Archive for June 2009

A Word About WeEarth.com

June 24, 2009

Note:  WeEarth.com is a sister project to Beneath the Blue — it’s an environmentally themed social network and web portal which is currently undergoing a migration from a proprietary code software to open source code.  Since many of you who follow this blog are partners in a project that includes both Beneath the Blue and WeEarth, I’m posting this update here as well as on other sites. 

WEEARTH EXPLAINED…….

One of the real challenges in doing any kind of an internet project is not only mastering what is possible today, but seeing where things are going and figuring out what the “next big thing” out there is, or might be, and then harnessing those elements that give you the best chance to really be part of the “next big thing”.

When we began our analysis that led us to  “WeEarth”,  the success models that were out there were mega-social network sites like MySpace and Facebook.  These sites were born out of the Internet population’s desire for more overall interconnectivity. For years the standard modes of communication were email, bulletin boards and discussion groups.  These served their purpose, but as technology advanced and younger generations became more computer savvy, the need for something else emerged – and MySpace and Facebook became prime examples of internet answers that served those needs. MySpace was first on the scene to explode into mainstream awareness in 2003.  By combining messaging, blogging, media hosting, forums, friendship capabilities and giving each user their own customizable web profile, comparable to a free turnkey website, MySpace took the internet by storm and became a huge success story.   Soon to follow was Facebook, which slowly but surely climbed to the top.  FaceBook offered (and continues to offer) much of the same functionality as MySpace, but with a very different user interface.  In the end of 2003, Facebook had just been created and existed only for Harvard College students.  In the past 5 years FaceBook has expanded it’s reach, first to other Ivy League Schools, then to all colleges and universities, to highschools and finally to everybody over 13 with an email address in the end of 2006.  In April 2008, FaceBook officially overtook Myspace as the world’s  premiere social networking site and the two sites continue to battle it out by constantly adding new functionality and evolving their user interfaces.

 For years now, social networks have been seen as an area of substantial opportunity,  but the unprecedented and extraordinary success these of these two networks in  cornering the global market has in some ways changed the equation.  In other words, as these two behemoth’s have grown into what they are today, increasingly it has become apparent that the “next big thing” won’t be a rival broad-based social network giant that knocks off one or the other or both of the two existing giants.  Many have tried but all have fallen short.  After all, the main draw of a social network is the user population itself and with nearly everybody already registered to FaceBook, Myspace or both, it’s impossible to compete on a broad scale — and smaller niche group or interest group social networking sites have found they are typically better served by creating groups on FaceBook and MySpace to achieve the desired levels of interconnectedness among their community members, rather than try to “go it alone”.   WeEarth is not a “niche” community but because it is an interest-based community it is not likely to displace the likes of MySpace or FaceBook.  Rather, for WeEarth to blossom it needs to fill needs that are not directly being filled by the likes of MySpace and Facebook – and moreover it needs to be able to harness some of the power that has been created by FaceBook and MySpace (and other social networking tools) in the service of the WeEarth vision.

One of the first issues that loomed large in our planning process was how to get WeEarth.com to do what we wanted it to – and in particular to get it to do things that helped differentiate it from sites like MySpace and Facebook.    To do this even a short  12 months ago, the best approach seemed at the time to be do follow the lead of FaceBook and MySpace by using what’s known as a “proprietary code” — that is an encoding system that is owned by and unique to the developer of the software.  There are many benefits to this type of system.  When you decide to go with a proprietary solution, you’re often deciding to go with a full service organization providing development, design and programming services towards the deployment of your site.  This service continues beyond the launch, playing a large role in the future evolution of your site.  This is especially helpful for businesses, like ours, which are first stepping onto the web scene.  In addition, proprietary solutions typically can be deployed much quicker and with greater initial functionality.  The software provider ensures site security and code quality, fixes bugs and keeps the system’s software and server up to date.  For us, a proprietary solution helped to eliminate some of the guesswork and risk involved in the technological aspects of creating a website while allowing us to focus more of our energy on the business we aimed to do on the web.

 It was in this context that we initially set up WeEarth using a system developed by a company called “Onesite”.  Under this system we could — we thought — get WeEarth to do what we wanted to do, and to do so at the highest level of functionality by harnessing the proprietary code developed by OneSite.

 But as is often the case with the net, things were moving very quickly, and new concepts and opportunities were emerging.  Increasingly there was a perceived need for a kind of convergence in which web users or social network members would not be locked into a proprietary system where they could only easily communicate with others in the system — but rather there was a perceived need among developers and users alike to move away from proprietary code and into what is now referred to as “open source” code — that is code that anyone can use and from which a user can easily navigate in and out of the system.  The problem for WeEarth was that — even six months ago — no open source code existed that could do the things that we want/need WeEarth to do, so this wasn’t an option.  But in recent months there have been exciting developments in Open Source Code, and the advantages of migrating to an open source environment started becoming increasingly apparent.

