Motivated by Paul Graham’s recent fatwa, there are articles popping everywhere with ideas on how to kill Hollywood.
I’ve been thinking about this for a long time. In fact, since podcasts went mainstream with the launch iTunes 4.9 I’ve been what would be the costs of opening an full fledged digital media production company.
In order to kill Hollywood one has first to understand that the problem isn’t technical. We currently have the tools to provide mass distribution of media world wide. Examples of this are both YouTube and NetFlix. We also have the tools today to protect copyright holders if they wrongly choose to do so (there are several DRM solutions, including a new and interesting one from hollywood called UltraViolet that separates the DRM verification scheme from the seller). And also the number of people with a internet connection fast enough to deliver movies is now large enough.
If you are a avid podcast consumer, you should be familiarized with the people-talking-about-stuff show model. TWiT network relies heavily on that. Revision3 shows are also like this but there are some exceptions. Why do most podcasts use this model? Two reasons. The first and most obvious is that is the cheapest way to produce a show. You only need a camera connected to a computer. In fact, if you already have a computer, you can upload the show to YouTube and produce it at zero cost.
The second reason is that it’s the easiest way to produce a show. You can blurp about anything you want in front of a camera. You can have a highly produced show with interesting people (like in TWiT) but in the end is just some guys talking in front of a camera.
Now, for a moment see what we are up against. Podcasts are essentially TV Shows. But what are the most watched shows today? According to Wikipedia, the US most watched show was American Idol. Is not my cup of tea but you can agree with me that American Idol has a higher production value than almost every podcast on the planet. If you look at IMDb most popular TV shows, most of them are both expensive and highly produced shows. In order to make a show like The Walking Dead or The Big Bang Theory you are required to to spend lots of time making sets, have people writing elaborated scripts, thinking on the characters attire, casting actors etc, etc.
I’m not saying that podcasters are lazy, I’m saying in order to kill Hollywood they need to make better shows. And for that they need to hire lots and lots of people.
Another problem you face is the cost of entry. As I’ve said before, the cost of entry is zero. So almost everyone on the planet can make a show. And the problem is that they do. Having lots of shows isn’t a problem it per se but does become when the signal to noise ratio becomes too high you stop finding the good shows shows. An example of this is the iTunes Store podcast section. Generating a lot of bad content isn’t a good thing (e.g. Atari 2600) and can degrade a platform. In some sense I think it has already. Although you have sites like YouTube with some movies with big production value (vimeo is one of those examples) most people don’t think quality when they hear “YuTube”).
Even if you can get a bunch of money from some VC and made some impressive movie, you would be doing yourself a disservice if you don’t sell it to some big distribution company so it can reach a larger audience. You could try to promote yourself your movie that that would require even more money. You probably wouldn’t be making the profit margins that would allow you to bootstrap your business, but even if you could, in the end you didn’t created some kind of platform to distribute your you only made one movie.
So how can we kill Hollywood?
From what I can figure out for the last 3 years thinking about this subject we have two main problems. First is the curation, distribution and marketing. The second is capital.
In order to solve the first, the usual suspects are now attempting to move their chess pieces to conquer the delivery pipeline. Google now is betting heavily on Android for TV and we all know that Apple is working on something. By doing this they are attempting to use the App Store model for content distribution (Newsstand is the newspaper media equivalent). Is not bad, but does has some problems. iTunes App Store isn’t known for its discoverability. Marketing is also a problem. You need to invest heavily on trying to convert TV watchers and this is where Google, Apple (and maybe Amazon) TV Gadgets are important, because they reduce hugely the costs marketing costs. I don’t think that company creating a box would solve this problem because you need a large scale install base and you can’t do that if you are some small company (examples of this is Boxee and Roku. As much as I like them they don’t have enough critical mass to be relevant).
The second problem is a risk game, and I can tell you that the first person to win at it will be incredibly rich. Here is why: You need to get huge amounts of money, get some screen writers, actors and filming material. Essentially you need to bet it all that you will be successful. If you are, you can use that money to make more shows and start your company.
There are some “pluming needed to be installed” before this goal can be reach. First we need a way to find good scripts. You can get in a Starbucks in L.A. and find 20 screen writers. The problem is that I’m not in L.A. and I don’t have much social skills. An interesting idea for a start up is to create a webapp where screenwriters can share scripts. Then you need to find places to film. Another idea is some kind rent a studio system where for some fee you can rent a studio and some equipment. Some of this initial pluming work is now being done by Amazon Studio. More is requried.
The future is bright for media production on the web. For now I’m interested on trumping old printed media on Portugal.