As they say:

The goal of YouTube Partner Grants is to act as a catalyst by infusing additional funds into the production budgets of a small group of YouTube partners who are at the forefront of innovation. Funds from YouTube Partner Grants will serve as an advance against the partner’s future YouTube revenue share. This additional funding can allow partners to invest in better cameras, achieve higher production quality, expand their marketing efforts, expand their staff, or just hire more talent. Anything that will help them evolve their art, business, and ultimately the entire creator community. We look at this as an investment that will bring an even richer body of content for our users and advertisers and raise the creative bar for online video.

So it’s more of an advance on advertising revenue than a grant, but still, it should help that “select group” to improve their product.

Kara Swisher goes to meet with Hollywood Executives who are all looking for a Golden Ticket (Willy Wonka reference) so that they can charge the same monopoly rents they did when they (used to be) a monopoly.

Michael Masnick deconstructs Swisher’s reporting and parses it for us. This is a worthwhile read, even if a little long.

From music to movies to television, the biggest minds here still sound perplexed as to what will finally be the golden ticket to carry them through to the inevitable next era of digital distribution.

That single sentence basically describes the problem. These guys are sitting back and waiting for someone to hand them a golden ticket that replicates the old ways of doing things. That’s not how it works. No one gave the buggy whip makers a golden ticket that let them keep their old lines of business going.

The unnamed executives even ask why the customer always gets to be right. Yep, that’s how far removed they are from any sense of commercial reality. The customer is always right because there’s always someone else that will meet the customer need if you don’t. (Where is my “any program, any time, any device for a fair price” service again? There’s a customer demand for it but the old guard won’t deliver.)

Final words:

The role of the disruptor is not to make life easy for the disrupted. Swisher and these execs seem to be confusing the role of certain folks in the legacy industry with the overall entertainment industry itself. As noted, the entertainment industry is thriving. More movies, music and books are being created. More money is being spent. It’s just that it’s going to different players. There’s no reason to “figure out a way to keep talent from being dragged into the future.” The opportunities and wide open path are there. The problem isn’t that tech leaders haven’t made it easy for them. They have. It’s that these guys are so myopically focused on the way they used to make money they don’t realize that the new opportunities are already there and have been embraced widely by others.

First off iAds go in Apps for the iPhone/iPod Touch/iPad – or they will from early next month – and are an integral part of iOS 4. Any developer can add ads to their App simply and 60% of the revenue from ads goes to the App developer (or owner). That’s $36 million that’s going to be paid out to someone, why not your independent project?

I’ve long thought that the future of programming was Apps. An App, like a website, gives a single place for everything about your project: blog, previews, special content, upcoming events, merchandising etc. The advantage of not only having a website, but wrapping it an App is that the App will be a better fan experience, and it’s easy to add in-App purchasing of digital goods.

So, create an App for your project. This App will have:

• An area where you can read the production blog;
• Forums and chat around your project;
• The Twitter feed from your project;
• Connection into your Facebook presence;
• Previews of scenes or trailers of movies;
• The full project, with a little in-App purchasing (or not).
• Calendar for screenings, parties and other events around your project, including signup (filtered for just the geography of the fan if they want, thanks to GPS on most of the devices)

Having everything to do with your project in a mobile app on iPhone or iPad makes it much easier for your fans, friends and followers to stay involved and participate. Involvement will improve. (Connecting with Fans and giving them a reason to buy is a basic tenet of independent production in the digital era.) Plus fans will likely be clicking on some of those ads if they’re well targeted, bringing revenue to the project.

Plus, there a minor security advantage. There’s no download function in Mobile Safari and Apps can’t download very much. Plus there’s no way to actually get anything downloaded within an App out of the App to a computer. That means your finished, high quality version could be viewed in the iDevices without much risk of it being distributed without authorization. (Recognizing though, that it will get distributed unless you project just plain sucks!)

Who’s going to be the first to give it a try?

This is a custom version of my “How to grow your production or post-production business in any type of economic conditions”, which has been presented in New York in March, and will also be in San Francisco on June 19. (Along with an afternoon session on “Growing and Monetizing and audience for your independent production”.

