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CReATeS Research Report Glasgow Film Theatre

CReATeS Research Report Glasgow Film Theatre

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Published by Nesta
This project was a partnership between Glasgow Film Theatre and Edinburgh Filmhouse to develop an online digital media player.
This project was a partnership between Glasgow Film Theatre and Edinburgh Filmhouse to develop an online digital media player.

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Published by: Nesta on May 01, 2014
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GFT & Filmhouse Player – Research report
Exploring audience reach and engagement for cinemas through the use of Video-on-Demand
Dr Niall G MacKenzie, Hunter Centre for Entrepreneurship, University of Strathclyde
Executive Summary
This project was a partnership between Glasgow Film Theatre (GFT) and Edinburgh Filmhouse with their technology partner, Distrify to develop an online digital media player. The player allows users to download or stream films offered by both cinemas from wherever they are, without the need to physically attend the cinema. The player therefore offers the potential for new income streams to the cinemas, in the context of the growing uptake of Video On Demand (VOD) services among viewers. In addition to the new income streams, the player allows users to share their purchase via social media and other platforms, which they can then earn personal revenue from, by sharing the rental and encouraging others to rent the film through
the player’s
 built-in affiliate marketing capability. The project received £90,000 from the Digital R&D Fund for the Arts in Scotland.
The Project
The aims of the project were to:
 Explore new business models through the use of digital technology to expand audience reach and engagement through a cinema-curated VOD digital online service.
Explore the viability of the ‘day
date’ business model by simultaneously releasing six different films on VOD on the cinemas’ respective web
sites and theatrically, in the GFT and Filmhouse cinemas.
Trial the ‘affiliate revenue’ business model, whereby a proportion of the VOD income is
returned to the programming cinemas after being shared by customers who also receive affiliate payments.
 Enable the GFT and Filmhouse to research best practice in broadening their audience figures
and assess the impact of ‘windowing’ strategies on box office takings by trialling a selection of
films with non-traditional theatrical and VOD release patterns.
the tools of Distrify’s VOD service to gather previously unknow
n user data sets, specifically focusing on identifying the geographic location of audiences, the routes to purchase through various marketing channels and examining the relationship between theatrical and Home Entertainment windows.
The project was developed by Jaki McDougall, the CEO of the GFT and Ken Hay, the CEO of the Filmhouse. Marjolein den Bakker was hired as the Video on Demand Project Co-ordinator liaising
 2 between the two cinemas and
the tech company for the duration of the project. Distrify’s
developments were led by Stephen Green, Andy Green, and Peter Gerard.
In summary, the results of the project were:
 The commercial development, launch and retention of the players by GFT and Filmhouse;
 By February 2014, a total of 38 films were available on the player, of which 17 were shared between the cinemas;
 Evidence that the
cinemas’ physical attendance has
not been adversely affected
(‘cannibalised’) by the players
Insights derived from the development of the players relate in particular to Award & Development, Challenges & External Stakeholders. The key lessons learned from the project were:
 It is important to carefully consider the time and resources required during the lifetime of the project (e.g. marketing and testing), particularly when one partner is a small organisation with less capacity for changes in scheduling/responsibilities.
 It is useful to know your partner before embarking on an R&D project that is so close to commercial exploitation. Having an established relationship makes it easier to discuss and implement changes as required.
 Communication between partners is important, particularly for those partners less familiar with the technology being developed and exploited.
 External stakeholders (in this case distributors/customers) may not necessarily see the immediate value in the technology that is being introduced, nor will they necessarily want to be involved with it. Careful managing of external relationships can thus often be required to ensure appropriate attention is provided to all stakeholders.
Key areas for the future include decisions on how to resource the player within each arts partner’s
budget and future plans in order to continue to grow audiences. This growth might potentially come from expansion of
the player’s
use elsewhere, in particular for curation of films in other than the current geographical areas covered by the GFT and Filmhouse (i.e. outside of Glasgow and Edinburgh). Distrify succeeded in winning grant funding from the second round of the Digital R&D Fund for the  Arts in Scotland with the Scottish Documentary Institute, to test and develop new features for the player. This award indicates that the player has potential for further development.
1. Background
The project is a collaboration between the Glasgow Film Theatre (GFT), Edinburgh Filmhouse and the technology partner Distrify to develop an online digital media player that allows for the purchase and viewing of films curated by the GFT and Filmhouse through their websites. With the rapid growth of video on demand (VOD) services in the UK (Netflix, TiVo, Lovefilm, Blinkbox, etc) amongst the film-watching population, cinemas are facing increased competition for their services. Industry statistics below show that the growth of VOD services is continuing and projected to increase:
 Online Video On Demand (VOD) in the UK has grown from £0 pa in 2002 to an estimated £243m in 2012, up 50% from 2011.
 The British Film Institute anticipates continued growth in this area due to improvements in broadband speeds and mobile technology but cautions that robust data is needed to understand the growth potential, particularly for independent and specialised film.
  As a result of this increasing competition, both the GFT and Filmhouse were interested in exploring alternative ways of broadening audience reach and increasing revenues, without compromising their physical footfall. To this end discussion between Distrify and the GFT took place to explore the possibility of using
 digital media player technology for offering the
 customers an alternative viewing screen from the comfort of their home or on the move. GFT
was established in 1974 and is one of Scotland’s leading independent cinemas.
 A non-profit organisation, GFT is part of the Glasgow Film umbrella comprising the GFT, Glasgow Film Festival, Glasgow Youth Film Festival, Glasgow Short Film Festival and Cinema City. Its Edinburgh counterpart, Edinburgh Filmhouse
, was established in 1979 and is the trading name for the Centre for the Moving Image which, similarly to Glasgow Film, is an umbrella organisation that also comprises the Edinburgh International Film Festival and Edinburgh Film Guild. Both organisations are dedicated to the promotion of independent film and cinema within Scotland but retain a strong international focus in their activities. The Project team consisted of Jaki McDougall (CEO of the GFT), Ken Hay (CEO of the Filmhouse) and Marjolein den Bakker, who was hired as the Video on Demand Project Co-ordinator liaising between the two cinemas, and the technology partner Distrify. Distrify (http://www.distrify.com/) is a small film/technology company started in 2011 and comprised of twin brothers Andy and Stephen Green, and Peter Gerard, with a number of sub-contracted developers coming on board as the company grows. They provide video streaming, via pay-per-view, as a service to different types of film rights-holders or video-creators ranging from large distributors to
cinemas to first time filmmakers. Distrify’s technology
 is intended to make it easy for their clients to sell online video streaming as a rental from its website. Their player also offers other products such as physical copies of films on DVD or Blu-ray. Their client group comprises a range of different sizes of distributors, cinemas, filmmakers and educational groups including the filmmaker Terry Gilliam (of Monty Python), the rock band Led Zeppelin, and Edindocs (the Edinburgh documentary festival).
 The relationship between Distrify and GFT came about through the shared interests and co-location of both parties in the
 building in Glasgow.
Distrify’s founders are filmmakers who are also
programmers and coders. After having difficulties getting their films out to the public, they developed their own proprietary digital media player in early 2011, which remained in beta testing until summer
 For more details see https://distrify.com/examples.

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