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back to article DreamWorks CEO: Movie downloaders should pay by screen size

Jeffrey Katzenberg, CEO of film studio DreamWorks, has suggested that Hollywood should move to a new pay-per-screen-inch pricing model as movie downloads become more popular. Speaking at the Milken Global Conference in Los Angeles, Katzenberg said that in the next ten years he would like to see the movie industry move to the new …

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Allofmp3

Remember the "rouge" MP3 site that sold tunes by the data volume, in the format of your choosing, and DRM-free? Much easier to mange as no device type info needed, just let consumers choose the image size/quality and price it accordingly.

Oh and the industry might make more money if they turned out better films and less crap remakes. Just my opinion of course...

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Re: Allofmp3

And crap sequels - don't forget those!

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Re: Allofmp3

I'm all for finding new pricing models but the movie industry do need to get a grip of themselves.

A movie from google play can cost 6.99 for SD and 9.99 for HD. What I don't get is its the same film - the actors did no more work, they had to film it in the highest resolution anyway. In fact, surely then going on to make a SD version costs money! The actors/directors/etc got paid the same, the distribution cost difference is negligible and I don't believe the royalties are different either. If they can sell the SD for 6.99 then the HD should be 6.99 and the SD version should not exist. Its this 'taking the piss' that consumers don't like. Plus DRM is a pain in the arse.

If they bothered to look at the music industry and the fact they have on the whole grown up and got over the fact that the odd person pirates stuff, now they sell without DRM because enough people buy it. Its cheap, so taking a chance on an album isn't that much of a problem. Plus I can put it on all my devices with little resistance.

So, if they made films DRM free (happy with some hidden watermark as long as it doesn't infringe on me playing it on anything I choose) and cheap then I'd buy more. If films were all £5 I'd buy 10 times the movies I buy now, because when a film costs me £10+ I don't buy that often.

And thats the strange rub, maybe, just maybe selling them cheaper and giving more flexibility they'd sell a lot more and make a *lot* more money. Stack em high, sell em cheap.

I can't help but think a lot of people pirate because it offers more flexibility and a cheap price point. Its not that people won't pay something - I truly believe they will - but if it becomes a real pain to watch it because of your hardware then of course they will take the path of least resistance.

I really thought the movie companies would have got this by now.......seems we are in for a long wait.

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Re: Allofmp3

"What I don't get is its the same film - the actors did no more work, they had to film it in the highest resolution anyway."

They're not preparing for that. They're preparing for the ultra-HD crap that will be sold soon. Yes, they do lose out on the $1.99 very heavily compressed phone video streams, but, no-one in their right mind is going to watch a full-feature film on a fucking two inch screen. Not without losing a good part of their eyesight anyway. Their majority market is the high-def consumers.

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Re: no-one in their right mind is going to watch a full-feature film on a fucking two inch screen

Fortunately for the market, it's full of people not in their right mind that would quite happily sit and watch a feature film on a 2 inch screen. I've seen them do it on the train.

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Re: no-one in their right mind is going to watch a full-feature film on a fucking two inch screen

I've seen them do it on the train.

I've done it myself, albeit on one occasion about four or five years ago.

Found myself stuck on a train which had performed the old British Rail chestnut of stopping between two stations for no apparent reason. All I had to entertain me were vistas of driech, Scottish weather, a set of headphones and a Sony-Ericsson, two inch screened 'phone loaded with only a couple of mp3s, a solitaire game and a few movie files (which I had been transferring between computers using my 'phone's SD card).

I eventually started watching Valkyrie and, despite featuring Tom Cruise, I have to confess that it made the delay a lot less boring.

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Remakes

What's wrong with remakes? I know there's this popular myth that Hollywood has gone downhill since they started churning out remakes, but it's bollocks: they've always done it. His Girl Friday was a remake. The Philadelphia Story was a remake. West Side Story's a remake. A big chunk of Hollywood's golden age was them just remaking old silent films now they had sound. As for the popular idea that they do it to increase guaranteed profits, that simply doesn't hold up to financial analysis: remakes have higher up-front costs than original films (buying one untried script off a writer versus buying licenses for something that has already succeeded) and are far from guaranteed to be hits. Filmmakers -- hard though this is to believe when you see some of the resultant output -- generally make remakes because they genuinely think they can improve on the original. And sometimes they're right: The Next Three Days is one of the best thrillers of the last decade, and The Thomas Crowne Affair and The Talented Mr Ripley are both far superior to the originals.

