Video On Demand Licensing Structuring
Several Video on Demand Service Providers (VoD-SPs) were facing serious challenges in structuring flexible licensing deals with major Hollywood Studios in terms of costs, risk mitigation, and distribution model. We were asked to engage on behalf of those VoD-SPs and structure appropriate terms while advising on general engagement procedures to create an attractive distribution eco system.
Problem & Approach
The key goal was to have a VoD-SPs to examine thedesired short to midterm content requirements as well as current sales & marketing strategies under consideration of rights management and distribution requirements to maximize ROI for both license holder and licensees.
We converted the findings from our analysis into an appropriate business plan including revenue projections suitable to engage with Hollywood licensing departments. The key objective was to demonstrate that the VoD-SPs have strong, creative and executable strategies to maximize ROI in line with a reliable sales forecast. We also helped prepare documentation for security and rights management processes which were then implemented at VoD-SPs, to support distribution and licensing models.
We negotiated the terms and conditions with Hollywood studios so as to minimize or avoid Minimum Guarantee payments, to minimize release windows between theatrical and VoDrelease, as well as finalized the revenue split between with VoD-SPs.
The design put in place led to the minimum guarantee to go down by 70%, shorter release window by 30% as well as a Revenue split gain of 20%.