The North Korean hacker triumph over Sony is proving short-lived. But it also helped accelerate the switch to digital in a field where it has been struggling to take hold. Google is using the opportunity to trumpet its ‘free speech” credentials – and give a kick to its subsidiary Youtube’s ambitions of becoming an outlet for premium content like movies. Sony’s decision to initially pull distribution of “The Interview”, a spoof on the North Korean leader, generated massive publicity. Google’s Youtube was among the first to offer an alternative distribution channel. The marketing value is priceless. Overnight it positions Youtube alongside Apple’s iTunes and Netflix as a destination for those wanting to downloading full-length movies. A long way from its roots as a home for cute cat videos. – AH   (Bloomberg) — Google Inc.’s agreement to show Sony Corp.’s “The Interview” gave its YouTube video-streaming website a chance to show that it’s more than just a destination for amusing cat videos.
The controversial movie, available on Christmas day on Google Play and YouTube Movies for $5.99 to rent and $14.99 to own, topped the charts on YouTube’s movie store.
“The Interview” added to a growing collection of films offered by Google that include “Divergent” and “The Lego Movie,” and is part of its drive to bolster premium content to compete with Apple Inc.’s music and video library. Google, which runs the most popular Internet-search engine, is also seeking to keep users coming to its Web properties as digital rivals such as Netflix Inc. and Hulu LLC draw more Internet traffic. “The Interview” gave Google the chance to prove to a wider audience that it can sell premium content, according to James McQuivey, an analyst at Forrester Research Inc.
“Google has needed a way to show love to studios for a long time and this will do it,” McQuivey said in an interview. “Most people don’t think of” YouTube “as a distribution platform for feature film. It might get a film up there after it’s been out for a year or two, so this is a good move.”
On Demand
The online rollout marked the highest-profile feature film to debut on the Internet and followed Sony’s last-minute efforts to get the movie out. Hackers linked to North Korea launched a cyber-attack on the studio’s computers last month and threatened violence if the film — a satire starring Seth Rogen and James Franco with a plot to kill North Korean leader Kim Jong Un — was shown. In response to the warning, major theater chains canceled the film’s debut on Christmas Day.
The Web debut of “The Interview,” also available Microsoft Corp.’s Xbox video console and a site owned by Sony, may be what’s needed for film-watchers such as Debbie Reed, 62, in Newton, New Jersey, to give YouTube’s pay service a try. The retiree said she’s more accustomed to watching YouTube videos for knitting and other crafts.
“I didn’t know you can do it from YouTube — it’s usually Netflix or Apple,” Reed said. “It’ll be interesting to find out what all of this hype has been about.”
The unconventional rollout of “The Interview” gave the simultaneous theatrical and online release its first big test. Typically, such debuts have been reserved for smaller films, such as independent movies that may not have enough widespread appeal to warrant a big theatrical marketing budget, according to Paul Dergarabedian, a senior media analyst at Rentrak, a market-research firm that tracks the movie business.
More than 300 theaters — many of them independent — rallied around the U.S. to show the film beginning Dec. 25. The film took more than $1 million in ticket sales on the first day.
Free Speech
Previously, low-profile releases such as 2011’s “Margin Call,” which starred Kevin Spacey, and 2012’s “Arbitrage” and “Bachelorette” were released simultaneously via video-on- demand services and in movie theaters.
“We’ve seen some successes for VOD on the same day as the theatrical release, but it’s always been for smaller movies,” Dergarabedian said.
While Google may see increased attention for its video services, it’s also another example of the Mountain View, California-based company taking a stand on political grounds.
“After discussing all the issues, Sony and Google agreed that we could not sit on the sidelines and allow a handful of people to determine the limits of free speech in another country,” David Drummond, Google’s senior vice president of corporate development and chief legal officer, wrote in a blog post.
Taking Risks
More than 6 billion hours of video are watched on the YouTube service each month, reaching more U.S. adults of ages 18-34 each month than any cable network, according to the company’s website. Google bought YouTube in 2006 for $1.3 billion, seeking to add more user-generated video content.
“Knowing Google’s mantra regarding access to information, I would assume the primary motivator is providing the public with an opportunity to see the film,” said Colin Sebastian, an analyst at Robert W Baird & Co. in San Francisco.
