Do ‘innovative’ VoD releases offer UK distributors a worthwhile revenue stream or are they just tinkering at the edges? Andreas Wiseman reports

Netflix made UK headlines again last month when it struck an eye-catching deal with Virgin Media for the platform to pilot the service with 40,000 of its pay-TV Tivo set-top box subscribers, a first step towards reaching all 1.7 million Tivo customers by the end of the year. The partnership is Netflix’s first agreement with a pay-TV platform.

Studio content continues to rule the roost on subscription VoD (SVoD), pay-TV services and on the rising number of transactional VoD (TVoD) platforms. “When you look at transactional content, the most-watched content will continue to be the blockbusters,” says Nick Forward, Virgin Media’s TV product director.

However, with most commercial exhibitors insisting on a 17-week window for new releases and with high-street vendors on the wane, independent distributors, many without lucrative Netflix and LoveFilm deals, are finding new ways to respond to shifting public viewing habits, including through simultaneous multi-platform releases.

The growing number of VoD services are fundamental to that adjustment. (The UK also recently saw the launch of its first horror-only VoD platform: Recent months have seen a number of day-and-date theatrical-VoD releases, including Film4’s Ben Wheatley drama A Field In England, Curzon-Artificial Eye’s A Late Quartet and Lionsgate and Icon’s comedy Bachelorette.

Curzon-Artificial Eye released A Late Quartet on 49 screens in April for an impressive debut of $171,000 (£111,289), including previews. On VoD the film drew 3,000 rentals and 2,000 downloads from Sky in its first three weeks, 705 views on Virgin FilmFlex in five weeks and 300 views on Curzon Home Cinema. If the digital numbers do not seem spectacular, the strategy is still seen by many as a step in the right direction.

The same goes for A Field In England, the UK’s first simultaneous release across all formats, which debuted theatrically with $32,000 (£21,399) from 17 sites and drew decent numbers on TV, DVD and VoD. Director Ben Wheatley, producers Rook Films and distributors Picturehouse and Film4 were happy with the numbers for a niche film that might have struggled to sustain in cinemas.

Bachelorette was released on around 20 cinema screens the same day it reached VoD partners including Sky Store, Virgin Movies, Xbox Video, Film4, BT Vision, Google Play, Blinkbox, Knowhow Movies, Sainsbury’s Entertainment, Domino’s, Everything Everywhere (EE) and PlayStation Store.

‘We compare notes with our US counterparts and they clearly have a VoD model and we do not’

Alex Hamilton, eOne

Theatrical numbers were modest and VoD numbers unavailable but according to Forward and Lionsgate, the film performed well digitally.

“We have seen strong digital sales on female product in the last few years so decided that Bachelorette was the perfect title in which to trial this approach,” says Nicola Pearcey, managing director home entertainment and new media at Lionsgate UK. “This has proved an enormously successful strategy.”

There is a way to go, however. “The VoD numbers are still small, they are not transformative,” recognises Alex Stolz, head of distribution at the BFI, which has backed a number of alternative releases through the Distribution Fund’s New Models strand, including A Field In England and A Late Quartet.

“We are interested in getting new films out to new audiences and an increasing number of companies are coming to us for help with this. But the key question is whether VoD revenues are additional or whether you would have taken more money in the cinema.”

Pricing strategies

Pricing remains a key challenge for distributors whose product is playing on multiple platforms at the same time. For Curzon, that includes their own platform Curzon Home Cinema (previously Curzon on Demand).

“Should premium VoD mean premium prices?” asks Stolz. “We are finding challenges to that assumption. When A Late Quartet went day-and-date, the pricing on Sky Box Office and Curzon on Demand was around $16-$17.70 (£10-£11). But then if a platform like iTunes is selling films early for $4.80-$6.40 (£3-£4), we’re in a difficult situation.”

Distributors are learning what works on VoD. While a grey pound hit such as A Late Quartet was a tricky VoD sell, early numbers are stronger on drama What Maisie Knew starring Steve Coogan and Julianne Moore.

Alex Hamilton, MD UK, eOne, sees some of the changes in strategy as largely cosmetic: “I am a little sceptical about this obsession with innovative distribution strategies. In terms of recreational consumption of mainstream films, it’s tinkering at the edges. We compare notes with our US counterparts and they clearly have a VoD model and we do not.”

Despite slow progress, steps are finally being taken to draw closer to the US.

“I think in a year or two you’ll see more bigger titles with multi-platform release strategies,” concludes Forward. “From what I see, a film like Bachelorette has performed well, and above expectations. As that becomes closer to the norm, that will become a legitimate practice for the indies.”