The Best Entertainment Era

Culver City, Los Angeles, California, is a satellite town that closely combines nostalgia with current trends. Like Burbank, it has gathered many Hollywood film companies, large and small, the most famous of which is Sony Columbia Pictures.

Robert Lee sat in a coffee shop on West Washington Avenue and asked the waiter to refill a cup of coffee for Chris across the way.

As long as the price is right for the copyright of Sony Columbia Pictures' new film, licensing is not a problem. Chris added sugar to his coffee and said, If you want to do Internet licensing, Sony Entertainment is also willing to cooperate with you.

Robert Lee said with a smile: Can we get a deal in writing?

Chris thought for a while and said, No problem. Ronan and I are old friends, so I can introduce you to them.

Compared with the traditional offline disc and video tape market, Sony Columbia's business volume is not large in terms of Internet licensing. The current market size is limited. Chris knows very well that if the price is right, the company will hand over the company to Ronan's Internet licensing company. The company is not the problem.

Robert Lee said: This is a win-win cooperation. Netflix is ​​far ahead in the Internet DVD rental industry, and its sales performance is second only to Amazon.

Being in the same circle of Hollywood, it is very convenient to talk about many things. Chris did not go around in circles, and said directly: Robert, the Netflix website newly acquired by Ronan is leading. The main reason is that the scale of this industry is inherently small.

This is not the first company that Robert Lee talked about licensing. Several companies, including Warner Bros., had similar views. He smiled and said: Netflix is ​​a new company and it will take some time to develop. .”

Representing Netflix and Ronan in licensing negotiations with companies in the industry did not encounter many difficulties. As a company in the Hollywood circle, it is not difficult to obtain relevant authorizations for new films in the industry when the price is right.

The reason why it went so smoothly is that the licensing fees for new Hollywood movies are very high.

Because of Ronan's relationship, Chris and Robert Lee are also very familiar, and said: Well, wait for me to notify you, and then ask your people to discuss specific details with Columbia Pictures' copyright department. I dare not Guaranteed, it will not be a problem for Sony Columbia Pictures to license the new movies released by Sony Columbia Pictures to Netflix in the next five years.

Robert Lee smiled all over his face and asked, Can you get to the bottom of the cost?

If it is a company outside the circle, Chris would not say anything, but this kind of thing is not secret in the circle, the six major companies have tacit standards.

Chris shook his head: It's not that you don't know, why ask again?

Robert Lee said: Netflix is ​​a new company with limited funds. The wholesale price of $10 for a single movie is still a bit high. In addition, there are related licensing fees...

For details, talk to the copyright department of Columbia Pictures. Chris said directly: The $10 is the wholesale price for the Hollywood industry. Robert, if you and Ronan are not part of the Hollywood industry, the wholesale price will not be low at $15.

Robert Lee nodded slightly: Okay, let's discuss the details with the copyright department.

He knew that it was unlikely to lower the price any further. After all, he was talking about new films released by Sony Columbia Pictures in the future, not those outdated old films.

If you want to win the latest movies in the future, you must pay a relatively high price, but new movies also have an advantage. The licensing fee can be shared among the rental fees of each DVD, thereby reducing the company's huge initial investment and effectively relieving financial pressure. .

Chris suddenly said: In the rental business, the film source is very important. You are only interested in new films?

Although I have never been in contact with the Internet rental business, I think it should have something in common with the store rental business. There are only a few movies, even if they are the latest popular movies, they cannot continue to attract customers.

The DVD price of old movies is too high. Robert Lee said: Not only are they the same as new movies, but they can't be selected by people. Good movies and bad movies are packaged...

Chris wasn't embarrassed at all: Isn't that what we all do? He deliberately said: A few years ago, this guy Ronan sold me the overseas distribution rights, and it was also a good movie with a bad movie.

Robert Lee was speechless for a moment, because Relativity Entertainment did a lot of similar things.

Everyone is the same thing, really no need to say who.

If the DVD price of old films can be reduced to less than 5 dollars. Robert said: Sony Columbia Pictures' library will be packaged directly.

Chris shook his head directly: You know it's impossible.

Robert Lee checked the time, decided to end the interview, and said, Chris, thank you very much for your help.

Chris shook his hand and said, You're welcome, this is a win-win for Sony Columbia Pictures and Relativity Entertainment, and Ronan and I have been friends for many years.

He asked with concern: How do you plan to solve the film source? Relying on new films alone cannot support the rental business, and other Hollywood companies will not lower the price than I said.

Robert Lee knew that Chris had good intentions, and said: Ronan has already thought about it.

Chris didn't say any more: Good luck with your business.

Thanks.

