Freakonomics Flips The Window: Releasing Movie Online Before In Theaters

from the freakout-those-windows dept

We’ve talked numerous times about the movie industry’s love affair with release windows, where they basically try to get people to pay for things multiple times by releasing them in different formats at different times. The first window, normally, is the theatrical release — and the theaters go absolutely livid if anyone suggests shortening the theatrical release window. Heaven forbid anyone go so far as to suggest something as “radical” as a so-called day and date release, where it’s released in all formats at the same time, and watch the theaters go ballistic and boycott the film, as a startling admission that they don’t think they can compete with home theaters.

So, it’s quite interesting to see that the Freakonomics movie that’s coming out in the fall is apparently going to flip the windows over. Sheri Candler points us to the news, as seen at the end of the movie’s trailer, that it’s going to be released via iTunes on September 3rd, and in theaters October 1st:

Yes, it’s being released online before it’s released in the theaters. This isn’t exactly the first time this has been tried. Magnolia Films, who produced the Freakonomics film is trying something similar right now with the film Centurion, which was released via On Demand cable systems a few weeks back, and is about to come to theaters. Still, this is pretty big news. In mentioning this reversed window, Freakonomics author Stephen Dubner mentions that there’s also another “wrinkle to the release schedule,” but he’s not revealing what it is just yet.

I’m curious about this, because what the Freakonomics duo are famous for is exposing how “the common wisdom” is wrong on a variety of things. I don’t always agree with their analysis, but it would be fascinating to see if they’re exposing that the common wisdom on movie release windows is — as we’ve suggested for years — totally screwed up. I am curious, however, to see how the theaters handle this. As mentioned, in the past, they’ve boycotted day-and-date releases, and even boycotted movies that they thought were coming to DVD too soon after the theatrical release (in that case, 12 weeks). So, will theaters be boycotting the Freakonomics film? I really don’t know enough about how the film is being positioned, so if it’s only in indie/art house-type theaters, perhaps it’s not as big an issue. Still, I can’t see any of the big theaters too happy about these “wrinkles,” even if they actually prove that theaters can get more business with simultaneous releases.

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Comments on “Freakonomics Flips The Window: Releasing Movie Online Before In Theaters”

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Simon says:

Release windows are becoming meaningless

When my kids were babies, I went through a time where I rarely had time to watch a movie. Now they are a little older, and even after I’ve had time to catch up on the ‘must watch’ backlog, there are still more titles out there than I have the time to consume. Consequently, the delay before I can rent the Blu-Ray is pretty much meaningless to me – I’m just always a few months behind what’s playing in the theaters.

I don’t feel like I’m missing out on anything, sure there is the occasional pop culture hit like Avatar or Inception where I’m not part of the immediate buzz, but generally people’s leisure time is so fragmented and diverse now that there isn’t a critical mass all consuming the same experience at the same time anyway.

Comboman (profile) says:

Promotional tool?

Given the likely small advertising budget a documentary about economics would have, I suspect flipping the release windows is a way to generate some much needed buzz. Even if it works (iTunes release stirs up interest and lots of people go see it in theaters), the theater chains will just say it’s an exception because it’s a documentary and it wouldn’t work with a big-budget blockbuster.

Michial Thompson (user link) says:

How could you prove anything?

Honestly how could you really do a reasonable comparison of how ANY film would do in one way or the other without people on the opposite side simply saying that it would have done better their way?

Honestly you talk about same day releases to Blu-Ray and Theater and how it would help theaters, yet in my case it would hurt them. I usually go see big named/advertised movies at the theater while waiting for smaller movies to come out on Blu-Ray. Given the choice of one or the other same day I would choose my home theater over the movie theater every time. Much less hassle to plug it into the Blu-Ray and watch in full surround sound and 150″ TV than to go hassle with lines and crowds etc… In the end $30 for a Blu-Ray is still about the same as the theater w/ popcorn/soda/gas etc…

Dark Helmet (profile) says:

Re: How could you prove anything?

