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  Notes:  The Terrible Business Model of Red vs. Blue  
 
 
Posted 2005-03-13 by Tony Walsh
 
 
     
 
The official listing breaks this panel down into a rather wordy summary, but suffice it to say that the boys from Rooster Teeth, responsible for the Bare Naked hit series Red vs. Blue are going to extole the virtues of gonzo entrepreneurialism. My notes to follow...



[Burnie Burns intro]
[Matt Hullum intro]... worked in the movie industry before...

[Burns]
- "we are pretty free-form..." we just embarassed ourselves this week with a downed hard drive...

[Outline]
- Cinematic content focus
- traditional distribution
- how the internet affects distribution
- popular examples from the internet
- specific case study on RvB
- Lessons learned
- "Other Crap"

Brief History of RvB
- little comedic shorts... machinina [Burns defines it]... 5 minutes of film each week... in two years, produced 425 minutes of animation...
- Burnie and Matt went to school in Austin, started a university TV station
- Matt went on to make horrible movies
- Burnie took an IT job in Austin... ended up working with pals Gus and Geoff on side project Drunk Gamers...
- Burnie looking for a way to do cinematic storytelling
- RvB born out of Drunk Gamers

Old School - How content is traditionally-distributed
- theatrical release and home video...
[Matt]: traditional media has the same distribution model several times over, sold first as film, then as video,then as... usually some other kind of marketing engine behind that (merch, etc.)

The Confusion of Free
- radio and television... "free"
- [cites P2P war]
- if it's free in one medium, why isn't it free in another? answer: it's a controlled medium [cites TiVo]... data collected...
- print media multi-revenue stream: paper mag, ad revenue

Theatrical Model
- pay per view ("simple")... whether or not you like it, you pay... no consequence for someone making a bad movie
- games are not making more money than Hollywood
- 2004 was the second highest year in revenue, made $9.23B... ticket sales weren't higher... it's the higher prices... compensating for DVD and other trickle-off sales

DVD
- $5.7B in DVD rentals $15.5B in DVD sales in 2004
- 33% rise in sales
- including VHS, overall home video revenue was $24.5B in 2004

Projections
- 340M DVDs shipped in Q3 2004, a 59% increase over last year... another DVD record
- [cites several quotes about the continuing success of home video]


[Gus walks in]
- 488 terrabytes of data transferred in a month on RvB downloads
- user demand actually superseded the capacity of the hard drive to push data

Along Came Data
- When the net sucked
--- access providers as content providers
--- BBS
--- dial-up ramped up (56k)
--- birth of viral content. i.e. original South Park short
- Rise of Broadband
--- Cable, DSL, Satallite
--- 50MB in 5 minutes
--- faster uploads
--- static IP addresses
--- cheaper broadband
- Broadband Penetration
--- Jan. 2005 broadband in U.S. at 55.47% of internet users [Neilsen stat]
--- still room to grow for any internet business out there
--- over 67% of online transactions are done by broadband users
--- broadband users spent 34% more than narrowband users [last year, presumably]
- Business Access
--- over 80% of workplace access is via broadband
- Universal Broadband Access
--- current broadband condition is like the wild west
--- the telephone company offers universal access
--- all phone users pay for universal access [Burns is against this... seems to be because he sees it as a fund that gets pillaged wrongly]
--- Bush wants universal broadband access mandated by 2007
--- Burns sees this as a tax... "what's next?"
- Problems with Technology
--- challenges that don't exist with other media... network will never be free
--- popularity can kill you [network costs]
--- unique content/access relationship... service providers looking at their audience as a commodity...
--- vicitimized by precision... metrics are "too" accurate... Burns wonders why these metrics aren't applied to traditional media...
--- [Mullun]: people don't see the internet as a legitimate media... but TV is legitimate, despite the inaccuracy in metrics
--- Varying expectations of "free"
--- resistance from old school media companies

[Burns]
- supports content creator's control over distribution and profit
- napster turned piracy into a search engine
- porn is at the forefront of any new technology

My Bookmarks [A look at how some of the following "free" sites *appear* to run their businesses]

- Homestar Runner: really a T-Shirt shop [also sell DVDs]... the project is an ad for the merch...
- Maddox: merch
- Milky Elephant
- Penny Arcade [run ads]
- PVP Online [run ads]
- Happy Tree Friends [run ads]

Elite Status [enhanced subscription content]
- RvB, Fark, iFilm, Atom Films, Something Awful
- RvB DVDs: content all available online

Other Models
- JibJab/Yahoo: Yahoo is becoming like an old school media corporation
- Icebox pay per view: video on demand
- television networks: trying to do different things with the net
- Apple: iTunes... the trailers... giving away free content to attract customers...

Red vs. Blue Case Study
- Watershed moments
--- The Apple switch parody ad: learned about viral distribution accidentally
--- First server meltdown: Fark linked to a DrunkGamers video... hits went through the roof...
--- Computer Gaming World story: re-edited Apple switch ad to point to RvB site
--- Slashdot and Fark: became a regular link on Fark... they got Slashdotted and Farked on the same day... not prepared for the popularity
--- Lincoln Center
--- Wall Street Journal
--- SXSW/Sundance

That Old Double Edge
- the first month: what's next?
- video formats: there's always a cool new way... file size conservation...
- the growing audience
- other days in the week: The Strangerhood... new show in progress... Burns emphasizes the power of regular content
- promotion vs. production
- our P2P experience: tried to distribute via Bitorrent... nobody understood how to use it... caused more headache than it was worth... but Bitorrent was then used to pirate their episodes... notes that pirate sites were happy to take down pirated videos

Putting it all Together
- Regular content
- Be prepared for next level: at least know what things are going to cost you
- SFW or NSFW (not safe for work): safe content opens up your audience
- Know what to measure: identify your metrics, know what needs to be quantified...
- Learn to promote: don't push things... learn how the internet promotes content online...
 
     
 
   
 
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Dinozoiks wrote:
Wow! Thanks for that Tony. Just posted a bunch of other tips here... http://www.dino.co.uk/labs/2008/45-tips-when-designing-online-content-for-kids/ Hope it helps someone... Dino...
in Dino Burbidge's '10 Things To Remember When Designing For Kids Online'


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