Amazon Studios: Would You Pay to Watch?

That’s always the key question. Here’s Amazon’s mission:

We think this will be an effective way to develop commercially viable feature films. There are four things we think can make the Amazon Studios process valuable:

The power of the people. Amazon Studios will give artists and film fans around the world the chance to create and evaluate potential movies. We believe that feedback from a large number of people will be a helpful indicator of what is working and what is not.

Evaluate test movies, not scripts. With today’s inexpensive production and editing tools, it’s easier than ever to produce a visual expression of a script. People might find it easier to evaluate a story’s prospects as a movie by seeing it in movie form (even primitive movie form) rather than reading the script and imagining the movie.

Experiment. Complex problems often require a lot of experimentation to solve. Amazon Studios is designed to be a flexible environment where experiments are encouraged.

Collaborate. When a motivated group works together, openly experimenting and responding to feedback, it can make the most of everyone’s talent.

All well and good, but would you pay for this? If not, then how does it make sense? Consider this:

One interesting thing that I’ve always found about the film business from an economic point of view is that unlike in any other business I can think of, the cost of manufacturing the product has no affect on the purchase cost to the consumer. For example Honda can make a cheaper car with less features and cheaper finishes than BMW without losing all of their customers to the superior car because they sell their product for less. You spend less to make something, you charge less for it. Makes complete and obvious sense.

Not so in the film business. I am an independent film producer and I make films that typically cost somewhere between $5M and $10M. But when I make, say, an $8M film it has to compete at the same price level as the studios’ $80M or $100M film. It costs the consumer the same $12 at the multiplex (and whatever it costs to rent a DVD from Blockbuster these days) for either film. There is no price advantage to the consumer for choosing to see a less expensive film. This naturally makes it terribly difficult for smaller films to find an audience.

One possibility here is that the biggest value-add in the filmmaking process isn’t actually the film, it’s the promotional campaign. Most independent filmmakers desperately want to get picked up by the studios for one simple reason: distribution. As soon as the studios have you they buy ads.

Advertising creates demand. Unless Amazon has a way of kickstarting positive awareness feedback loops, the quality of the films on their site is irrelevant.

This kind of thing shines a slightly different light onto the whole SOPA thing. It has nothing to do with defending IP but everything to do with defending a distribution model that people say is dying, but maybe actually isn’t.

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