Just as movie theaters were trying to recover the effects of pandemic closure, a cost-of-living crisis tipped the scales in favor of in-home entertainment. Studios must once again retool licensing and distribution strategies to reach consumers.

U.S. studios have doubled down on SVOD initiatives since beginning to experiment with new release opportunities during the pandemic. Disney+ did so with PVOD, allowing users to rent select movies day-and-date with their theatrical release, while HBO Max (now known as "Max"), simply made many of its high-profile theatrical releases available to stream day-and-date.

The Status Quo Long Gone
Comparing pre-pandemic and post-pandemic first window buyers reveals a stark departure from the long-established status quo. Between 2019 and 2022, the number of streaming services in the US that premiered major studio movies within one year of theatrical release doubled. The number of premieres jumped from 82 to 91, according to 3Vision.

Warner Bros. Discovery continues to be the first window home for most major studio movies in the US. Titles once limited to HBO now typically appear on its Max streaming service as well. Overall, Warner Bros. Discovery airs far fewer movies from competing studios than it did before the rise of studio SVODs, apart from standing deals such as the Warner/Disney agreement to air 20th Century movies first on HBO alongside Max in the US.

Many of the newer service owners buying major studio movies in the US are supported by their own vertical integration. While Paramount’s Showtime has long been a first window home for many high-profile indie movies, its pre-pandemic acquisition activity from major studios was limited (with Paramount rarely engaging in vertical integration). 

This strategy has changed since the launch of Paramount+, with the SVOD taking most Paramount movies in the first window in 2022. Paramount’s CEO, Bob Bakish, claimed the decision to bring "Top Gun Maverick" to Paramount+ served as a major boost to the service’s subscribers in the US and abroad.

The same is true for NBCUniversal and Peacock. The studio is now more likely to license its movies to HBO or Netflix than before the pandemic, although Universal Pictures’ recent slate has been sizeable enough to split between supporting Peacock and selling to third parties to drive more external licencing agreement revenue.

One of the biggest changes is the output of MGM. The studio that previously focused its sales to Hulu is now going either directly onto MGM+ (FKA EPIX) or Amazon Prime, following Amazon’s acquisition of MGM.

The only studio seemingly uninterested in supporting its own service is Lionsgate, undoubtedly due in no small part to its continued efforts to find a buyer for Starz. This of course will always be a more attractive proposition to prospective acquirers if Starz is not wholly reliant on its relationship with Lionsgate to find content. 

What it has allowed Lionsgate to do is adopt the traditional Sony ‘arms dealer’ approach: licensing movies to several different services, including other first window newcomers like FOX, AMC+ and The Roku Channel.

While studios have pivoted, the U.S. licensing market has yet to land firmly in a new normal. Ongoing market flux will require studios to scrutinize data, as both buyers and suppliers, to a greater extent than ever.

Vertical Integration on a Global Scale
The rollout of studio owned SVOD services has also affected the type of services buying major studio movies in the first window internationally.

In 2019, pay TV services made up 69% of major studio movie buyers. In 2022, it was only 28%.  Global SVODs such as Amazon and Netflix are now a greater share, and studio SVODs are the driving force. 2022 was the first year that they comprised the majority share of first window movie premiere buyers. Most of this was supported by Disney, which essentially went all-in on vertical integration.

Local regulations create unique dynamics in international markets. In France, for instance, any studio looking to engage in vertical integration must contend with existing legislation that prohibits movies from streaming within 36 months of theatrical release. Disney continues to licence its movies in the first window to the French pay TV service Canal+ before they can premiere on Disney+ in a later window.

Even studios without their own service are selling less to pay TV than global SVODs. While the likes of Netflix and Amazon may be acquiring less of the latest TV from third parties, they recognize the importance of big theatrical releases on their platforms. For studios like Sony, the opportunity is huge if SVODs are willing to pay a premium to acquire Sony’s biggest movies for its services across multiple international markets. In the case of MGM, the vast majority of global SVOD sales are to its new parent, Amazon.

Studio movies are more likely than ever to debut on SVOD than their traditional first window home of pay TV. The one exception is NBCUniversal. It has the highest proportion of pay TV buyers, greatly supported by the company’s own Sky group in the UK, Germany and Italy. In the instance of NBCUniversal, vertical integration is helping keep the traditional pay TV window open.

Looking back at market data since 2019, two things are immediately clear: the dramatic scale of change and its resulting complexity. Looking forward, studios will need to analyze their own data with more granularity to understand how variables per market, distribution channel, and even title could impact revenue.  

A Pragmatic Content Approach
Studios are shifting to a vertically integrated SVOD model. Although it’s happening more slowly than it did in the scripted TV genre, movies increasingly serve as banners to attract subscribers and unlock streaming revenue. As streaming profitability displaces growth-at-all-costs as a priority, we may see the current breadth of third-party buyers (both in the US and abroad) remain as it is for now.

The more sudden change that studios face is a need to rapidly, constantly refine distribution strategies. The ability to granularly analyze market, distribution channel, and title-level data is critical to doing so. Expect each studio’s approach to differ more and more from the next in this new era of movie distribution.

LOS ANGELES—MGM’s premium EPIX service has announced that it will be relaunching and rebranding as MGM+ in January 2023. 

EPIX is available as a premium channel via pay TV services as well as an ad-free streaming service. 