 In the Open Source world there are 3 main competing codes:  WordPress, Drupal and Joomla.  It is commonly accepted that WordPress is the leader in progress, developer base and overall functionality. We had actually considered WordPress a worthy candidate initially before deciding to go with proprietary software but, while being a premiere content management system, site-building platform and blog tool, it had 3 key deficiencies which kept us from adopting it.  All of these issues have recently been resolved. The deficiencies were:

 1) No abilty for each user to have their own blog –  We could create a compelling and dynamic online publication with multiple users, each blogging and creating articles for our blog, but this only served part of our plan.  We set out to build an online publication powered by a blogging community connected through a social network and at the time there was nothing offered through WordPress.  This all changed when WordPress MU (Multi-User) was launched.  Now it is possible for each person to have their own blog (or blogs) and for our site to have as large a blogger population as we want.

 2) No sophisticated social networking functionality – This was (and is) essential to our project.  Our concept is based on connectedness and we could not consider an option lacking community-building features. Only 2 months ago, on April 30, 2009, the makers of WordPress launched BuddyPress, allowing our users the interconnectivity we desired for WeEarth.

 3) No viable e-commerce solution – A year ago, there were e-commerce solutions available for WordPress, but none of them could be used to develop anything more than a basic online store.  The world of e-commerce, and more recently, social commerce, have set the bar pretty high for online stores and we needed to be closer to the cutting edge.  At the beginning of 2009, the Shopp application was launched for WordPress, opening the doors for a truly dynamic online store for the platform.

 By combining and customizing the new multi-user applications WordPress MU, BuddyPress and Shopp, we are creating a truly innovative and cutting edge website far beyond what is possible in a proprietary code environment.  These tools have hardly begun to be deployed and, for now,  WeEarth is the only project bringing all three together in one site. We’ve hired Lisa Sabin-Wilson to lead our development process.  She is the author of WordPress for Dummies and highly acclaimed in the WordPress community. 

At the end of the day it comes down to this: we invited people to our site to “Use Your Voice… and Be Heard” and the “Be Heard” part of it was lagging in a closed, proprietary code environment where connectivity outside the site itself was not easy to achieve.  A key element to ‘being heard’ on the web these days is an open environment that allows for the highest degree of connectivity around the web. People don’t want to recreate their online presence on yet another site, they want their web presence interconnected with as little repetition as possible – using various tools such as DIGG, Feedburner,  RSS Syndication and others so that what they communicate on WeEarth is easily and seamlessly fed to the widest possible audience including their FaceBook,  Twitter, and other such accounts – as well as social bookmarking and other mechanisms all making it far more possible for the voice that is speaking to be heard widely throughout the internet social network communities.

 Based on all of the foregoing, we made the decision to migrate WeEarth to new open source technology that, in addition to achieving all of our initial goals, will allow users to receive and distribute content via RSS syndication, connect their WeEarth profile with their Facebook and Twitter Accounts, allow users blogging elsewhere on the web to join our blog network without recreating their blog, an iphone application, and much more.

 And that’s where we are today.  In a matter of weeks, the new open source WeEarth will be up and functioning with a degree of interconnectivity and functionality that the old WeEarth could not hope to achieve.  It will also allow us to maximize the benefits of a huge developer base — developers who are familiar with the code we’re using and who can and will be developing widgets, plug-ins and other add-ons all the time.  (Having a huge developer base is one of the top advantages of open source code.)   Each site using the software has different needs, some unique to the site and others overlapping the needs of other sites out there.  The way the open source community works, whenever a piece of code (a widget, plug-in or other feature) is developed, it is released into the community for all to share.  Not only does this mean more features at a lower cost, it encourages a culture of rapid progress and shared development that is continually defining the cutting edge of internet technology.  The release of WordPress MU, BuddyPress and Shopp, all since the start of the WeEarth project, is a testament to the power inherent in this type of system.  By deploying these 3 tools in tandem in support of our WeEarth “Use Your Voice … Be Heard” credo, we believe we are now going to be positioned—and have the tools – to have a bona fide shot at becoming at least one of the “Next Big Things” on the ever-evolving net. 

Cannes Report

June 14, 2009

As promised, following is a guest post from Jamie Thompson, COO of Quantum Releasing.  It is Jamie’s report on the overall market situation as experienced at Cannes — and includes specifics about the market reaction to Beneath the Blue.

NOTES ON CANNES ’09

by Jamie Thompson, COO, Quantum Releasing

It has been two weeks since we have returned from the Marche Du Film in Cannes. Since returning we have obviously been doing a tremendous amount of follow up from the market. Market conditions are tougher than they have ever been and there is a lot of work and communication involved with the buyers, so that is where most of our concentration is directed. First I will give you a quick set of details on Beneath the Blue — then will write more generally about the overall market conditions.

