Market Insight

Tribeca Enterprises and Lionsgate to launch new streaming service, Tribeca Short List

October 22, 2014  | Subscribers Only

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Film festival organizer Tribeca Enterprises is to partner with Lionsgate to launch a subscription video-on-demand (SVoD) service, to be called Tribeca Short List, in the first half of 2015. The service will include movie and TV content from both Lionsgate and Tribeca, will be curated by Tribeca and refreshed on a weekly basis.

At this time, there are no additional details on price or geographic availability.

Our analysis

The subscription market is divided into services which provide content for general audiences - offers from companies like Netflix, Amazon, and Hulu Plus, and services which provide content for niche audiences such as those offered by Crunchyroll, Mubi, and WWE. In 2013, Hulu and Netflix had 5.1 million and 31.7 million subscribers respectively in the US. WWE Network, launched in February 2014, had around 700 thousand subscribers as of June 2014.

While not the first studio to launch a subscription service (Universal launched Picturebox in 2006), Tribeca and Lionsgate will need a solid strategy to sustain interest in the service. Effective policies will include identifying which consumers it serves and whether it will provide enough content to appeal to a general or a niche audience. The size of the content library will also determine a viable price point. With new joiners to Netflix in the US charged just $8.99 per month for a large catalogue of film and TV content, the bar is set very high in terms of consumer expectations for SVoD services. 

Lionsgate already has several content deals with Netflix. EPIX, the joint venture of Lionsgate, Paramount and MGM has a 5-year, $1 billion deal, signed in 2010 with the SVoD provider. Through this deal, Netflix gains access to the three studios’ titles after a 90 day window period for premium pay TV and VoD. Titles included in the deal are The Hunger Games and Twilight franchises and Divergent. Lionsgate entered into two additional deals with Netflix in 2011, including: 1. a 13-episode season of Orange is the New Black, an exclusive Netflix show produced by Lionsgate, and 2. all seven season of the Mad Men series. 

Appealing to a general audience will require a broad content offering. Lionsgate and Tribeca have a strong slate of TV and movie titles, but the amount of content available from the two groups is significantly less than that that which is offered by services such as Netflix, Hulu Plus and Amazon, which source content from multiple partners. General subscription services, which offer a wider range of content, have high costs for content; the expenses for content costs makes general SVoD services challening to run profitably. The companies could roll out the new service internationally, building smaller consumer bases in individual markets, but taking advantage of greater overall scale to offset the fixed costs of launch. But to launch internationally, the companies will need to address two things: 1. managing rights deals with local pay TV operators and channels, and 2. ensuring the service has a variety of content to appeal to a broader audience. To offer a compelling service the companies will have to evaluate the rights deals they currently have with local pay TV operators, and whether ending or altering them in favour of their own service is beneficial. If the companies instead focus on continuing to sell first-window rights to their content to third parties, they risk offering only catalogue content via their own service, diminishing its appeal.


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