Dirty Secrets of Popcorn Time and Piracy

October 6, 2015

It can be difficult for the average consumer to understand the impact that piracy has on the film industry at large. Hollywood keeps churning out blockbusters. Celebrities keep donning Armani suits and Oscar de la Renta dresses on the red carpet. True, the filmed entertainment sector rakes in over $88B world-wide on an annual basis; it is a lucrative industry. However, the $10B lost to piracy each year is nothing to laugh at. This represents not only lost revenues, but also lost jobs and lost opportunities for films that serve niche audiences....

 

For most consumers, it is a problem that doesn't resonate beyond irritating notices in theaters and on DVD. However, the problem of piracy impacts consumers more than they know. Movie goers increasingly complain about the lack of diversity in movie content - not only ethnic and gender diversity - but diversity beyond "tent-pole," "blockbuster," "franchise" content with global appeal. What they fail to realize is that while these films are most definitely impacted by piracy, losses are offset by massive revenues. However, smaller pictures without high-concept storylines and built-in audiences can't offer such assurances in the age of piracy.

 

When underserved audiences resort to bootleggs and bit-torrent sites to obtain hard-to-find fare, they are unknowingly cannabilizing the content they love. Because films with niche audiences don't make massive profits (which is somewhat subjective given that the most sucessful of them have wider profit margins), studios and financiers aren't as interested in financing them. This has led to the closure and scaling back of independent studio arms. When studios don't finance arthouse and niche films, they are forced into the independent finance market. Often, they have limited access to marketable talent and make compromises in marketability to get the story "in the can."  Every step of the process is fraught with catch-22s and uphill battles. The typical film that secures independent finance resorts to the festival circuit as the foundation of their marketing plan.

 

On the festival circuit, filmmakers struggle to get publicity and wrangle audiences in hopes of securing a distribution deal from attending buyers. However, at this stage, they have no leverage to negotiate the value of their content and they make no money on ticket sales. Over ten thousand films have screened at the most prestigous festivals without securing distribution, and theat number continues to grow. Chances of securing a deal rival the lottery. Even Sundance-award winning titles like Ava Duvernay's "Middle of Nowhere" are unlikely to be found in theaters and take far too long to reach what could be a loyal audience. In the meantime, piracy runs rampant and revenues are lost. The vicious cycle continues. Consequently, fewer diverse films ever see the light of day, and the twentieth iteration of Spiderman enters development. This is the dirty secret of piracy that no patch-eyed movie lover wants to admit. 

 

So what is the solution? For CINESHARES, the answer is connecting filmmakers with their audience from script-to-screen. In our model, audiences support and invest in the movies they want to see and are the first to know when and where they can find and share their favorite projects legally. Filmmakers are less dependent on the festival circuit for publicity and have greater leverage in securing distribution before a project goes into production - just like in the studio model. Furthermore, our patent-pending technology empowers filmmakers to control distribution windows and offer direct distribution to audiences where revenue and engagement are transparent. Most importantly, we incentivize users to share the content they love, and make it easy for their friends and family to conveniently rent or own content. The impact of this audience and filmmaker-friendly model could literally revolutionize how movies go to market and take the wind out of piracy's sails. 

 

 

 

 

 

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October 6, 2015

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CINESHARES is not a registered broker-dealer and does not offer investment advice on investment quality to investors. All investment data is provided by respective issuers. CINESHARES is not compensated for the purchase or sale of securities. All applicable sales / transactions for securities are executed by a licensed and  registered broker dealer in compliance with SEC / FINRA / state-by-state Blue Sky Laws.