Your personal brand defines how people perceive you: what work they’ll consider you for, what you get offered. You’ll learn how to manage your brand – and the stories you tell around your personal brand. You’ll learn how to build an internet presence by understanding how marketing, PR and social conversations have changed the business promotion and networking landscape. We will conclude with the top tips on maximizing your business’ visibility on the Internet.

• KNOW WHAT BUSINESS YOU ARE IN – IT’S PROBABLY NOT THE ONE YOU THINK IT IS
• HOW TO CLARIFY YOUR PERSONAL BRAND – WHO ARE YOU, WHAT DO YOU STAND FOR AND WHAT PROBLEMS DO YOU SOLVE?
• UPSCALE YOUR MARKETING, PR AND SOCIAL CONVERSATIONS TO GROW YOUR PERSONAL BUSINESS AND PROJECTS

MAXIMIZE YOUR VISIBILITY SO PEOPLE CAN FIND YOU TO GIVE YOU WORK

Stereoscopy is indeed a trend in feature film production with an impressive percentage of last year’s box office attributable to 3D movies, but it will be a long time before it’s more than a niche for non-feature production. In fact the supply of 3D content vs the number of theaters equipped to display, is probably going to limit 3D distribution to the major studios and their tentpole releases.

That said, this year’s NAB is likely to be full of 3D capable rigs, cameras and workflows. For what display?  Until the viewing end is more established production in 3D won’t be that important.

Right now the trends I’m observing are: more multicamera production; extensive use of green screen even for “normal” shots; 3D sets, objects and even characters; and a definite trend toward larger sensor cameras (both DSLR and RED).

Multicamera Production

The appeal is simple: acquire two angles on any “good” take. Of course reality television takes this to almost-ridiculous levels with up to 68+ hours recorded for every day of the show’s shoot. On more reasonable shows, Friday Night Lights shoots multicamera in real world locations for a very efficient production schedule.

While it no doubt saves production time, and therefore cost, it can limit shot availability (as one camera ’sees’ another) or more bland lighting (to make sure each camera angle is well lit). Multicamera studio shoots – the staple of the sitcom – tend to be lit very flat, but Friday Night Lights doesn’t suffer for the multicamera acquisition.

All major editing software packages support multicamera editing. We’ve also seen an increase in requests for multicamera support in our double-system synchronizing tool Sync-N-Link.

Part of the reason that multicamera acquisition is becoming more practical is that the cost of buying or renting camera equipment has dropped dramatically, so that three cameras on a shoot are not necessarily a budget buster.

Green Screen (Virtual sets)

If you haven’t already seen Stargate Studio’s Virtual Back Lot reel, do it now. Before seeing it I had the sense that there was a lot more green screen used out there, but I had no idea that shows I’d watched and enjoyed employed green screen. The Times Square shot from Hereos, for example, did not feel at all composited. When simple street scenes are being shot green screen – things that could easily be shot in the real world – then you know it has to be for budgetary reasons.

Green screen (and blue screen for film) technologies are well proven. There are good and inexpensive tools that fit within common workflows to build the green screen composite. In other words, the barriers to entry are simply the skill of the Director of Photography on the shoot, and that of the editors/compositors in post.

When 70% of a show, like Sanctuary uses virtual sets, the necessity for anything beyond a good screen screen studio, with a good lighting kit and some smarts seems less important.

3D sets and enhancements

The third major trend goes hand-in-hand with the use of Virtual Sets: sets that are created in the mind of a designer and rendered “real” with 3D software. There are literally hundreds of thousands of object models available for sale (or free) online. You can hardly read a production story now that does’t feature 3D set or character extensions.

I should probably add motion tracking as another technology coming into its own, because it’s an essential part of the incorporation of actors into 3D sets, or the enhancement of character with 3D character extensions.

Larger Sensors

Fairly obvious to all, I would think, but the trend toward larger sensors includes the DSLR trend as well as RED Digital Cinema and the new Arri Alexxa. Wherever you look the trend is toward larger sensors with their sensitivity improvements, greater control of depth of field and drop-dead gorgeous pictures. Among other uses they make perfect plates for backgrounds in green screen work!