There are indeed preparations in this regard. Robert Lee has collected a large amount of relevant information. Some things do not have to be obtained from relevant Hollywood companies. Since the popularity of video tapes, Hollywood film companies will store them in their film libraries. Take out the musty old movies and profit from the home entertainment market through direct distribution or various licensing methods.

Especially when the video tape industry was extremely prosperous in the 1980s and 1990s, there were many companies that obtained a large number of old film rental and sales rights.

Not every one of them has been as successful as Blockbuster and Hollywood Video.

Over the next few days, Robert Lee made tentative wrap-ups with more Hollywood movies on behalf of Netflix and Relativity Entertainment.

Relativity Entertainment reorganized the previous legal department and copyright department, and merged Robert Lee's team into the legal department, and Robert Lee served as the director, specializing in copyright and legal business.

Robbit Lee also took on more work. This time, Ronan gave him overall responsibility for the negotiations with the Hollywood industry.

Its main purpose is to negotiate the purchase of DVDs of new films and related copyright authorization issues of large and medium-sized Hollywood film companies.

Most of the negotiations went smoothly, especially the six major Hollywood companies, as long as the price is right, they will not reject cooperation with companies in the industry.

After Robert Lee reached a few points of agreement, he quickly sent the question to Netflix, after all, it was a question of funds. If Netflix bought DVDs at a price of US$15, these film companies headed by the Big Six in Hollywood would not reject them at all. .

But this price was simply unaffordable for the previous Netflix.

Negotiations were not all smooth sailing. There are also many companies that are not particular about Hollywood. When Robert Lee contacted New Line Films, he wondered if New Line Films proposed because of the great confidence brought about by the success of The Lord of the Rings: The Fellowship of the Ring. unacceptable conditions.

New Line Cinema can reach an agreement with Relativity Entertainment on the Internet licensing of new films in the future, but there is one condition: New Line Film must participate in the investment in the two sequel films of The Bourne 2 and The Purge 3.

Robert Lee directly refused, which is simply grabbing the cake of relativity entertainment.

It's not that Relativity Entertainment and Netflix want something from New Line Cinema!

Such an unreasonable request also made Robert Lee push back: This is a brand-new peripheral sales channel, and the cooperation is a win-win situation, which can increase New Line Cinema's income from peripheral copyrights!

In addition to New Line Pictures, negotiations with Lionsgate and DreamWorks were also not smooth.

Lionsgate made a similar request to New Line, and DreamWorks' Spielberg outright declined to partner with Relativity Entertainment.

While the negotiations were going on, Robert Lee had several contacts with a man named Stuart Coleman.

This was specifically explained to Ronan before he went to San Francisco.

Stewart Coleman's REO Video Services is one of Ronan's options to solve the problem of Netflix's film library.

A large amount of information has already arrived in Ronan's hands, and Ronan also communicated with Mark Randolph specifically. As originally planned, there are generally two ways for Netflix to purchase DVDs of film and television works and obtain relevant authorizations.

The first is to directly negotiate with the film companies headed by the Big Six in Hollywood, who are the copyright owners.

The second way is to talk to Blockbuster. Apart from the new films in recent years, Blockbuster has the authority to re-authorize those old films.

This is also the choice made by major Hollywood companies to distribute goods in North America when they did not have sound video peripheral channels.

To put it bluntly, it means that the manufacturing company sells to large agents, and then relies on the large agents to sell to scattered small agents.

But Ronan's research found that there was a third option—buying a rental company with numerous film licenses.

Looking at the entire United States, Blockbuster is the super giant in this industry, followed by Hollywood Video Company, and then there are countless companies engaged in related businesses, large and small.

Some of these companies developed very well in the 1980s and 1990s, and could directly negotiate peripheral copyrights with Hollywood companies.

But while some companies thrive, others fail over time.

Stewart Coleman's REO Video Service Company, headquartered near the University of Southern California, mainly develops video chain rental business in Southern California, and owns a total of 18,500 film and television works from all over the world.

However, Ruiou company has been going downhill since 1998, and the situation is not good now.

It's interesting why this company went downhill - they were in pretty much the same business as Netflix.

In 1998, Stuart Coleman also discovered business opportunities on the Internet. Using the copyright in his hand, he created the online store of Ruiou to engage in video rental business.

Both parties have invested heavily in this business, but Ruiou and Netflix are completely different in the selection of rental materials. Netflix chooses DVD discs that represent the development trend, while Ruiou uses bulky and gradually outdated DVD discs. videotape.

Perhaps it is the difference between video tapes and DVDs, or it may be that it is more difficult for Hollywood peripheral industry companies to start a business on the Internet. After several years of development, Ruiou has only 20,000 registered users, which is only one-tenth of Netflix.

(Ruiou is a real company that owns 18,500 videotape rental licenses for film and television works, and was later annexed by Hollywood Video for $100 million.)

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