“MGM is one of the most iconic and beloved brands from the golden age of entertainment,” said Michael Wright, head of MGM+. “This rebrand is a promise to existing and new viewers that MGM+ is the place to find television that reflects and celebrates the legacy of the iconic MGM brand – cinematic programming with sophisticated storytelling that entertains, delights, surprises, and transports. MGM is television for movie lovers.” 

The new brand will debut on January 15, 2023, in conjunction with the Season Three premiere of the series “Godfather of Harlem”. The show’s second season was EPIX’s best performing season of all time, breaking records for single-title streams in a single day across EPIX’s digital channels, the company reported. The Season Two finale was EPIX’s best performing finale episode to date. 

In conjunction with the rebrand, the service also announced that it had greenlit a number of new series, including crime thriller “Hotel Cocaine”, “Belgravia: The Next Chapter”, and “Untitled Amityville Murders Docuseries”.

The new brand logo will embody the rich legacy of MGM, while at the same time orienting the brand toward the future, the Amazon-owned studio said. 

The design studio Imaginary Forces has been hired for the rebranding. 

SEATTLE—Amazon has announced that it has completed its $8.5 billion acquisition of MGM studios, giving the tech giant access to MGM’s library of 4,000+ film titles and 17,000+ TV episodes as well as the James Bond properties and other storied franchises. 

The deal was approved earlier this week by European regulators but has not yet received formal approval from U.S. regulators. 

The Wall Street Journal has reported that the regulatory clock for challenging the deal with the agency expired, leaving Amazon free to move forward.

However, the commission would still have the ability to challenge the acquisition later, if a majority of the FTC votes to do so, the WSJ noted. 

The deal, which was first announced last May, is part of a massive effort by Amazon Studios and Amazon Prime Video to ramp up original production and content spending, which hit $13 billion in 2021. 

Broadcast Management Group (BMG) and MGM Studios deployed two LiveU LU800 multi-camera production units to support REMI production from BMG’s Las Vegas production hub to commemorate the 40th anniversary of “Rocky IV” and the release of the new Ultimate Director’s Cut.

The LiveU LU800 field units were used to produce an eight-camera live program from several locations in the Philadelphia Film Center.

“We are thrilled to provide live transmissions of the special event commemorating the anniversary of `Rocky IV' and the franchise’s message of unwavering determination to fulfill one’s dreams,” said Mike Savello, LiveU vice president of sales, Americas.

“The LU800’s ability to transmit four fully frame-synced full-HD feeds from a single portable unit changes the economics of remote production and gives companies like BMG the ability to deliver high-quality live content to movie screens, televisions and mobile devices," he added. 

The production included a 20-minute live pre-show and a 25-minute question-and-answer session with “Rocky IV” star, writer and director Sylvester Stallone, followed by the premiere of the film to audiences at more than 700 Fathom Event Theaters around the country.

The production was shot with eight Grass Valley broadcast cameras, including a jib in the theater. Two additional cameras were used on the red carpet. BMG CEO Todd Mason directed the live broadcast on site from BMG’s REMI Mobile Unit One. Signals were sent from the LU800 field units back to the BMG REMI broadcast hub in Las Vegas and then uplinked to Fathom Theaters.

More information is available on the LiveU website.

SEATTLE—Amazon Web Services has reached a multi-year deal with Metro Goldwyn Mayer (MGM) that will power MGM’s media supply chain with AWS cloud technology to help distribute its TV and film content across multiple platforms.

The new MGM media supply chain will use AWS compute, serverless, storage, machine learning and media services. MGM will build a data lake on AWS using Amazon Simple Storage Service (Amazon S3) to provide up-to-date content rights and ownership information and connect to a microservices architecture that will simplify and automate workflows and processes throughout the media supply chain.

AWS Elemental MediaConvert will be used by MGM to automate the processes for preparing and delivering MGM content, optimizing video for viewing on any screen, per AWS. The AWS Lambda serverless compute and AWS container services, meanwhile, will assist with the transfer, process and packaging of video for all media channels on demand. Amazon S3, Amazon S3 Glacier and Amazon S3 Glacier Deep Archive are set to provide MGM with secure content and data storage and archiving. 

There will also be the addition of Amazon Rekognition, a machine learning technology that can analyze content, as well as create and tag specific video frames with metadata.

MGM is also slated to use AWS analytics services like Amazon EMR and machine learning service Amazon SageMaker to predict content viewing and sales trends.

“Our new cloud-based media supply chain will give us increased visibility into owned content, the ability to better inform our sales teams and faster processing of licensing deal that will help us deliver more content experiences to viewers and grow new revenue opportunities,” said Doug Rousso, executive vice president and chief technology officer, MGM.

For more information, visit aws.amazon.com.  

BALTIMORE & LOS ANGELES – Sinclair Television Group and Metro-Goldwyn-Mayer are boldly going where no one has gone before. The two companies announced a new partnership to jointly create, develop and distribute a 24-hour/7 days a week science fiction multi-channel network. The channel will feature more than 1,500 hours of MGM content. Sinclair Television Group owns the channel, with MGM handling network operations, including programming. Steve Pruett, Sinclair Television Group co-chief operating officer, will oversee the venture.

The science fiction channel will launch in the fourth quarter 0f 2015 to 30 percent of the country. Sinclair and MGM are pursuing additional distribution deals with other broadcasters prior to the debut. The network will feature MGM TV series such as “Stargate,” “Poltergeist” and “Dead Like Me,” as well as other science fiction, fantasy and adventure titles.

Sinclair Television Group is a subsidiary of Sinclair Broadcast Group located in Baltimore. MGM is a film and television production and distribution company in Los Angeles.