All four (plus motion tracking) trends contribute to reducing production cost, making more shows viable with ever fragmenting audiences.

In conjunction with the New York based MoPic group and Boston’s Final Cut Pro User Group, Intelligent Assistance’s Philip Hodgetts will bring his business development and new media seminars to the North East for the first time.

These seminars have been among the most popular at the recent Digital Video Expo and have attracted crowds of interested people in San Diego and Los Angeles. Now New York and Boston get a chance to experience world class presentations.

“Now more than ever business owners need to know how to grow their production or postproduction business,” says presenter Philip Hodgetts. “This seminar is based on my book from last year The New Now. It summarizes the most practical advice into a interactive seminar.”

In an age where the democratization of production tools is almost complete people have turned their focus on equivalent democratized ways of growing audiences and making money from their work. In the How to grow and monetize and audience for your independent production independent producers will learn how to identify their core audience, grow the audience through social media and modern PR before understanding the many ways that producers earn a return from their independent production.

“The [MediaPro Camp] Day was capped off by a keynote address from Media Guru Phillip Hodgetts. He is a true Renaissance Man of the media. If you have ever been to one of his seminars, read one of his books, or his blog or heard him speak, you know what I mean.”

- John Coleman, at MediaProCamp San Diego

In conjunction with the The Moving Pictures Collective of NYC both seminars are being offered in New York sponsored by AJA Video Systems and Video Corporation of America. The seminars will be held at VCA’s facility on 7th Ave, one block from Penn Station on Saturday March 20th. Details and signup can be found at http://mopictivehodgetts.eventbrite.com/.

In Boston Hodgetts has joined with the Boston Final Cut Pro User Group to present the How to grow and monetize and audience for your independent production on Tuesday evening March 23rd at The New England Institute of Art. Details can be found at http://newnowboston.eventbrite.com/.

About Philip Hodgetts (as if you didn’t already know)

Philip Hodgetts is an expert and consultant in digital production and post-production workflows, encoding, web applications, digital delivery and technology innovation. He is the President and CEO of Open Television Network, a company dedicated to democratizing distribution through monetized RSS feeds.

He remains President of Intelligent Assistance, Inc – a systems and technology developer – and one of the “Big Brains” of “Big Brains for Rent” consultancy. He is an experienced trainer and has written extensively online across a range of topics.

He is the co-creator of “Assisted Editing” and an expert on metadata-based postproduciton workflows.

Philip is the author of “The HD Survival Handbook”; “Awesome Titles with FCS” and “The New Now: How to grow your production or postproduction business in a changed and changing world” among other publications.

He has presented at many conferences and seminars including Keynote addresses for the New York DV Show; Academy of Television Arts and Sciences’ NEXT TV symposium in 2006; and the 2007 Podcast Summit at NAB as well as presented at Streaming Media East and West; NAB Post|Production, Seybold among others.

“Another primary theme, from both Scott and Peter, is that the distribution for every project will be different, because the primary (or starting) audience will be different and what attracts one audience will not attract another. In modern distribution the “primary” audience for any project is one that is already engaged, in some way, by the topic or content. That helps get word-of-mouth buzz going and the audience can spread. Targeting a specific audience is easier (and cheaper) than trying to build a generic audience.”

Then I come across an IPTV Evangelist post by Levi Shapiro titled “The Only Successful Model for Indie Film,” which naturally caught my attention. While I’m not convinced that there is only one model there are some nice parallels drawn for the modern era of distribution from models of the past: what is the modern equivalent to the ‘Miramax’ model of the 1990’s. Number two on their list for modern distribution is this:

2. Nurture a built-in audience: “The film was supported by the army from the beginning. We asked for their help and advice, they read the script and said, ‘Yes, we want you to make this movie and we will help.’ So they gave us access to a base to shoot, and we had a full-time adviser on the set. So we knew that officially the army as an institution was behind the movie.”

Now I think I’m beginning to see a pattern when along comes an uncredited post on the (highly recommended) Future of Movies blog titled “A Target Audience means a Better Box Office.” This whole post is well worth reading because it really accurately sums up the issue:

Let me repeat that key phrase from the quote: ‘…you have to make the movie for someone. Movies that are for a specific audience tend to overperform.’

