New Video helps indies get access to iTunes

Company delivers films from 85 labels to digital outlets

By Jennifer Netherby -- Video Business, 8/11/2008

AUG. 11 | For independent filmmakers and suppliers, getting access to market-dominating movie download service Apple iTunes can be even more difficult than landing prime shelf space at Wal-Mart.

Because Apple only works with a limited number of companies, more and more independent filmmakers have found the easiest and sometimes only path onto iTunes is through aggregators such as New Video, which is quietly becoming one of the largest digital distributors of independent content thanks to its deal with Apple.

Over the last 18 months, New Video, which distributes DVDs for Docurama Films, A&E, NASCAR and others, has amassed 5,000 hours of TV and movie programming for digital distribution, and it hopes to double that by year-end.

The company has signed short-term deals for digital rights and in some cases video-on-demand rights for films and TV shows from more than 85 partners, including filmmakers such as Ed Burns to suppliers Acorn Media and Stephen J. Cannell Productions.

“We’re working with colleagues and what in the past have been competitors to help them fast track their way into commercial revenue in this world, which I’m going to say is lucrative,” New Video co-principal Steve Savage said.

While the major studios report that digital sales are in the low single digits, digital sales for independent releases from New Video now average between 8% to 12% of DVD sales, Savage said.

That can vary wildly by title. Helvetica, a documentary about the typeset, has been a Top 10 seller on iTunes, yet digital sales are still less than 5% of its DVD sales, said Gary Hustwit, president of Plexifilm.

On the other hand, digital sales for Emmy-nominated Following Sean were a stunning 18.5% of disc sales, while digital was 14% of this year’s disc sales for D.A. Pennebaker documentary Bob Dylan Don’t Look Back.

Most companies choose to work with New Video for easy access to iTunes.

Monterey Media initially held talks with Apple about doing a direct deal but was told that because the movie section is so new, Apple is choosing to work only with aggregators for independent films, president Scott Mansfield said. Monterey chose to go through New Video to get films On Any Sunday, 10 Questions for the Dalai Lama and others on iTunes.

Other independents said they’d heard the same from Apple. Apple didn’t return a call for comment.

New Video isn’t the only aggregator working with iTunes; Mansfield said others trying to aggregate content often approach Monterey but that New Video is the only one that allows it to work directly with Amazon and Netflix.

New Video does offer distribution through Amazon Video On Demand and Unbox, though independent producers say it isn’t as necessary, because Amazon does direct deals with anyone and everyone.

Distribution through New Video also means that small-staffed independents don’t have to handle the technical authoring and formatting to get their product online.

“We could’ve done something with Apple but having New Video as the go-between is great. They take care of the technical formatting,” said Plexifilm’s Hustwit. Instead, Plexifilm’s five-person staff can focus on producing films and theatrical and DVD distribution.

Jim Henson Co. president and chief operating officer Peter Schube said the company is using New Video because it’s a bigger player and able to get more prominent placement for Fraggle Rock, Farscape and other Henson releases than if Henson had gone directly through iTunes.

New Video works with Apple and other digital services like a category manager, helping to find the right title selection, suggesting endcap-type promotions and helping to merchandise titles in other ways. With iTunes, New Video worked on the “Backstage Pass” campaign that promoted a package of top music documentaries such as Bob Dylan Don’t Look Back on the site’s main page.

“We’re using our expertise to bring in a mix of product that’s compelling to consumers when they come into stores,” Savage said. “If we don’t do what we’re doing, then iTunes and Amazon Unbox begin to look like Comcast VOD. With all due respect, that business has never quite taken off. … The selection’s predictable.”

New Video also markets the films to highly targeted audiences through blogs, online newsletters and groups that reach the core audience for a movie or documentary. For online releases, online marketing is a key way to merchandise product as consumers can just click a link to download the movie, Savage said.

Savage said that for independents, having product on iTunes is as much a marketing opportunity as a sales opportunity, because it places independent product before iTunes’ prized young-and-with-it demographic.

“The exposure we’re getting far exceeds direct sales,” he said. “Those people go into Best Buy stores.”

New Video believes DVD will remain its main revenue source for the coming years, but said digital is an important new business to be in.

“Money’s coming in and being distributed to partners today,” Savage said.