as a general rule, try to go for an ‘international theme’, try to be ‘unique/first of a kind’. And finally, make sure the film is non-current. 3D licensing terms are usually one or two years (in the DVD/BluRay business sometimes up to 10 years). Noone that far in the future will care about the outcome of a particular sporting event or watch seasonal festivals, current exhibitions, or anything related to ‘news’ or the latest fashion.
11. Budget Woes
This is probably a topic for a whole separate blogpost at a different time. Noone has yet figured out the right answer. While we see larger-scale 3D films being hopelessly unprofitable because they were working on a huge (2D) budget but only addressing the tiny 3D market. We see this most frequently in the USA and UK. At the same time independent companies with small teams located in ‘cheaper’ countries with easy access to good travel/history/wildlife/nature locations are doing well.
I do believe that there is a big opportunity for fiction, a genre that we don’t represent at all, and that is clearly underrepresented in the 3D marketplace. Fiction budgets are, almost by definition, much higher than non-fiction but independent producers have not had much success with the genre yet (Tom Konkle talks about his experience with Safety Geeks in this podcast). As a complete outsider with not much Entertainment experience it almost seems to me that a feature film gets more profitable with a higher budget. Do some research yourself on boxofficemojo a site that lists domestic, worldwide BO income and production budgets. The additional 3D budget for major films is relatively small compared to the total production and marketing budget. In Prometheus‘ case it was only around 12 million USD while total Boxoffice was 400 million USD. For wide theatrical releases the additional costs are almost always justified because in many countries the additional ticketprice should recoup that cost. But if you are reading this blog, you probably do not work for the majors. ‘Our’ world is budgets between 25,000 USD and 2.5m USD per film and we have not seen a proven formula unfortunately.
12. Revenue Share Deals
Recently I listened to a very discouraging story on a podcast interview with filmmaker Scott Derrikson. One of his (2D) horror films with a production budget of under 20 million USD grossed over 150 million USD worldwide and in his contract he had a profit share clause. His share of the profit was zero. Nothing. Nada. Why? Because the mainstream media and the theatrical distribution machine has figured out very sophisticated means to make sure that everyone but the creatives in the process get their share. It is not a very friendly industry if you are the underdog, the independent, the filmmaker.
Taking this to our level of 3D distribution, I would like to caution against revenue share agreements with customers. We are offered revenue share deals almost every week, but in most cases generating actual cash from these deals remains difficult. A lot of times these are new platforms and VOD services with almost no traction and no existing customers and they provide no sales forecasts. Nevertheless we are agreeing on rev share terms in some cases; for example if the client explores a market that is otherwise not exploited, or if a customer already has a large customer base or a strong brand name. For instance, we recently agreed to such deal terms with a European cable provider with three million subscribers. Another possibility, and one of our tactics, is to give the first episodes of a (mini) series for rev share but hold back the rest of the episodes until you get traction. But in any case NEVER give exclusive rights in exchange for revenue share deals. And wherever possible try to prioritize Minimum Guarantee deals. If your film is technically weak (3D Quality) or the topic/genre/story is too niche to attract many deals, then explore revenue share deals carefully.
13. Distribution Fees
Another bad habit from the 2D space is becoming a ‘dangerous’ trend in 3D. Distributors are companies that are meant to sell your film internationally, take it to broadcasters and other clients, present it at filmfestivals, market and promote your film. These firms – just like sales agents – are supposed to MAKE you money in exchange for their sales commission. If these distributors ask for management retainers, or recoupable distribution fees, or offer their paid services for postproduction or marketing work, I think that something may be wrong.
Having said this, I am the first to admit that yes, we are oftentimes in a situation where a film is not ‘ready’ to be marketed yet, where additional work is needed. Some scenes need polishing or (oftentimes) the audio isn’t perfect yet or better narration is needed. In these cases a distributor has to make a tough decision: Either to present a ‘rough cut’ to buyers or fix the problems first because usually buyers give you only one chance to pitch a film. In fact these are the most difficult discussions that we have with our 25 producers and there are no general recommendations that I can think of. It is a case by case decision. Nevertheless, our philosophy on this issue is relatively straight forward. It is the producers job to fix all problems at own cost. And it is the distributors job to get the sales at own cost. But yes, there are borderline cases where e.g. an Asian producer really needs native speakers to work on the script and invest in new narration but will not/cannot commit to the costs. In this case lets find an arrangement. I can also understand why it would be a good idea for a distributor and ten filmmakers to team up and jointly invest into a booth at an important filmfestival. At the end of the day it is, hopefully, an agreement between two willing parties. If one partner, usually the producer, thinks something is ‘fishy’, then maybe it is a good idea to talk to your peers and ask around for other and better arrangements or partners.
Special thanks to Torsten Hoffman. Hoffmann is the CEO of 3D Content Hub.
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