After a little slam on “personal movies” (I’m just making it for myself!) the post goes on to note that metaphoric Hollywood makes “movies for everyone.” But it is the answer to the question “Who is your Audience?” that cuts to the heart of the subject:

“If you say everyone, you are either kidding yourself or better have about $300 million to make the next Avatar.

If you say the audience is yourself and forget the audience, you should just stay at home and not waste your investors’ money.

However, if you can create a project that speaks to an audience – a specific, identifiable audience then your story can be focused, your casting choices should make sense, you trailer will talk to that audience, and the film will entertain them and have them sharing and Tweeting and Facebooking and Rotten Tomatoing all over the place.”

All that “tweeting and Facebooking and Rotton Tomatoing” is what independent productions need to grow their audience. This is the crux of social media marketing: give your target audience something they love and they’ll spread the word for you. From among these people will come your fans – those few who actively promote the show.

If you consider some of the more successful independent productions – documentary or not – you can see the wisdom of this approach.

For One Six Right – a documentary about “the passion of aviation” focused on LA’s Van Nuys airport – the target audience is the body of pilots. Pilots have magazines and website dedicated to them making it easy to reach out to the audience.

2004’s Napoleon Dynamite’s target audience – the first people interested in viewing – was clearly people like me: nerds! Yes, it was fortunate and crossed over to the mainstream because the movie was entertaining and the word of mouth spread. But without that first audience tweeting and telling their enjoyment of the movie, who would have been interested in one nerd helping another nerd win Class President?

When Joss Whedon needed a project to fill in time during 2008’s writer’s strike, he pulled together Dr Horrible’s Singalong Blog. While appealing to SciFi fans the “first audience” to get that all-important word-of-mouth going were Joss Whedon, Neil Patrick Harris or Felicia Day fans. OK, we can’t all get that sort of head start, but do note that it wasn’t made “for everyone.” (Joss Whedon’s work is always targeted to specific niches.)

When  Aaron Woolf was looking to promote King Corn (a documentary about how damaging subsidies on corn farming has been) he chose to find their first audience through blogs about sustainable agriculture and slow food movement.

Robert Greenwald ’s audience came from MoveON.org where he was an in-house filmmaker.

And so it goes. By focusing on a target audience – a niche if you will – the marketing becomes clearer and more focused. By saying “no” to the rest and targeting and appealing to the target audience, how you reach the audience becomes clearer and more practical.

When we were creating the Intelligent Assistants for various post-production software programs, I had a very clear audience in mind. In fact, I could probably name the half dozen or so people that I was writing for. They never knew it, but it was easier for me to write something that really met the needs of those people than something aimed at “everyone” using Final Cut Pro or Boris RED, et al.

During the years I was programming the Digital Production BuZZ I again had a very specific group of people that I was programming for. It was clear in my mind who I was not programming for. That made it much easier to determine who would be an appropriate guest for that audience, keeping it relevant and focused for those few and contributing, I believe, to its rapid growth.

You can never make an audience for “everyone”. The market for Predator has very little overlap with Princess Bride! To some degree Hollywood has semi-targeted specific demographics. But demographics aren’t people.

When you talk with me about promoting your independent project (as I will be in New York on March 20th and Boston on March 23rd) expect to be challenged with the question “who’s your target audience?” to clarify any questions. If you can’t define your target audience – the first you’ll promote to – you should stop everything and refine the project until it perfectly meets the expectations of a single, first, starting audience.

Then you can start production.

This is absolutely a step in reality’s direction but it still prices individual programs at well above the traditional income-per-viewer that networks have traditionally received, and way above what it would cost for an average viewer via a cable or satellite subscription.

At 99c, the content owner would get 65c per download as Apple take 35% and pays for the bandwidth (at about 10c a GB).

65c per viewer per show is right at the top end of what the big four networks have been able to command from advertising: per show, per viewer. (Even the Superbowl only gets 85c average per viewer per 3 hours show).  At the other end, the big four get a low of 25c per viewer per show.

