Thinking about the music business

Mark Cuban challenge:

Mark asked the blogging world:

“So if you want a job, and have a great idea on how to market movies in a completely different way. If your idea works for any and all kinds of movies. If it changes the dynamics and the economics of promoting movies, email it or post it. If its new and unique, i want to hear about it. If its a different way of doing the same thing you have seen before, it probably wont get you a job, but feel free to try.”

Mark,
I don’t just want a JOB. If I were to get into this deal, I would want an opportunity; an opportunity to change the way people are entertained. I would want to build a business that created long-term value to the owners, employees and customers.

If you read the comments on this post at Mark’s blog, there are many people with a piece of the solution. However, in order to really solve Mark’s challenge, a team of people have to be willing to change the movie industry yet again.

To solve a problem this complex you have to have perspective. When movies came out in the 20’s the novelty of “moving pictures” were so new people went to see the movie because of the new technology and then they fell in love with medium. As the technology advanced, movies became a primary entertainment vehicle for Americans during the 40’s and 50’s. I think even historians would agree that this time of the industry was the “Golden Years.”

You see, during that time they were the only real game in town. Then came the television. As the television became more economical, the theater business started to change — it had to change. Movies became more “sophisticated.” During the 60’s and 70’s the movie theater business went from being a ma-pa business to a corporate-ran environment. As with most big businesses the theater atmosphere turned into a commodity. Since movie theaters (the vehicle) and movie studios (the fuel) are symbiotic ally connected to each other, the studios changed as well. Instead of making entertaining, quality movies they threw more and more money at “pitches” in hoping of hitting the 1% home runs. Commoditization for many businesses is great for consumers, but not for entertainment. If a company commodifies their entertainment products they eventually marginalizes them. This marginalization is exacerbated if dumb ass people are put in critical decision making positions in these big corporate outfits.

So, with the big screen multiplexes having to draw eighty percent of a movie’s revenue within the first two to four weeks of release, the “entertainment” experience becomes non existent. Forcing thousands of consumers into the big boxes with $10.00 popcorn and Cokes is well, simply put a SHITTY experience. This is why the theater has become a third and fourth entertainment option for most consumers.

Now, there are many, many, many more factors that come to mind in forming my opinions. But I’m not that good of a writer, nor do I have the time to write them all down. Suffice it to say, that the movie business is on the down side of the utilization curve and there is plenty of room in the business for change.

I believe vision at the top drives innovation from the bottom up. If I had a magic wand and someone actually listened to me I’d do the following:

  • Build a top notch studio. A studio that creates compelling, entertaining content. A studio of executives, managers and artisans who are paid well, treated with respect over the long haul and given the resources to do what they do best — entertain people. In a recent article George Lucas is quoted as saying “In the future, almost everything that gets shown in theaters will be indie movies, I predict that by 2025 the average movie will cost only $15 million.” I’d build a studio that understands economics 101, yet consistently delivers outstanding content.
  • Build a network, either owned or franchised, of top notch theaters across the United States and then around the world. Hire people that want to work in these theaters that want to ensure people are entertained comfortably and economically.
  • Start three cable channels — one for movies, one for series based drama and one for sports. Use content from your top notch studio to drive these channels.
  • Build a world class Internet distribution channel. Use the power of of distributive technologies to give people content when and where they want it.
  • Reward consumers for the ongoing patronage. Treat your customers with respect, give them greater value than what they are paying for, ask them what they want, listen to their complaints, solve their problems when they complain. Don’t treat customers like they are cattle. Treat each customer as if they are your only customer.

Wow, this vision is huge. It would take years and years to get all this done. I’m not saying one individual or one company could do all of this. But what I am saying is that by using the best of the old ways along with the best new technologies, a new form of entertainment creation, distribution and management could emerge. Unfortunately, sometimes in life, change has to come from outside the box.

Sometimes it is best to get someone who doesn’t know it can’t be done to get it done.

This is a simple vertical integration model. In my version of this model, you don’t have to own everything, but when you are tasked with changing an old industry ingrained with old ideas, you better have a vision and the audacity to go it alone until it is successful.

Mark, I could be useful somewhere in this jig saw puzzle. You find the spot, give me the resources, give me great leadership and I could do something cool.

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