BENEATH THE BLUE

Regarding Beneath the Blue specifically, I have seen more positive, excited responses to this film that I haven’t seen in the marketplace for quite a while. It seems to be defying the odds with regard to the buyers response and the speed that decisions are being made. From the first day of the market, during which we screened a 15 minute promo of Beneath the Blue, we had a rush of buyers. That day we started receiving offers for territories, which is usually unheard of in today’s market (see the more general report below which provides context for this accomplishment by Beneath the Blue.) .   Although we had only intended to “sneak preview” the film and were not actively trying to close deals — at this point we have closed deals with France and Canada — each at an advance Mininum Guarantee that is 3-4 times higher than was the case in the same territories for Eye of the Dolphin (or any of our other films, for that matter.)  We have also taken deals  Czech Republic, Poland, Former Yugoslavia, Romania, Hungary, Bulgaria, and Thailand — all at very good prices in terms of the up-front minimum guarantee as well as the other deal elements.  We are in advanced discussion with buyers for Germany, Austria, Switzerland, Spain, Italy, and Australia with offers coming in. Additionally our buyers for Latin America are very excited and we are confident we are going to close a deal there soon. The excitement level for the movie was actually a great surprise to me, because the market has
been depressed. I had premiered other complete movies that we had anticipated to be our best sellers and we had expected Beneath the Blue to be a preview of what was to come, but with an interest level that high the decision was made to start closing deals at the market.

ASSESSMENT OF THE OVERALL MARKET CONDITIONS
In light of how difficult the market environment and industry in general has been since the financial collapse last year, the Marche Du Film was a very active yet cautious market. Leading up to Cannes this year far we have been dealing with severe problems collecting money on existing deals, having our buyers come to us to renegotiate existing deals, and sales have been down since the economy took a dive last year.

Michael Werner, veteran executive at sales company NonStop Sales was quoted prior to Cannes in the Hollywood Reporter as saying that “Prices have gone way down. You now need 10-15 deals to make the revenue you used to get on
1-2.” 

On Day 6 of the market, page 1 of the Hollywood Reporter had an article that quoted one festival veteran as saying that he had “never seen so much to buy… And no one’s buying anything.”

Variety’s day 6 headline was “In a tough market, it’s survival of the fleetest…

It’s not all bad news though… The market is changing considerably. This Variety piece concludes that “In the old days, a buyer would view a film, make a bid and firm a deal, all within a short timespan. Now it’s more common for companies to lay the groundwork for a deal pre-fest, then announce it at Cannes, or else do the basics here and unveil the deal later.”

I’m still very upbeat on how we are going to do in the current market climate. We came into the market with 218 meetings booked for our two sales people and I was there for support. We were so busy for the first few days of the market that we were often taking three meetings at a time, with me showing trailers from my laptop. Though I was there to primarily assist them in their meetings and be available for negotiation, we were often so busy that the end of the day would come and we would realize that we hadn’t even
had an opportunity to eat lunch.  [[Michael Sellers comment:  I want to try and provide some context for Jamie and his team’s accomplishment in lining up 218 meetings prior the the market.  Most companies like Quantum go to a market with, at best, 50-60 meetings lined up in advance.  A couple of year’s back we first heard about one company, American World Pictures, having more than 100 meetings lined up and that always stood as a high water mark.  Jamie and his team came up with 218 meetings through sheer hard work, including having sales personnel work graveyard hours so they can call Europe on European time, and call Asia on Asian time.  They are truly to be commended for the extraordinary level of effort prior to the market.]]

All of these meetings were fruitful, but we, like everyone else, experienced the reality that many meetings did not result in sales at the market, but rather were a step toward a potential sale that will close in the months after the market.  Many buying companies had cut the number of employees attending the market and were waiting to make offers until after the market, when their DVD sales departments and TV sales departments could also evaluate, crunch numbers, and come up with an informed offer. We are still closing deals from AFM last November and just starting to get offers from meetings in Berlin — there is a time lag and an ongoing process that has to carried out.

The challenges aren’t isolated to just companies like ours. Many of the large companies dealing with major theatrical movies are even having problems. With less overall buying in the marketplace, big movies are going for less money and many are having trouble finding distribution at all. This makes smaller independents with cast that is less internationally recognizable very difficult to sell.

But we did manage to stay busier than most companies, have more meetings, and extend our database of buyers who are actively engaged with us.  As the global economy stabilizes, we believe we are well positioned.

Important Announcement

June 2, 2009

We’ve just put out an important announcement to investors and partners at a separate private blog. To get the password to the private blog, please send an email to sellers.michael@mac.com asking for the password and it will be sent to you. Thanks!