From “Arbitrage’s” Facebook page

Richard Gere’s new movie “Arbitrage” was released this week to positive reviews and healthy box office returns.  According to Variety, “Arbitrage …is banking on $750,000 Friday and roughly $2.3 million for the weekend at just 197 locations.”  It’s not the robust opening weekend box office returns that makes this worth nothing.  What’s significant is that the film’s theatrical release was only one part of a “day-and-date” release business model utilized by Lionsgate/Roadside. “Arbitrage” was released in theaters and VOD (video-on-demand) the same day.

Roadside Attractions used the same release model with their 2011 indie hit “Margin Call” , a film that grossed 5 million dollars in domestic box office. While some argued that the simultaneous VOD would undermine box office revenues, (VOD numbers aren’t made public), given the fact that Roadside is using the same approach with Arbitrage, one can only assume they liked what they saw.

Aside from bottom line figures, this release model is significant because it should dampen demand for illegal, pirated downloads.  With “Arbitrage” immediately available via VOD, those who want to watch the movie right away,  and avoid the theater, can do so via  iTunesAmazon Instant and similar on-demand sites.

But thwarting piracy isn’t the only benefit.  For distributors,  the option of using  day-and-date release or the “ultra” release (releasing on VOD before a theatrical release) give studios a cost-efficient way to market a film.

Tom Quinn, President of the new Weinstein distribution company Radius was interviewed in a recent Entertainment Weekly article.  Radius is distributing the Sundance hit “The Bachelorette” via the “ultra-release” model.  Releasing the film on VOD a full-month before it’s September 7th theatrical release helped generate buzz and made it a #1 download on iTunes:

Once the movie hits VOD, the hope is that audiences will click to it, so to speak, and help spark the word-of-mouth campaign for the impending theatrical release — without the massive expense of marketing a major film. ”Not only is [VOD] a marketing tool,” says Quinn, “but more importantly, it’s a revenue generating marketing tool…

While it may seem somewhat counterintuitive — wouldn’t VOD ultimately take away some of the money the movie would otherwise be making at the box office? — when it’s working right, this “multi-platform” release pattern forms a mutually beneficial feedback loop, with the VOD release fueling the theatrical box office, and the theatrical release raising awareness for VOD. “You’re only creating more audience by showing your movie,” says Quinn. “If it has good word-of-mouth, then you should show it to as many people as you possibly can.” –Entertainment Weekly

Piracy apologists have long argued that online piracy was good for business.  Problem is, the piracy “business” is predicated on theft, benefiting criminals like Kim Dotcom, not creators.  Despite  endless spin to the contrary, illegal downloads do not generally translate into profit for creators.

The key to these new models is the fact that  distribution choices are controlled by rights holders, not pirates. Profits go to creators and not to thieves.  A film’s distribution can be tailored  to match audience demands and generate revenue–two goals that need not be incompatible.

Fact is–movies and music don’t have to be free for the internet to be free.


For more on Radius and their use of this new distribution model, Toronto Q&A: Radius-TWC Presidents Tom Quinn And Jason Janego On How Multi-Platform Is Changing The Indie World