Industry Analysis

Greenfield Media is being formed to address a specific set of industry needs that have emerged due to the massive technologically driven transformation the entertainment business has undergone.

Those changes have can be characterized by four major trends that we will capitalize on. Each of these trends have made the landscape more complicated and fluid creating a need for experienced “guides” to bring Independent Content to the marketplace.

The first and most dominant trend is the consumer shift to digital-driven consumption. The Subscription segment of this digital revolution is the largest revenue generator and had been dominated by three early players: Netflix, Amazon Prime, and Hulu. This initial SVOD landscape had been relatively stable for 5 years but that orderly evolution was turned upside down with the arrival of three new studio-backed mega players; Disney, Warner, and Paramount.  All three of these Studios stalwarts are arriving after recent merger activity that will truly supersize and diversify these industry leaders. Disney has combined with Fox Studio giving the combined entity a huge reserve of branded action IP and franchises that will create SVOD competition like we have never seen before. Warner also has a rich catalog to mine, combined with HBO’s expertise in delivering must-watch episodic content and they were recently Acquired by Discovery Network which has great factual content. Based on the need to justify the costs of these massive mergers, Greenfield Media expects to see the emerging Studio SVOD leaders shift away from licensing and Co-Production on TV shows and Independent produced film content toward internally developed TV episodic Originals. While the increased output of TV-based shows has been adequate based on current levels of competition, we believe that as the battle for SVOD market share starts to intensify, the need for more quality content with commercial appeal will create new revenue opportunities for content companies that have the right relationships and understand the important windowing and deal terms needed to be profitable. It is important to also note that there is a second tier of SVOD players with names like CBS Access, Starz, Showtime, A&E, Acorn TV, Crunchy Roll, and 100 others that will also feel the need for increased content flow beyond their internal development capabilities to remain relevant as the big players solidify their market dominance. 

The second trend is transactional digital which is commonly referred to as TVOD. This area covers consumers buying a digital copy to own or renting a digital copy to view one time. While this is a smaller segment of the evolving digital revenue landscape, it continues to grow and provide an important source of feature filmed content that does not get adequate placement on SVOD services that want longer term consumer engagement that episodic programming provides. TVOD is able to satisfy the next generation digital consumer that is seeking movie-based content. It is important to point out that this transactional-based delivery system has demonstrated a strong impact from social media outreach. This allows organizations that have strong sales and marketing capabilities to drive up the revenue in measurable terms.

The third trend in digital consumption is advertising-based and is referred to as AVOD. While it has been around for many years, initially this business model focused on lower-quality content, deep catalog, and the studios only licensed their tired “throw-away” content. In the last 6 months, several new services have started to emerge with familiar names like Roku and YouTube TV and less well-known players like Pluto TV, and Xumo. This segment will service cost conscience consumers and act as a No Cost alternative when your monthly subscription bill reaches its maximum.  As more consumers discover this free digital option it will require higher quality content to satisfy demand, in many ways, AVOD will replace traditional broadcast TV. While this segment is just starting to draw mainstream attention, smart Independent organizations have already established important relationships and will continue to focus on this huge potential segment that mega-media companies have largely ignored due to the mass attention that SVOD has commanded to date. 

The fourth and final trend is a direct outgrowth of all these three digital trends and that is the slow decline of Physical Distribution. While it is natural and expected that we would see a transition from this older technology to the new versatility of digital, it is also worth noting that large segments of Middle America still like the simplicity, the visual high definition quality, and low-cost affordability that DVD and Blu Ray disc still provide. In fact, in 2018 physical sales still represented over 50% of income that Independent Content generates from a typical feature film. Make no mistake, in 5-7 years physical sales will come to end but in the meantime, there is still significant revenue to be made in this format and while Wall Street may seem hostile to this revenue stream, smart private investors see the ability to make short term profits that can be leveraged for future digital-driven content plans.