After travelling to London, NAB in Las Vegas, a busy week in Cannes at MIPTV, a 3D conference, a 3D VIP party, around 50 meetings with distributors, clients and producers as well as a number of recent done deals, its time to report on the global 3D licensing market.
This year 3D was one of the main themes at MIPTV in Cannes, Southern France. Tuesday was the dedicated 3D conference with speakers from BSkyB, Sony, Playstation, Sky Italia, Prime Focus, IHS Screen Digest, Can Communicate, HighTV, 3net, the EBU. Most speakers were optimistic about the current state of 3D which was characterized as “further ahead in adoption as HD at comparable timeframe” (IHS). Many speakers were also happy about viewer feedback and viewership numbers. In the U.K., arguably the most advanced market in Europe, live 3D sports coverage of the Premier League (Soccer/Football) as well as Darts continue to get high viewership (Sky 3D) while HighTV claims to have good ratings for their 3D fitness programming.
Additionally, the cost of producing 3D continues to fall. While filmmakers first 3D projects usually are behind schedule and up to double the cost of a comparable HD film, both costs and speed are now almost at par – I know that this is a very controversial topic but, clearly this is where the industry is/must be headed. See an exclusive report here.
On Wednesday, the Fraunhofer Heinrich Hertz Institute’s 3D Innovation Center (based in Berlin) organized a 3D Workshop for producers. A high-level group of German industry experts, all of them official partners of the influential institute, including stereographer, VOD platform, 3D broadcaster, production companies, software and technology providers presented and discussed 3D in more detail than the slightly more mainstream event on Tuesday.
So what about the ‘market place’? Walking throughout the Palais du Festival at MIPTV and at the Las Vegas Convention Center at NAB one gets a clear sense that 3D is (slowly) appearing more and more. There certainly is more 3D content being offered, even by established and relatively large media companies. And the technology is certainly adapting 3D as well. There are more and more suppliers offering 3D cameras, rigs, editing software, and entire 3D (live) production systems – most notably Cameron Pace Group.
Now, this may sound very exciting to us – but the real question is: where is the money? I can’t talk about the technology side of 3D but in terms of selling 3D content, the license revenues fall far behind the expectations of most producers. In my panel discussion at MIPTV (picture above) I have given, what some have called a reality check. While there may be 30 3D channels on air globally, most of them are ’empty’ or just promo/barker channels with very limited content. None of these niche channels acquire third party content. There is a small handful of channels that do acquire – we have business relationships with them. However, their budgets are mostly allocated to sports and movies – a very risky strategy that I have described before here. In terms of broadcasters, there are really only three or four customers that can fund more than 20% of a production. So, filmmakers have to turn to VOD platforms. In the past few months we have negotiated with over a dozen relatively new services, and there are many that do not generate cash (yet). The risk for producers is to tie up too many rights, for revenue share deals that may or may not yield returns.
I have recently launched 3D Content Hub to address two main problems in the 3D ecosystem. First, new 3D offerings (broadcasters or VOD platforms) complain about the lack of 3D content. Second, producers must unite because a larger portfolio of 50 or 100 hours of quality 3D films means a stronger bargaining position when negotiating licensing agreements. By offering a larger pool, a ‘3D Content Hub’, we aim to be the go-to destination for anyone looking to license 3D titles. By doing more deals (40 territories and counting), we hopefully can enable filmmakers to generate significant revenues that they can re-invest into new film projects.
In all the meetings I have had it is encouraging to see that the 3D industry is still at a stage where we all have the same interest – making 3D a success. Therefore as I continue my trip around the world (Tokyo, Seoul, Busan are next) I hope to meet many of you.