All that aside, can anyone remind me of the many remakes that Dreamworks SKG have been churning out? Because I can't think of a single one.

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Re: Allofmp3 @ HollyHopDrive

> What I don't get is its the same film - the actors did no more work, they had to film it in the highest resolution anyway. ... The actors/directors/etc got paid the same, the distribution cost difference is negligible and I don't believe the royalties are different either. If they can sell the SD for 6.99 then the HD should be 6.99 and the SD version should not exist. Its this 'taking the piss' that consumers don't like.

It's not taking the piss; it's price segmentation. I thoroughly recommend Joel Spolsky's explanation of it -- it's a long read, but entertaining and funny. The short version is that the price of a product is not really a function of its cost of production. Everyone thinks it is, yes, but it isn't. (If its price can't cover its cost of production, then the product will simply not be made at all, not sold at a lower price.)

A lot of industries have this problem: small cars cost about the same as large cars to manufacture; children's clothes cost about the same as adult clothes to manufacture; but these products have to be priced differently because of what customers are willing to pay. Katzenberg has identified (correctly, I think) an area in which customers will be willing to pay different prices for the same movie. Seems like a sensible move.

Incidentally, your claim that the actors all get paid the same regardless doesn't quite hold. Actors' contracts include clauses that specify what their work may be used for, how it may be released. So, for instance, my father started getting royalty cheques when the BBC's version of The Forsyte Saga was released on VHS, and then more cheques when it was released on DVD, because my late grandfather was in it and it was made before either format had been invented, so his contract and payment only covered analogue BBC broadcasts, so further releases on new formats required further payment. One of the reasons film actors get such huge payments is that film studios don't want to be landed with any such future liabilities, so their contracts specify that their actors' performances, once recorded, may be used for absolutely anything the studio ever thinks of in the future. So, as studios come up with more pricing and release models like this one, actors' agents and managers will take that into account during negotiations and the actors' fees will increase. The existence of higher definition formats that enable people to have home cinema screens certainly does increase the cost of hiring actors.

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Re: no-one in their right mind is going to watch a full-feature film on a fucking two inch screen

i-Spy iWatch wearers

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Hey, Katzenberg

Show me the choice of 576i, 720p and 1080p, all totally DRM-free, and you'll have a buyer.

But if you want to push me to pay a premium for upscaled 480i, compressed to hell DRMed shite - you must be barking mad, man.

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Joke

In related news

Googles stock prices shoots up as analysts revise Google Glass shipments upwards by 1000% post Dreamworks putting their policies into practice.

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Should we pay for adverts as well?

This reminds me of ad execs throughout the last few decades who claim that we should be forced by law to watch adverts and that skipping past them during a recording or ignoring them in any way was somehow criminal.

Corporate Communist Capitalism©®™

Gotta love it.

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Re: Should we pay for adverts as well?

I thought it was funny how W Bush gave some speech in Europe some time ago where he was trying to soothe the European audience by talking about how they would avoid crass consumerism in some bilateral agreement/action. The speech was obviously not meant for domestic consumption as American culture is built on crass consumerism. It also was ironic in that few families in the world are probably more in love of said consumerism. And to head off any partisan battles Obama is probably even worse because he openly lies about not being the corporate Wall St. whore he is.

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Unhappy

Re: Should we pay for adverts as well?

I once tried to watch a catch up programme on the Itv player, all I ended up with was the ***** adverts and never tried the cr*ap option again. If I cannot fast forward through adverts for junk, rubbish or straight false hoods that I will never ever have any interest is buying or seeing again, then I will delist the channel.

Sorry Mr Dream works, I do not know what you are smoking, injecting or drinking but I suggest you go to rehab as soon as possible.

Your output is rubbish and fails to sell due to its lack of merits, I have not been to suffer a cinema experience in more than 10 years, Frankly watching the cr*p at home would take more effort that it could ever possibly justify.

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Re: Should we pay for adverts as well?

"I once tried to watch a catch up programme on the Itv player, all I ended up with was the ***** adverts and never tried the cr*ap option again"

This happens everywhere. I did the same with TenPlay, which is the online catchup for our Channel-10 free-to-air network here in Australia. I had just missed a segment at the end of current affairs type show, so thought I could see it online.

I could certainly fast forward through the program material, but not the ads. And since what I wanted was right at the end, I would have had to sit through 15 minutes worth of ads, just to watch a five minute segment.

I didn't. I would have sat through one ad break, but 15 mintues straight for a five minute segment? Fuck you Channel 10. And the horse you rode on.