But not all television is “big four” nor is it always worth the network premium. Take one of my favorite shows: The Daily Show with Jon Stewart. The best research I can find is that Comedy Central pays Stewart’s company about $5 million a year or $32,000 each for the 160 shows a year that are produced. The Daily Show has an audience of around 1.5 million viewers according to Wikipedia and other sources. Cost of production to Comedy Central is just about 2c per viewer.

Presumably Comedy Central are turning a profit between the 60c per subscriber per month they get from cable carriage and whatever advertising revenue is generated across the 5 or so showings of each episode.

And yet, through iTunes that show is currently $1.99 or 99c per episode if you buy a season pass for 20 episodes. (One of the few cases where a season pass gives significant savings). It’s still too much.

If Jon Stewart’s company sold direct through iTunes at, say, 10c an episode (because once watched it has little future rewatching value, unlike episodic drama or comedy) then gross revenue would be $150,000 per show or $97,500 after Apple’s cut. (Apple’s bandwidth cost would be around .6 of a cent in SD, or $8550 leaving Apple $43950 gross profit on the sales.)

On the other end of the equation, the content creator (Stewart) gets $97,500 or three times the income for the same show as working for Comedy Central brings.

So, while 99c TV shows are a step in the right direction there’s still a long way to go before Internet, on demand, video reaches fair price parity with traditional revenues. This is not an opportunity for the existing entrenched players to dramatically increase their margins: it will kill the nascent future.

In the (relatively brief) period of mass media – Television, newspapers, magazine and radio – the publisher or license holder built an audience and then sold that audience to advertisers to push unrelated products and services to the audience who mostly didn’t care. With 70% of Americans desirous of paying to avoid advertising (counting me among them) you have to wonder how long the tedium of irrelevant advertising will be tolerated by audiences.

Even the web is a horrible experience unless you are smart enough to enable ad blocking and Click2Flash (Flash blocking in webkit displays system wide – OS X only afaik). With those two add-ons enabled the web doesn’t burn my eyes with the pain of flashing, jumping, irritating distractions. If my failure to ruin my experience of a site by blocking the ad sends the site off the net, so be it. I didn’t ask for the advertising.

Technically, of course, it’s not all advertising that’s horrible, just irrelevant advertising. Like watching a 45 minute show on Hulu and seeing the same fabric softener ad five times!!!! And Hulu has the temerity to complain that I’m using ad blocking! People don’t really mind relevant advertising, but so little of it is! In fact, for me about 99.9% of advertising is irrelevant. In maybe 200-300 hours of in-car listening to KNX1070 (LA News radio) I’ve heard one ad that was relevant (Windscreen chip repair). That is the only ad that doesn’t carpet KNX wall to wall! (Figures!)

So, I have a fairly hard-and-fast rule that I don’t buy from anyone who advertises to me. Send me junk mail, go out of my purchase consideration list.

Anyhow, I’m not alone. Not only is advertising losing its effectiveness, it turns people off (and yes, I have references for every assertion I make, I just don’t want to clutter the blog) and that’s just not going to be a way to build an audience.

But there’s a much bigger problem. There’s not enough advertising for any “new media” and “old media” is losing advertising support in dramatic amounts.

But most relevant of all. Advertising in someone else’s show makes no sense. The biggest advertising brands would be much better off with branded entertainment, where they would pay for the content and integrate the advertising. American Academic Mark Pesce, now at the Australian Film, TV and Radio School, coined the term “Hyperdistribution” where a single sponsor integrates ads relevant to the show’s audience and in the style of the show, and then it’s distributed anywhere and everywhere it can be. P2P and Bittorrent distribution is welcomed!

My friend Cirina Catania worked on a very successful series of branded media (online video) for Chivas Regal and I believe that this is the direction of the future: useful, interesting content that is, in some way, relevant to the brand and hooked back to the brand. Why torture audiences with irrelevant advertising when you can entertain them and still get the brand message across in a relevant way?

I’m clearly not the only one that thinks this. I recently found a great presentation called (correctly) The Audience is always right. Check it out and then make a comment.

