Special Delivery: Expanding Face of Film Distribution

“As adult movie producers, we are going through an evolution in the way content is first produced and then delivered,” said X-Play co-owner Will Ryder, “and the audience always decides what works best for them. That evolution can be seen most clearly — and often uncomfortably — in the area of content distribution.

There are multiple methods of getting adult content onto the screens of consumers, from DVDs to the Internet. We asked several high-profile studio execs which means they see as the most efficient and commercially viable, currently and in the future.

I am still doing well with DVD sales and I don’t see that changing this year. We are of course selling broadcast and international rights as well as VoD to round out the figures. -Howard Levine, Exile Distribution.

Exile Distribution’s Howard Levine could have been speaking for many distributors when he said, “I am still doing well with DVD sales and I don’t see that changing this year. We are of course selling broadcast and international rights as well as VoD to round out the figures.”

Evil Angel general manager Christian Mann looked at the shape of distribution to come. “The future delivery of adult content, or any content, is actually here: it’s high-def and it’s Internet based; it’s in high definition and is delivered via the web, whether it’s ‘Internet,’ ‘VoD’ or ‘broadcast.’”

“Broadcast I would put as number one,” opined Jim Crawford, the new head of Elegant Angel. “Hotels and then the VoD sites, along with your own membership sites… Everybody has a VoD site, but very few become profitable. There are a few coming out like iPorn, which is completely compatible with iTunes. It’s the first of its kind.

“Things like that: taking the technology that’s available and packing it up in a way that the end viewer finds it easy to access and can be played on tablets, phones, computers, and all the way to the big screen.”

Hustler Video president Michael Klein also looked at the broader picture. “The top methods of delivery of content today are basically through either broadcasting or some form of Internet delivery. Broadcasting consists of linear and broadcast VoD delivery to the consumers, which is still a growing market, especially the VoD portion in territories like Europe, Asia and Latin America.

“On the Internet, pay sites are still a revenue source despite taking a beating from the tube sites over the years. Customers who want quality product still realize that there is some level of payment needed. But the growth is through expanded delivery now through IPTV and OTT with consumers viewing the content on all sorts of products from tablets to mobile phones to Internet-ready TVs.”

X-Play’s Ryder took a somewhat negative view, lamenting, “Broadcast revenues and VoD are no longer exploding and the revenue is in fact shrinking due to competition, conglomeration, the opening of new TV channels dedicated to singular company product lines and free porn.”

But Adam & Eve vice president Bob Christian was more optimistic. “For efficiency, I don’t think anything beats streaming through a solid and fast Internet connection. Broadcast would be right up there, too, of course, except for restrictions and limitations on content (hard or soft or in between) and selection.

“Asking which is the most commercially viable is different. For many, Internet delivery has not made up for the revenue loss of DVD, and DVD still plays a meaningful role in making a project profitable. DVD is still an important part of Adam & Eve’s business and content and delivery mix.”

For Evil Angel’s Mann, DVD distribution has “a limited lifespan,” even though “DVD sales remain an important part of our core business. We are still releasing every production on DVD and we’re currently at about 20 titles per month.” He does believe it will be “completely replaced, by streaming and other means, but the question is when, and I think we’re still talking about years, not months.”

DVD, Exile’s Levine insisted “is still the lifeblood of this business. Particularly when it comes to successful lines such as Forbidden Fruits, AMKingdom and Pornstar Empire… I believe we are a generation or two away from seeing the DVD disappear. People are not very comfortable with massive change. People are tactile buyers. They enjoy opening that package and owning that movie.”

In Hustler’s Klein’s view, “It is still a nice source of revenue for the company and there is still a base of customers who purchase DVDs, but nowhere near the levels of the past, and broadcasting and Internet have clearly surpassed it in rate of return to the company… There are still customers who are loyal to DVD, but that is dwindling.”

As Elegant Angel’s Crawford sees it, “DVD is still a viable market. It’s not what it used to be, but there’s definitely still a profit in it. There’s a reason why there’s so many releases every week from the companies that are still around. Even though it’s a harder push, there’s still money to be made there—especially with your library, comps, and stuff that you can get out at a price point that people still pick up hard goods.”

He does caution, however, that this applies to “established companies. For new companies, I would really think twice, unless you partner up with a well-established company that has a strong [DVD] distribution market already in place. For new companies, it’s next to impossible to make it profitable.”

For 2014, then, what’s the outlook? Says Mann, “The main difference for Evil Angel’s 2014 content distribution is in the broadcast arena, because it’s being handled by our new in-house broadcast division and the focus is on the digital, non-linear TVOD, which means Television VOD.”

Elegant’s Crawford sees his mission, in 2014 and beyond, as “securing relationships with broadcasters around the world. Technology has made the world a small place. It’s my job to build those relationships and get our content on their platforms.”

He concluded: “Everybody has been calling the death of DVD for years, and even though it’s sort of on life support, it’s still here... But, the new technologies in digital distribution will actually take over the entire market in time. We’re a fast-food nation. People want it now. They want to hit a button at a price point that is fair and the content is delivered in a way that they can watch it across the platforms, and have it when they want it.”