Now I record everying on the PVR, and watch at my own leasure. Skipping the ads of course. NOW they know why they're losing money hand over fist.

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Anonymous Coward

Re: Should we pay for adverts as well?

Oh ITV player is crap....

4OD, and iPlayer (and thank you iPlayer for finally letting my listen to radio with the screen off, took you long enough!) are pretty much the only two catch up services I use, other than that I recored of FTA Satellite and transfer to my devices!

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hey Katzenberg

Its a good thing that those that make our hardware don't make our media content for the most part. There is Sony but look what happened to their hardware sales after they start letting the media division set the terms. 15 years ago Sony was where Samsung is today. A cautionary tale.

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Paris Hilton

Why not free to the movie hall so punters might solace up in fine foods, wines, beers, ales, sasperllilas, candies, .. and have a wholesome out of the house and in imperfect human company experience experience?

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Movie business model.

I don't know about the rest of the world, but here in the US, the money paid for Movie Tickets goes pretty much 100% to the Studio and the Distribution chain.

The Theater is already making all it's profit on sales of Candy, Drinks & Popcorn.

And, theater attendance is already suffering from poor attendance because too many people cannot afford the costs. There's not much room for any sort of price increases there.

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Re: Movie business model.

I guess that explains the price of salty corn kernels and sugary water at those places then.

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Re: Movie business model.

Yep in general outside the theaters sugary water is pretty much cheaper in the US than anywhere else in the developed world (and a major source of the fatty epidemic) and the popcorn as well due to the taxpayer subsidizing massive production of corn (and corn sugar) which grows very well here.

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Re: Movie business model.

Most varieties of corn aren't popping compliant. There are just a few varieties that will do it. Regular corn combusts rather quickly if exposed to popcorn corn popping conditions.

There are most certainly lots of corn subsidies here but those are pretty much for all types of corn except popcorn. A farm can certainly receive subsidies for growing popcorn if they want to, but the economics are all screwy. You can make a shit ton more money selling non popcorn corn. The popping corn supply chain is perpetually packed to capacity, so there's no room for new popcorn corn farms. Just thought I would share.

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Re: Movie business model.

Similar here in the UK, we have a small luxury (i.e. leather seats and a well stocked bar) cinema near me I frequent, and one of their 'adverts' before the show starts points out most of the money from the ticket prices goes to the movie makers and they run the cinema with profits from bar sales..

After that I promptly did my duty and brought another pint of beer and packet of pork scratchings!

Seriously they could rise the price at this cinema by £3 and still get people through the door, their prices are lower than the local multiplex, which I always feel like needing a shower after visiting!

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Re: Movie business model.

Yeah that sounds right. Knew all about popcorn being a special variety as well (in addition to sweet corn we eat being different than the field corn we feed the cattle) growing up like I did in Iowa and Illinois (house like a mile away from giant Delmonte packing plant lol) just not as much about popcorn economics. I think most popcorn is grown by a handful of giant corporate ag food companies as well (ConAgra, etc). Still it has traditionally stayed a fairly inexpensive treat but yeah the economics I am sure are screwy like everything else in our weird corporate welfare and socialism but only for corporations economic system.

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And you wonder why they posted a loss...

With bonehead ideas like these, not to mention the previously mentioned crap remakes, it's no shocker that their industry is drying up.

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Re: And you wonder why they posted a loss...

They post losses because they use Hollywood accounting. By any other standard, they're making more money than ever.

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Re: And you wonder why they posted a loss...

@Josh Cain. I suggest you take a gander at the actual money being made here. If you think the industry is drying up, then the bitching, moaning and lying that they've been doing has succeeded admirably with you.

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WTF?

Maybe the viewers should be based on the size of the content producer's ego?

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MrT
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So long as...

...we can countercharge for when the movie turns out to be derivative formulaic bollocks, with an additional penalty for all the drip-feeding to rabid press droolers who fawn over every snippet (especially "character posters" and casting rumours) and who would declare a polished turd to be the best thing ever.

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Re: So long as...

Thanks, you just reminded me of the new Star Wars remake. If it's even half as bad as ST though...

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Re: So long as...

Talking about movies or Obama? Everything you said can be attributed to Him too.

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Re: So long as...

Why single out the current US president?

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Re: So long as...

Just a guess but isn't he the guy who said he was going to change the way government does things and then stuck to the script of the last clown in charge? Yeah, I know, the more they claim they are different the more they remain the same.