“Honestly you talk about same day releases to Blu-Ray and Theater and how it would help theaters, yet in my case it would hurt them….”

Frankly, I’m not sure your conclusion is correct. I think that even taking into account your case, the theatres could still stand to make out in the end. Let’s examine a couple of quick assumptions:

1. Theatres make their money through attendance
2. That attendance is monetized mostly not by ticket prices, but by all the other things they sell at the theatre (concessions, some merchandize, arcades, coffee, etc.)
3. A large majority of people do not choose to see most of the movies they see multiple times IN THE THEATRE

Okay. So, assuming we agree on that (you can tell me how and why if you don’t), your case makes them more money. Here’s why:

1. The movies that are more likely to have a DVD/Blueray audience simply aren’t shown in the theatres, decreasing cost

2. Some that are on the fence are shown for much, MUCH shorter runs, getting what audience they can (and getting concession sales), while not costing as much due to the shorter run

3. The rest of the movies are ALSO shown shorter run due to the lack of windows. This might seem bad at first, but here’s the thing: they now have the theatre space, without huge additions to the facility, to SHOW MORE TOTAL MOVIES! This means more attendance (because of the assumption that people will more often go to see a new movie than see one for a second time). This, of course, means not only more ticket sales (or equal ticket sales in the windowed model), but more importantly MORE CONESSION SALES!

The point is that your, and other’s, refusal to go see good home theatre movies in the theatre is a GOOD thing. It can make the theatres more efficient. What’s wasteful is putting those movies in the theatre for 12 weeks prior to releasing them where they belong: on DVD/Blueray….

Michial Thompson (user link) says:

Re: Re: How could you prove anything?

Your assuming that there would be more movies to show, and honestly that is a huge assumption because as it is if there were more movies to show the run times would already be shortened.

So by running more (quantity) of movies you would need to either count on hollywood to pump out more movies, or you would need to inject more of the lesser quality movies into the theaters. Hollywood cannot come out with an original idea as it is, so the quality of the movies would go down.

As for as what movies would benefit more from same day releases that would be a second issue. How would Hollywood decide which were same day and which were not?

It would seem that the big budget movies would benefit most from same day release by creating a single advertising budget and saving on the multiple advertising cycles, but that benefits Hollywood, and not the theaters.

If you reverse that and say that the same day release is on lower budget releases to reduce the overall cost of release then the theaters are less likely to pick those movies up because they are in many cases the lesser quality movies.

Either case we are right back where we are now where Hollywood takes all the money leaving the theaters to skim by on concessions. And that is another echonomic scale all in it’s self.

I actually understand all three sides of this arguement, and to be honest I could be swayed in either of the directions if I could be shown undisputable proof that doesn’t somehow rely on projections or guesses on one side or the other.

The one thing I don’t see is Hollywood choosing Quantities of movies released to try to maintain their income levels.

Though I do see them doing a same day release with the Blu-Ray price much higher, then a staggered pricing structure to bring the prices down to “normal” levels after a period of time.

For instance Same day release being $60, then 4 weeks dropping to $50, 8 weeks to $40 and then 12 weeks to $30. I could see this staggered approach working in a lot of cases, especially on bigger budget movies. I think this would keep enough of the incentive in still going to the theaters for people like me while still offering the public what they are demanding…

I’d probably still spend $60 on some movies, especially the ones I can’t make time to get to the theater for yet still don’t want to wait on.

nasch (profile) says:

Re: Re: Re: How could you prove anything?

So by running more (quantity) of movies you would need to either count on hollywood to pump out more movies, or you would need to inject more of the lesser quality movies into the theaters.

Why are you assuming that Hollywood movies are higher quality than independents? It seems like the rest of your argument falls apart if this isn’t true, and I think it’s not.

Michial Thompson (user link) says:

Re: Re: Re:2 How could you prove anything?

