Digital Hollywood 2.0: Reimagining Film, Music, Television and Publishing Distribution as a Global Artist Collaborative

The seven largest U.S. motion picture distributors control as much as ninety percent of the U.S. domestic box office and the majority of the global theatrical box office revenues. This economic dominance in gross revenue, however, undervalues the success of financially and artistically * Director, NKU Chase Law + Informatics Institute and Professor of Law, Northern Kentucky University Salmon P. Chase College of Law; J.D. Columbia University School of Law 1988. This paper was initially prepared for presentation at the IP for Creative Upstarts Conference, Michigan State University College of Law, Nov. 9-10, 2012. Michigan State International Law Review successful works budgeted for smaller audiences. Similar economics also drive music and publishing economies. Measured solely from gross revenue, the Hollywood model of distribution dominates most markets around the world. Lower budgeted projects, however, may have much higher returns on capital investment and allow the creative artists to engage more targeted audiences. When more appropriate measures of success are utilized, a different picture emerges. European productions represent a significant amount of content and although Hollywood continues to achieve a disproportionate amount of gross revenue, the European productions continue to achieve profitability and audience acclaim. The same is true elsewhere. India, for example, "has a thriving film industry, both Bollywood films, the Hindi blockbusters coming out of Mumbai film studios, and regional films made in regional languages dominate the Indian box office leaving less room for Hollywood films."' South Korea, Nigeria, Hong Kong and increasingly China all have strong attendance of regionally produced films despite the competition with U.S. products. This article will analyze the legal strategies and business models utilized by the new film distribution companies and will contrast these with the models working for Bollywood, online music distribution at Apple, and e-book strategies at Amazon and Google. These strategies include social networking and community development at the inception, production, and distribution stages of the content. Distribution 2.0 begins with crowdfunding and related strategies to engage the audience before and during production to build interest prior to distribution. The article analyzes current financial structures to assure a healthier economic relationship between participants, producers, and distributors in order to create a sustainable business model. It then looks at the distribution strategies to emphasize the ability to use social networking and communities of interest to build and sustain audiences and rethink pricing strategy. This article will address the financial regulations, intellectual property laws, and contracting strategies that interfere with existing models and articulate the potential best practices for the next generation of narrative and documentary films. The model also creates a platform for shorts, episodic content (e.g., series television), and music. It sounds like bragging, but we didn't borrow from the bank. We kept a certain amount of money aside and financed our own pictures. In a way we gambled a little heavier than some people do at Las Vegas, but we always got away with this. -Harold Lloyd, Filmmaker (1893-1971)2 1. FINoLA KERRIGAN, FILM MARKETING 18-19 (2009). 2. GEORGE STEVENS, JR., CONVERSATIONS WITH THE GREAT MOVIEMAKERS OF HOLLYWOOD'S GOLDEN AGE AT THE AMERICAN FILM INSTITuTE 3 (2006). 564 [Vol. 21:3 Digital Hollywood 2.0 I think the introduction of quick, instant communication is the basis of all our woes. Sometimes it's beneficent, but often it's the other way around. -Gene Kelley, Filmmaker, Choreographer and Dancer (1912-1996)'