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Re: So long as...

Eddy Ito gets it +1

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Re: So long as...

So, every almost politician ever then?

(This is not a defence of Obama).

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Dear Mr. Katzenberg

May I kindly suggest that you fuck right off.

Here's your first problem: What size is the screen if I'm using a projector? And it's all downhill from there.

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Trollface

Re: Dear Mr. Katzenberg

Laser range finder as a required piede of hardware drm in projectors?

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Re: Dear Mr. Katzenberg

My smart phone has a Micro-HDMI port on it and I can connect it to a large TV, what size does that count as?

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Re: Dear Mr. Katzenberg

I'm guessing by 'screen size' he actually means pixel resolution of the video file. I can see where he's coming from, I wouldn't really want to pay the same for an SD movie I'm watching on a 7" tablet whilst travelling as I would for an Ultra HD movie I'm watching at home. However this value analysis depends upon a tiered pricing model. I suspect the movie industry would make a lot more money if they offered a 'buy once at a reasonable price, download at any resolution whenever you like' option.

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Re: Dear Mr. Katzenberg

"My smart phone has a Micro-HDMI port"

The DRM will require that this be turned off.

There will be a different player for each of the studios that go for it. Each will only work with a different set of 5 devices. Like 'Plays for Sure" it will be killed after a couple years and anyone dumb enough to buy anything will be SOL.

They come up with crap like this, UltraViolet, digital copy... remember the DIVX DVD phone home player? The self destructing DVD? From the same people who think putting the "you wouldn't steal a car" ad on a DVD (unskippable) that someone just bought is a good idea.

And they moan when we tell them to pull the other one and mock their great ideas.

Tell them we want DRM free, just like music and they act like we ask them to do something impossible.

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Re: Dear Mr. Katzenberg

"From the same people who think putting the "you wouldn't steal a car" ad on a DVD (unskippable) that someone just bought is a good idea."

Featuring background music that they themselves had stolen no less.

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DRM by the backdoor

Smells worse than a month old dead crab to me. Presumably Jeff will soon be back to explain that TVs will need to incorporate a "tamper-proof" way of ensuring that a film bought at one size can't be simply upscaled. Because otherwise home-taping torrenting upscaling will mean the end of Hollywood.

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Sort of Reasonable

Although I'd rather not see DRM get any worse, this notion is actually not too surprising.

It falls in line with standard market segmentation practices; it does stand to reason that someone who was going to watch a movie on a smartphone wouldn't be willing to pay as much for it as someone wanting to watch the same movie on a fancy home theater. In the former case, a cheap price makes sense - in the latter case, the price for a download should be about the same as the price for a DVD.

But will monitors have to be redesigned to report their sizes to the computer they're attached to? So if anyone wants a discount for having just a 15-inch monitor, it would only apply if the monitor was bought after 2017? In that case, the notion becomes ridiculous.

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MrT
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Re: Sort of Reasonable

Monitors do that already, at least Plug'n'play tells the graphics card what the monitor can handle. The problem comes when my 17" laptop has a higher res than my 32" Sony, and a 10" Nexus tablet can beat both by some margin...

It's unworkable.

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Re: Sort of Reasonable

"It falls in line with standard market segmentation practices"

Declaring a crook still a crook does not mean it's an improvement, or a thing we should embrace.

Though thankfully, some do still produce good content for a good price and no chase down all potential customers as criminals (those left are diminishingly small now though).

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Stupid

How about just charging differently for different resolutions? Wouldn't it be simpler? No need for tying the video to the device, or complicated system to check the size of the device?

Muppet.

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Re: Stupid

Totally in agreement. If you have a 90inch TV and want to ruin your experience by watching a 480x320 video the choice should be yours. You may have a valid reason for watching content at reduced resolution (say in a window) while viewing something else that fills the rest of your 4K screen.

Likewise if you are total dork and want to dowload 4K video to watch on your 800x600 phone screen so you can boast to your mates, then more fool you.

Payment should be by the resolution you receive not how big you can make individual pixels.

Mines the coat with a phone with built in projector in the pocket.

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Anonymous Coward

Re: Stupid

Well of course that makes sense, but not for what he wants, which would seem to be sneaking in some form of DRM, by making your screen (whatever version it is) their ally.

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Re: Stupid

Not only is resolution based charging easier to implement its even vaguely justified by the higher costs of storing/streaming more data to you (although as someone else pointed out the cost of making the film in the first place doesn't change).

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