In a rare case an indi movie may be better, but the masses pretty much vote with their wallets…

Simply put Hollywood has the money, and the money gets the big dollar affects and actors/actresses that ultimately draw the people to the box office.

Not saying indi is worse, just that it’s got the smaller following. And its a numbers game…

nasch (profile) says:

Re: Re: Re:3 How could you prove anything?

Sure, that’s all valid. But the point is that you can have both: 12 weeks (apparently considered a short window??) I would think is way longer than necessary to get most of the value from a release for a theater. Cut it to six, and you can get all the same people you have watching the Hollywood movies now, AND twice as many movies to show too.

Unless they’re currently still filling up the theaters at the end of Hollywood runs (I would need to see credible objective numbers to believe that because it sounds way off), there’s no tradeoff to shorter releases of more movies, it’s just all benefit. Better for the theaters, better for the audiences, and better for independent movie makers. The only ones who might not benefit (and really even they could benefit too if they chose to) are the major studios. They’re the ones with most of the power, so that’s why it hasn’t happened yet.

Mike Masnick (profile) says:

Re: Re:

Wow, I never thought I’d see this site promoting a group of guys who loved Intellectual Ventures so much. Seriously, in their last book IV was going to save the world from hurricanes and global warming with their awesome patent portfolio.

And yet, believe it or not, it is possible to talk about a particular experiment without supporting every statement ever made by the folks who made it.

I said in the post that I don’t always agree with their analysis, but that’s no reason to ignore an interesting experiment, is it?

Dirk Belligerent (profile) says:

The! Horse! Is! Dead!

> “We’ve talked numerous times about the movie industry’s love affair with release windows”

Translation: “I’ve cried endlessly like a little girl with a skinned knee about how my crippling agoraphobia and flatulence keeps me from going to movie theaters and how studios should release DVDs the same day as the theatrical release so I don’t need to wait 4-6 months to see a movie and won’t feel left out of conversations with people who can go to theaters or won’t be spoiled about surprises. When are those stupidheads going to listen to meeeeeeee?!?!?!?”

The movie business isn’t evil because they refuse to cater to your hobby horse. Find something new to whine about.

Mike Masnick (profile) says:

Re: The! Horse! Is! Dead!

Translation: “I’ve cried endlessly like a little girl with a skinned knee about how my crippling agoraphobia and flatulence keeps me from going to movie theaters and how studios should release DVDs the same day as the theatrical release so I don’t need to wait 4-6 months to see a movie and won’t feel left out of conversations with people who can go to theaters or won’t be spoiled about surprises. When are those stupidheads going to listen to meeeeeeee?!?!?!?”

Funny stuff. It ignores, of course, that I actually like going to the movies and have pointed out time and time again that the reason this isn’t such a big threat is because people like going to the movies.

But if you want to insult me, why let little things like facts get in the way?

The movie business isn’t evil because they refuse to cater to your hobby horse. Find something new to whine about.

Um, never said the industry is evil. I don’t think it’s evil at all. I like movies. I want to see the movie business thrive. That’s why I’m suggesting they experimented with smarter business models.

Some of the critics around here are really pretty silly sometimes.

Blatant Coward (profile) says:

Re: The! Horse! Is! Dead!

Why would flatulence stop someone? those nice padded muffled seats, no one hears a thing! Lean a little left and right like reaching for the popcorn, and hey, the agoraphobia gets solved too! I like a nice feta cheese, boiled egg, broccoli, and Horseradish sauce salad the day before. Really clears the tubes.

Heck by the time the ads for TV shows at the movies finish me and the half dozen or so folks with sinus problems can practically lay down in the rows if we wish.

david geertz (profile) says:

the inverse is not the solution either

Releasing the online version of a documentary that has a successful book behind it may really bite them in the rump here. I read this blog regularly now and I am for the most part am at around 50% in agreement with most of the opinions, and theories that Mike posts here.