The companies that streamed the comedy via the Web took the risk of provoking denial-of-service hacking attacks. Xbox Live and Sony’s PlayStation Network, Internet services that video gamers use to play online, were both hit by connection failures, with the hackers Lizard Squad claiming responsibility. The group had threatened disruptions on Christmas Day.
Killer Funny
Denial-of-service assaults can be difficult to deflect, even if a company has ample warning they are coming, because they are executed by thousands of hacked computers performing normal but database-intensive activities, such as performing searches or downloading videos, all at the same time.
“The Interview” garnered a rating of 54 percent on the Rotten Tomatoes website, and Peter Travers, a reviewer for Rolling Stone, said that while the movie was “stupid” and in “bad taste,” it was also “killer funny.”
“Even when the jokes miss, or grow repetitive, you can’t help rooting for it,” Travers, who gave the movie a rating of three out of four stars, wrote. – BLOOMBERG
The Interview takes in $1m ion Christmas Day
By Eric Kelsey and Mary Milliken
LOS ANGELES, Dec 26 (Reuters) – “The Interview” took in more than $1 million in a limited Christmas Day release, a solid showing that could be quickly eclipsed by the money Sony Pictures makes with its groundbreaking online debut of the raunchy comedy.
That the farcical film – which angered North Korea and triggered a devastating cyberattack on the studio – is now a guinea pig for Hollywood’s digital future constitutes another bizarre twist in the month-long Sony Pictures saga.
After large movie theater chains refused to screen the comedy following threats of violence from hackers who opposed the film, Sony stitched together a limited release in 331 mostly independent theaters and a $5.99 video-on-demand (VOD) rental option on YouTube, Google Play and other sites.
“I’d be surprised if this wasn’t one of the biggest VOD events ever,” said Jeff Bock, a box office analyst at Exhibitor Relations, who thinks Sony could have charged more.
Until Sony discloses the online revenues, it is hard to know if the studio will come anywhere near recouping the $44 million it cost to make the film, plus the $30 million-$40 million that some estimate was spent on marketing the film and its stars, Seth Rogen and James Franco.
The comedy, steeped in gross-out, bathroom humor, depicts the travails of two journalists who get enlisted to assassinate North Korea leader Kim Jong Un. It might not be a typical Christmas Day release, but it filled theaters and got lots of laughs.
Sony “got $1 million in sales, that’s a nice bit of gravy… knowing the main release isn’t happening the way it should be,” said Gitesh Pandya, editor of boxofficeguru.com.
The theatrical release so far amounts to less than 10 percent of the cinemas that had been planned for a wide release in the United States and Canada. The film was expected to gross at least $20 million over the long holiday weekend if in wide release, according to Boxoffice.com.
TIDE TURNING TOWARD ONLINE
The day before Christmas, Sony Pictures released the movie online via Google Inc’s YouTube and Google Play, Microsoft Corp’s Xbox gaming console and a Sony dedicated website. Sony is looking for more partners for digital distribution, though hundreds of thousands of people have reportedly downloaded the film from pirate sites.
The controversy gave the film exposure to audiences that might never have gone to see it otherwise, and many who showed up on Christmas Day said they were there to support free speech.
One of those was David Humdy, 65, an entertainment industry accountant who saw the film in Los Angeles and declared it “silly, entertaining, better than I thought.”
The extensive press coverage could also boost the film in overseas markets, where Rogen and Franco are not yet big stars.
Pandya believes Sony Pictures will be able to absorb losses easily, as it is not unusual for a film of such a budget to fall short.
“It’s hard to find a way that they recoup it all because they did end up spending a lot of money on marketing for a theatrical release that never happened,” he added.
But the fracas forced Sony to explore more fully a territory looming on the Hollywood horizon: “day-and-date” simultaneous VOD and theatrical release. VOD deals tend to give studios a higher slice of revenue than the 50-50 split they share with U.S. and Canadian movie theaters.
“If this does really well, obviously, the tide will keep turning towards online,” said Bock. “It could send ripples down the line in terms of how Hollywood is going to release its products.” – REUTERS
