omg: Steve Jobs agrees with me about how Hollywood will have to change

I’ve been talking about it loudly and frequently for ages: the entertainment environment is changing rapidly, all sorts of new options are available for acquiring and viewing movies, and Hollywood should be listening to how its customers are telling the industry it needs to change. Going to the multiplex is an expensive and unpleasant proposition these days, and certainly not worth the hassle and the cost when the movies on offer are so terrible so often. (There’s a good reason why box office receipts are down so sharply this spring: the movies suck.) Hollywood might boost its takings some, even with the same crappy movies, if it gave us more options for seeing new movies: day-and-date DVD releases and day-and-date on-demand options.

Hollywood, of course, doesn’t care what I think, and keeps refusing to listen to me. Maybe Hollywood will listen to Steve Jobs?
The Apple honcho spoke at the recent D8 conference, which covers “All Things Digital,” and some of his comments seem to suggest that he and Apple are ready to lead Hollywood into this brave new world. “We want to let people watch whatever they want, when they want,” he said to the crowd of industry types who paid big bucks to listen to his wisdom. “That’s what needs to change.” And this: “I even think you’ll be able to watch a first run movie before it hits theaters… if you want to spend a bunch of money.”

That’s already happening, in fact, with plenty of low-flying indies and foreign films: We’re seeing many films available on a pretheatrical rental basis via Amazon’s Video on Demand service. But all of the movies that have so far been offered this way have been ones that would get only a very limited theatrical release anyway… meaning that these on-demand rentals are the only option most moviegoers have of seeing the film at all prior to a DVD release. The real measure of the on-demand option will come when most moviegoers have a genuine choice: Pay ten bucks for an on-demand “rental” and enjoy a movie with friends from the comfort of your living room, with snacks that won’t break your budget? Or venture out to the multiplex down the street, pay through the nose for sugar water and artery-clogging Golden Topping, and listen to idiots yak on their cell phones during the film?

Jobs suggests that Hollywood may not quite understand that its customers are not the multiplexes or the DVD retailers but the people who actually buy movie tickets and watch movies:

When we went to music companies, we said who is your customer… they said Target, and Best Buy — they thought the retailer was the customer. What changed in that industry was the front end, the distribution and marketing was able to be done in a much more effective way, going right to the end user.

This came in response to a question from “one of the owners of Village Roadshow pictures,” who seemed to think that it was a good thing that the studios have “made a great business of forcing the consumer to come to us.” So there may be a way to go still before Hollywood gets it. But Jobs, at least, seems to understand where things are moving, and with the iPod and now the new success of the iPad, perhaps he can hurry things along a bit.

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Wed, Jun 09, 2010 11:51pm

What makes this very interesting is that Steve Jobs is not just the Apple honcho but is also on Disney’s board of directors (since Disney bought Pixar in 2006). So he might actually be in a position to do something about this.

Also, speaking of knowing who your customers are, Dell went from a college dorm room to a leader in the computer industry by eliminating the retailers and selling direct. Books have been written about it. I do not understand why the music and movie industry continue to be dominated by people who are so astonishingly bad at business.

Thu, Jun 10, 2010 3:21am

The movie business model has more in common with books and music than with computers. The dirty secret of the arts business is that a very small number of your products make the vast majority of your profits. If you could tell which were the money makers beforehand, showbiz would be like selling shoes. The studios have run the business for so long because they were the only ones who had the money to get a movie made. They maintained their iron grip on distribution to try to tilt the odds in their favor.
Now that they are losing their control of the distribution, they will only put their money into the surest bet they can find. Hence the absolute lack of creativity in new movies being greenlit.
Maybe there were some benefits to the old ways after all.

Thu, Jun 10, 2010 5:31am

Being fair, I think that pretty much everyone who isn’t currently making money off the current system knows the system has to change. So does Hollywood, probably – they’re just sucking the corpse dry for as long as they can.

misterb, the hardware is getting cheaper, and as the star system blatantly falls apart the cost of making a film is coming down as long as you stay away from expensive stuff (mostly SFX). What’s mostly missing IMO is a distribution channel that allows for profit even on the small scale. I’d love to see lots of small cheap films made by people who’d never get a chance in Hollywood because they still have some creativity…

The customer focus makes a lot of sense. If you work for a studio, you can have a meeting with the guy from Target and get a definite commitment: we’ll buy X thousand DVDs at price Y. Ditto with a theater chain. It’s all normal business. Trying to appeal to individuals is a completely different game, and all they know how to do in that field is pay a publicity agency.

Thu, Jun 10, 2010 12:16pm

Yes, I was thinking about the lower cost of movie making as I wrote my OP. It’s the youtube problem, though, how does an inexpensively made movie get the attention (or lack of attention) it deserves? The odds of going viral are smaller than having a Hollywood hit, and much harder to monetize.
Here’s the key to me, and I hope MaryAnn likes this:
critics! We need some brave souls to wade through the millions of hours of crap to find the few minutes of diamonds, and we ought to pay them to do it.

Thu, Jun 10, 2010 12:32pm

I enjoy sitting in a big theatre to see movies, going somewhere enhances the experience to me. I think you lose something sitting at home, it invites distraction. That being said, the theatre model has to change somehow for it to continue to be viable, I just have no idea how to fix that.