This one is however, is a very interesting case study that I will be following closely. I actually like Morgan Spurlock and was planning to see this film when it came out in theaters. Now, as it is a documentary and I normally reserve my cinema experience for new releases that i must see and for films that require a big screen, I am more than likely going to watch this film online.

I’ve already got the book, and I won’t watch the film again as there are only about a dozen films in my library that I would watch repeatedly, and I’m wondering if perhaps a true day and date would have been a better move for this one?

If they offered this film up on a site like dynamoplayer of eggup I would certainly pay to watch it, but giving it away for free prior to selling tickets may set the wrong anchor for pricing. I hope for the sake of any backers that may have contributed to this production that they get their money back.

This is truly a risk and an experiment worth watching unfold.

david geertz (profile) says:

Re: the inverse is not the solution either

I made an error. I thought it was coming out on youtube first and now I see its Itunes prior to theatrical. This changes some things but not everything.

What it does change is the fact that now at least half the price tag of the film will go to 2 intermediaries – Magnolia, and Itunes.

Anyone out there who still thinks a movie theater takes 50% of the ticket price needs to go back to distribution school.

Still…I can’t wait to see the results.

Nina Paley (profile) says:

Worked for me

Sita Sings the Blues was online and Free nine months before its theatrical runs in New York and LA (and elsewhere). It was scheduled for a one week run at the IFC Film Center in New York, which got extended to 5 weeks by popular demand. It still screens there from time to time. It continues its art house circulation in smaller cities and towns. All with no advertising, only word-of-mouth.

It works.

david geertz (profile) says:

Re: Worked for me


I have followed the “plight” of your film since day one and am really glad that its working for you now. My only question regarding SITA SINGS THE BLUES, is do you think your marketing strategy using only word of mouth would have been nearly as successful if you were not trying to leverage the lawsuit that was put forward against you?

I don’t agree with the bullying tactics that they tried on you but for someone who does not know you personally, but did end up watching your film, I can say that it happened as a result of watching due process occur and it piqued my interest to see your film. Do you not think that is was primarily the reason for the marketing success of your film? Would you not fall into the “black swan” category?

Thanks and congrats on your film by the way…I enjoyed it.

Nina Paley (profile) says:

Re: Re: Worked for me

There was no lawsuit. Where did you hear there was?

Most people come to the film due to word-of-mouth – someone likes it, they tell their friends to see it. I’m still shocked by how many fans of the film have no idea there was any copyright issue at all. Many don’t even know it’s Free; they see it at a festival or cinema, or on Channel 13 (NY PBS).

david geertz (profile) says:

Re: Re: Re: Worked for me

This is great example how blogs and social media create confusion. About a year ago I remember reading all the flutter and kaffufle about how you could not afford the license fee for your music and that price tag was going to be more than the budget of the film. If you did not comply you would have to ditch the film or find all new music etc etc etc. There were hundreds of posts on this matter that discussed the legal implications around the matter and that you may actually be forced to into paying.

This is what got me interested in the first place as it is an important matter in how film producer’s plan their projects in advance.

I’m glad that the current fans no nothing of the copyright matter, I’m just wondering if that was the reason for the early adopters to begin marketing the project?

The law suit comments were more than likely on linkedin or some other social forum that discusses legal, finance, and film distribution.


Nick Coghlan (profile) says:

Low risk (for them)

Documentaries about people don’t really gain a lot from being on the big screen. Action movies, or things with wide sweeping vistas, the big screen all enhances the impact. Personal documentaries? Not so much.

Still, not a bad way to generate a bit more buzz. I’ve been meaning to add the Freakonomics blog to my feed reader for ages, this will mean I finally get around to it.

Anonymous Coward says:

Itunes? Really? Doesn’t this go against the core theme of the movie? Of trying to do things differently? And this site having no issue with it being released on itunes???? Really?!!
Apple is nothing more than smoke and mirrors and like the right wing rep party feed on PR and propaganda!!! FAIL!

I will never install itunes on any computer!!!!

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