Three Hundred and Thirtieth Chapters Planning Film Source

Thanks to licensing agreements with several entertainment companies in South Korea and island countries, Netflix's film library has been enriched to a certain extent, but the source of films is still seriously insufficient.

Compared with now, Netflix used to have fewer film sources. Due to many factors such as funds and latecomers outside the Hollywood circle, Netflix had very difficult contact with copyright owners at that time, and had to find a way to collect film sources.

Among them, there are a considerable number of very large-scale art films, even reaching the level of prohibition for viewing under the age of 18.

Most of the authorizations for these films come from the famous San Fernando Valley.

However, among the art films in the San Fernando Valley, they belong to the relatively small type.

"I hope this part of the film can be removed." Ronan is not because of any moral issues, but based on future considerations: "We can get enough authorizations this year, there is no need to take this risk."

Relativity Entertainment has been making preparations in this regard since the acquisition of Netflix, and it is already ready.

Mark Randolph said with a little helplessness: "We know that this is risky, but this is no way for Netflix before."

Many companies' entrepreneurship and early development are not standardized, and sometimes they use special means. Ronan was also one of them, so he can naturally understand what Mark Randolph said.

"Netflix has passed the most difficult stage, let's withdraw now." Ronan said jokingly: "I don't want to be dragged into court in the future and accept some kind of covert behavior accusation, and the cause is just somewhere Prosecutors are behind in the polls and want to use that as an excuse to draw attention."

"Okay." Mark Randolph believes that Ronan can bring enough film sources to Netflix.

Ronan has learned more about Netflix lately, and also knows that Mark Randolph and Reed Hastings made many risky moves in the early days of Netflix, some of which were more extreme than this one.

For example, in order to attract users, Mark Randolph and Reed Hastings put their ideas on Zipperton and Lewinsky, and burned Zipperton's inquiry and grand jury testimony into DVDs on the Netflix website. , which attracted more than a thousand new signups and sold thousands of DVD copies.

This was a successful operation for Netflix at the time, but the political risks involved were extremely high.

In addition, according to the later records of the distribution room, because Netflix had just included a batch of art films in the San Fernando Valley,

As a result, shipments went awry, and hundreds of customers received DVDs of hit art films instead of Zipperton's testimony.

Fortunately, the customer who received the wrong movie chose to remain silent. Otherwise, if someone complains to the regulatory authorities, Netflix will face very big trouble.

In the second week after Ronan came to San Jose, Relativity Entertainment’s second tranche of 30 million US dollars was in place. The capital increase and share expansion was led by a special person under the leadership of Mary. He didn’t need to be too distracted, and his main focus was on cooperating with Netflix’s management Solve key issues above.

Netflix plans to expand the "Sky Screen Project" that was being promoted before, that is, customers can become paid subscribers of Netflix for a monthly fee of 14.9 US dollars. They can choose 4 movies per month, and Netflix is ​​responsible for the postage.

This plan was formulated as early as 2000, but the promotion was not smooth, mainly due to film library and funding problems.

"If there is a large enough film library, with appropriate publicity and promotion..."

In Netflix's somewhat cramped conference room, all executives gathered together, and Mark Randolph, sitting on Ronan's left hand side, said loudly: "Project Canopy can bring huge customer growth to Netflix."

"We're reaching out to the media," said Leslie Kilgore, head of marketing.

At this time, Luo Nan answered: "The head office can assist in the promotion. There is an Internet Propaganda Department under the embassy film industry. They have rich practical promotion experience and can promote Netflix on major film and television websites. In addition, I have asked people to Contacted film and television media and portal websites with a wide audience, such as "Premiere", "Variety Show", "Entertainment Weekly", "Vanity Fair" and Yahoo.com, etc. Relativity Entertainment has had good cooperation. When Netflix is ​​ready, There will be a wide range of Netflix ads."

His words continued: "Netflix also has room to use in the publicity and promotion of the new film Theory of Relativity. I will let people contact you and negotiate a deal. If Netflix has enough users, I can make Netflix become some big The only online rental and sales company that sells movies."

"I have no problem." Leslie Kilgore suddenly felt that his marketing work was more than half easier. Is this the opportunity brought by the support of a big platform? It is much better than Netflix's dull development. Her confidence doubled instantly: "I will fully cooperate with the head office."

Mark Randolph went on to say: "The most important issue we need to solve in the next stage is to reduce costs! Once the Sky Screen Project is fully promoted, if it is still at the current cost, we will only incur more serious losses."

Tom Dillon, who took over as chief operating officer, said: "Our main model is still at the stage of charging a rental fee of $4 per disc and a shipping fee of $2. Each order costs up to $6.50."