On the other hand, even the threat of a three strikes law in France (ultimately struck down by their highest court as against human rights) immediately created a business opportunity for encrypted Virtual Private Networks (VPN). Not only that, but the Pirate Bay folks are also setting up an inexpensive VPN service for anyone that wants it. These services disguise the IP address of the downloader, so even if copyright owners tried to get an IP address to sue (not that you can sue an IP address, as many have found out in non-US jurisdictions) everyone using the service has the same IP address, not correlateable to any individual location. 

If that should ever become “broken” as a workaround, something else will be found. In fact there’s a move afoot to update the bittorrent protocol to a new form that resists seeders being identified.

It’s a pointless exercise. Whatever horse there was has long bolted the stable and the only reasonable response from an intelligent business person is to find new business models. Andy Kessler, writing at Forbes.com, discusses The Inevitability of Internet Pirates: 

Hand out as many guilty verdicts as you like, but folks on the Internet will copy away–because, really, who can stop them? Google won’t do it, Internet providers like Comcast ( CMCSA -news - people ) and AT&T ( T - news - people ), who can block a lot of this stuff, can’t do it without Network Neutrality proponents squawking, “Interference!”

Even authoritarian regimes fail. (The Great Firewall of China is quite leaky.) Plus, it is so easy to create a Web service to download copyrighted material that, like that arcade game Whac-A-Mole, if you take one culprit down with your mallet another five pop up in the next few nanoseconds. Sad but true, there is not much anyone can do.

Blocking sites does not work because it’s relatively trivial to find a proxy server to log into the “blocked site”. DRM has been an abject failure inconveniencing those who actually paid for the product without doing anything to reduce “piracy”. 

Piracy is such a daft word for infringement – a civil or business problem, not a criminal one. With theft of property, the original owner is deprived of ownership because the thief has taken it. Not so with a digital copy where millions can be produced without anyone being deprived of anything (other than potential, not actual, income). The copyright industry likes to use the word “theft” or “stealing” but it’s disingenuous at best and an outright lie in all likelihood. (As are the outrageous guesses at “losses” that make the ridiculous assumption that every download is a lost sale at a premium price, none of which is supportable by fact.)

Not only is it inevitable, but it’s not in the best interests of the content industry. As I’ve noted before, those who do pirate music are also the music industry’s best customers. Apparently the pirating is a way of testing new music that otherwise would never have been heard, appreciated and ultimately purchased. 

Not only that but a new Harvard study shows clearly that it’s in societies best interests to have weak copyright. Remembering that the writers of the Constitution of the USA reluctantly granted “limited” exclusive copyright in return for encouraging creative work.

Copyright law was never meant to protect the music business in the first place—instead, it’s intended to foster creative production in the arts. It seems that goal is fostered by weak copyright and file sharing. 

The idiot copyright industry keeps saying that nothing would be created without ever stronger, and longer, copyright. This is another lie that bears no relationship with any fact or research, but that doesn’t stop the IRAA and MPAA making the claim. (Heck, they simply change their story to suit whatever action they’re currently taking to prop up outdated business models – every action that is, except updating their business models.)

The Harvard Study, analyzed by Michael Geist (the original is a pdf and harder to link to or quote) has found that file sharing has significantly increased cultural production. 

The paper takes on several longstanding myths about the economic effects of file sharing, noting that many downloaded songs do not represent a lost sale, some mashups may increase the market for the original work, and the entertainment industry can still steer consumer attention to particular artists (which results in more sales and downloads).

And this:

The authors’ point out that file sharing may not result in reduced incentives to create if the willingness to pay for “complements” increases.  They point to rising income from performances or author speaking tours as obvious examples of income that may be enhanced through file sharing. In particular, they focus on a study that concluded that demands for concerts increased due to file sharing and that concert prices have steadily risen during the file sharing era.  Moreover, the authors’ canvass the literature on the effects of file sharing on music sales, confirming that the “results are decidedly mixed.” 

It’s time the MPAA, RIAA and their international associates, who do NOT really represent artists, simply realized they were flogging a dead horse and the only chance they have for a future is to adapt. Ever more draconian laws that turn almost every citizen into a civil offender (or worse a criminal) is not only stupid, it’s not in the best interests of those who create the content. Something many musicians have realized already.

Any chance of at least one politician understanding the argument? I didn’t think so.