Had some interesting convo’s and developments (or lack thereof) this week that have brought up a topic I haven’t yet seen discussed much. That is the issue of distributor fraud, and the devaluation of content in a flooded market.

They are two seperate issues, but the first, was actually brought up in a finance discussion with Imperial Capital Bank and their entertainment division for financing of a television series we’re working on.

Evidently, due to high rates of distributors never paying on contracts for content, the discount rate on most distribution contracts against a loan is quite high. Save for a dozen or so major distributors that the bank has relationships and a history with, all these new channels coming out of the woodwork for satellite distribution, and IP distribution, whatever, the contracts are not worth the paper they are printed on. Which of course, makes it a tenuous at best, and straight-up-stupid at worst, idea to finance original content without the upfronts to cover your production costs. (Like THAT ever happens.)

For many years, we’ve heard of theater owners and what not running films extra times and not reporting it, or under-reporting ticket sales so that they can keep more of the cash coming into the theater.

Now, take the 4500 theaters in the US, and multiply that exponentially to get the number of outlets a content creator has to distribute to these days.

Makes a lot of sense to get rid of the middleman/distributor altogether. Like those blokes over at Blowing Smoke. Now, let’s get that on the next iteration of iTunes as a download for $1.99. Whatd’ya say?

Now, on the devaluation of content. In discussions with a number of new media outlets, including the aforementioned satellite network operator, there’s a LOT of the same mantra going around. “Oh, we get a lot of our content from auteurs.”

Which sounds great right? WRONG.

Why? Allow me to present a new definition of “auteur” in the digital age.

Digital Auteur – any person or persons who pick up a moving picture camera, edit something together, and are willing to give it away for free.

“Auteurs,” in my experience, often have a sense of creative superiority that very, very rarely translates into something the audience can connect to, or understand in a way that reaches enough people to be commercially viable. They are typically also those people with utterly no business sense at all, and will happily give away “their” stuff till the end of time (or bankruptcy).

This shit drives me nuts.

Oh, and one last thing. When I say “commercially viable” I’m addressing a story or point of view, communicated and presented in such a way that it holds enough value that it just might not lose money.