2 The distribution life cycle of a film

Alex Hamilton is Managing Director of Entertainment One UK, one of the more significant independent film distribution companies in the UK, with operations all around the world.

His company operates in the UK, Spain, the Benelux Union, Australia and Canada.

The distributor of a film is responsible for exploiting the film once it has been made. As you will see later on in the course, the distributor, along with the sales agent, can also play a critical role in how the film is financed, but let’s focus here on distribution.

The existing model for the exploitation of films is the concept of ‘windows’. This refers to the fact that films can be seen in many different ways – in the cinema, on television, via VoD, etc. Over the years, the film industry has developed a pattern of releasing films on these different platforms, in a particular sequence, over an established time frame. In the video, Alex gives a step-by-step guide to the life cycle of a film.

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Transcript: Video 2 Alex Hamilton talks about the life cycle of a film

ALEX HAMILTON

 So the best way to think about this is of the life cycle of a film. You might buy a film based upon a script and based upon some talent attachments. You might then see that film after it's produced, which might be some 18 months later, whereupon you then have to make some decisions around that film. How good is it? How commercial is it? What do you expect to do with it in each of the windows that you're going to release the film?

The first window you're going to release it in is the theatrical release window. You're going to release it into cinemas. Now there's going to be costs associated with that, some very significant cost, very particularly in the UK and any of the major markets. It costs usually seven figures and more to release a film in cinemas in the UK if it's going into more than 300 cinemas.

Usually about those five months later, the film will appear on DVD and digital platforms, transactional platforms. That's historically been more the more lucrative parts of film distribution. DVD was an explosion in the early part of this century, and although it's being eroded now, it's still a very robust means of income for a film distribution company. A film on DVD quite often generates more revenue for the film company than the theatrical release window.

Following on usually around 9 to 12 months after the theatrical release and about four to five months after the home entertainment transactional window, the film will enter one of two other windows. It might enter a paid-TV platform such as SKY. So it would be shown regularly on SKY. Or it might enter on Amazon Prime Instant Video or Netflix, two things which are called subscription video on demand platforms. They are effectively the films being exploited in what we refer to as the first pay window. Now that is people are paying still to watch the film directly. They may be paying either SKY, a pay platform, or they may be paying a subscription video on demand platform.

But they are effectively buying film content. And you will licence your films to one of those platforms usually for a fee. And that will usually last somewhere between 9 and 12 months further.

That would take you up to roughly around two years to two and half years after the theatrical release of the film whereby you can make it available to free television broadcasters, so Channel 4, or the BBC, or ITV. And they will also hopefully buy your film for a fee, which they would offset against the advertising revenue perhaps that they can get in that period whilst they're showing your film. So they will perceive your film to have a certain value on their channel.

Then really the film goes into catalogue. It's a catalogue title. It's an old film, if you will. And you can still exploit the rights to that film continually through all media. It's unlikely that it's going to go back into cinemas unless it's a classic, and it gets programmed in repertory cinemas, which themselves are getting less and less available now. But most likely, it's going to have value for TV broadcasters, subscription video on demand platforms, or any platforms that aggregate content.

End transcript: Video 2 Alex Hamilton talks about the life cycle of a film

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Video 2 Alex Hamilton talks about the life cycle of a film

The focus on cinema release and promotion is instrumental for recouping investment, but the current system of ‘release windows’ is under increasing pressure from changes in audience behaviour. The standard sequence of release for a feature film places cinema release at the top, followed by video/DVD/BluRay, VoD, pay-TV and finally free-to-air TV. However, Europeans watch films mostly on free TV, on DVD, and via on-demand services.