It was very quiet in the conference room, and everyone knew what that meant.

Mark Randolph said: "Our goal is to reduce the cost of a single order to $2, so as to ensure the success of Project Canopy."

Tom Cook said: "Among the costs, the delivery fee is not a high proportion. At this stage, it is impossible for us to keep the single-piece shipping fee lower than $2."

Leslie-Kilgore said: "The real cost is the DVD purchase fee, and the related licensing fee. The average purchase cost of Netflix's DVD is $15 per copy, which is the lowest price that the distributor has given us. "

Ronan said directly: "The cost of DVDs for new films can be reduced to about 10 dollars, and the cost of old films will be even lower."

Embassy Pictures has the ability to distribute DVDs, and the cost of converting and printing DVDs on site is less than US$3 per copy on average, and with the advancement of technology, the price has shown a trend of decreasing significantly.

"During this time, we have been in contact with the six major Hollywood companies." Leslie Kilgore glanced at his colleagues. After Netflix was acquired, they also wanted to make some achievements as soon as possible to show the new boss. It also proves the ability of the original management, but the most important aspect of DVD authorization is quite unsatisfactory.

"They're not changing the $15 wholesale DVD price, telling us it's absolutely not going to work, saying they'll give us the DVD and the license, but don't expect any discounts," she said.

This is no different from Hollywood's previous attitude towards Netflix. If Netflix can obtain the authorization at a high price, it will not be delayed until now.

Ronan asked, "The old movie is the same as the new one?"

"Yes," Leslie Kilgore replied. "They're very arrogant, like Blockbuster."

Ronan has dealt with Blockbuster too many times, so he naturally understands Blockbuster's situation. The arrogance caused by the long-term monopoly position has caused customers to increasingly resent the chain giant's late fees, limited selection and poor customer service.

The six major Hollywood companies have monopolized the North American film industry, especially the vast majority of copyrights, and they both compete and cooperate with each other, and have tacit and consistent interests in many aspects. Difficult.

However, it is impossible to give up Hollywood film authorization. After all, this is North America. No matter how many overseas authorizations are obtained, it cannot change the reality that the main audience of film and television works is Hollywood.

"Let's hand over the licensing negotiations with Hollywood to the head office." Ronan made preparations when he acquired Netflix. Companies are tough, and it’s not easy to get them to cut prices.”

Everyone at Netflix is ​​aware of this, after all, they have seen the arrogance of big companies in recent years.

Ronan thought of Robert Iger's suggestion. If Relativity Entertainment has a huge film library, these are actually easy to solve. The interests of the industry are intricately entangled. Each of the six major companies has peripheral channels. If there are enough film copyrights, mutual authorization Under the circumstances, in fact, Relativity Entertainment can obtain the relevant authorization without much effort.

The problem is that in Relativity Entertainment's movie library, including Shahai Entertainment's previous videotape movies and the movies that Embassy Pictures has bought from overseas in the past few years, there are only more than 20 movies.

At the end of the meeting, because of Ronan's relationship with Relativity Entertainment, almost everyone is very optimistic about Netflix's future development.

But Ronan knew that buying Netflix was just the beginning.

Excessive cost is one of the key issues that must be resolved as soon as possible.

In the office, Mark Randolph told Ronan: "We still have a lot of problems."

Ronan asked bluntly: "Mark, don't you think that once we solve all these problems, we will create a particularly high barrier to entry for this industry? It will make it impossible for potential competitors to enter in a short period of time." This industry, especially Blockbuster and Hollywood Video, which holds the licenses of many film and television works, is a chain giant."

Mark Randolph can imagine that if two years earlier, companies like Blockbuster and Hollywood Video decided to develop Internet businesses, Netflix would not be competitive at all.

"That's right!" Mark Randolph, as always, is full of confidence in Netflix: "In this industry, no one can catch up with us!"

He looked at Ronan: "Do you have a plan for authorization?"

"Frankly speaking, even if Relativity Entertainment is a member of the industry, it is difficult to talk to the Big Six." Ronan did not shy away from this point: "The cost of a single movie is not high, but we cannot have the opportunity to choose at will. Large companies have huge film libraries, so they will inevitably use the method of packaging and licensing."

Pairing good movies with bad ones to authorize is a common method in Hollywood, and Ronan did not do less.

Starting from himself, Ronan said: "One more thing, we talk directly to the Big Six. Besides these, we also need to buy DVDs from them, which will cost even more."

No matter how many DVDs you buy, as long as you use them for your own use, there is no problem, but if you use them for commercial operations, you will need to pay for them.

Although it was difficult to say it, Ronan was very calm: "The theory of relativity has begun to work."