We spoke with Chill’s Brian Norgard on the company’s stunning new content distribution platform, Chill Direct, the state of the digital media space and how current trends are impact digital distribution.
Brian Norgard is one of the pillars of the Southern California startup community. He has co-founded a number of successful companies, including Newroo (acquired by Fox Interactive Media), Adly, and now Chill, which have received millions in funding. He is an expert in building great internet products, assembling winning teams, and understanding user behavior. Follow him at @BrianNorgard.
Let’s start by outlining what you’re seeing and how it influenced the creation of Chill Direct.
Sure. First, thank you for your time. It’s always humbling when someone takes an interest in your work.
So there are really four factors right now that have influenced our thinking for Chill Direct.
First, we’re seeing social as a real distribution opportunity. We’ve had six+ years of Twitter and almost ten years of Facebook, and we’re finally starting to see how powerful social can be. Not everyone has this power, but people those with organic voices are able to speak to audiences and really drive interaction.
Second, it is really getting cheaper and cheaper to create high quality content. The cost and quality of cameras and editing equipment is falling rapidly. The knowledge of how to create premium content is also improving largely because of the Internet.
It used to cost something like $30,000 a minute to shoot television. With the right crew and attention to detail, people can now shoot for far less than $1000 a minute. And that’s significant because it used to be only the folks who had access to big budgets and studio financing and fancy cameras ould make premium quality content. But that’s quickly changing. I was at Warner Bros. a few weeks ago and was told about a project that was shot on an iPhone by a bunch young filmmakers and one of the studio executives said the quality was as good as some of the stuff they’ve financed not that long ago. So it’s a really really interesting time from a production standpoint. That’s hugely important.
Third, and probably the most dramatic shift in the landscape is the growth of Internet connected devices—tablets, phones, etc. And don’t forget connected televisions which are basically big tablets that will soon have gestural and haptic interfaces that actually work. Soon enough, this will radically change interaction and consumption patterns in the livingroom and beyond.
So if you look at distribution over the last one hundred years, we started with analog theatre and then moved into technologies with images and then moving images hence the motion pictures framing. In the 1950s broadcast exploded which gave way to cable’s zenith of the late 1990s. We’re now entering the digital age. Creators have a whole new set of opportunities thanks to Internet connected devices and distribution. And therein lies a secondary distribution change. We’re moving away from a scarcity model where there are only 150 channels run by a handful of multi-national media companies. Channels? What are channels? Those days are are dying. That’s like counting the number of Web pages. Nonsense. We’re talking about infinite opportunity. The true challenges will arise around the aggregation of attention.
The fourth change that we see is the emergence of communities in the participatory entertainment process. What I mean by that is we’re really starting to see that super fans have leverage in the entertainment process. This is affecting production as you’re starting to see communities emerge around funding, distribution and more. I am a huge believer in the power of communities. One of my angel investments AngelList is changing the venture capital through community. The power is immense.
How does Chill Direct fold into this evolution of entertainment?
Chill Direct is a community that gives filmmakers, comedians, musicians the ability to distribute and monetize premium video content direct to fans. We’re giving them full creative, pricing and rights control while at the same time giving them access to real-time data about everything impacting their project such as who is buying, where are they from, traffic conversion and more.
A real world example of this is how in 2011 the comedian Louis C.K. decided to sell his comedy special directly to his audience. It’s been reported that he made well into seven figures on downloads yet it cost him something like around $250,00 to setup, shoot and distribute the content. After looking at his special and talking to tons and tons of creators, we sort of through happenstance figured out a couple of things. The first thing, the advertising supported model for monetizing entertainment video is not the panacea.
There are certain classes of content it works extremely well for, but long-form content frankly suffers in this environment today. If you’ve just spent two years of your life shooting a film or documentary, where do you go if it didn’t get picked up by a traditional distributor or streaming provider? The answer is no one knows. There are a lot of people that may just put it up on a free streaming site but then realize that it depresses the overall value rather quickly.
So what we wanted to do is create an incredible product for creators that allows them to put their content in our blossoming community, price it, and retain full rights control. They own the content. It is their content. Then we integrate it into social through the Facebook Open Graph and build this beautiful story page for them. It’s a community page where people can interact, comment, share the trailer, purchase bundles of digital or physical experiences tied to the project, and participate in the story.
And I’m assuming you’ve built a powerful analytics tool for the creator?
Yes. The data is probably one of the most exciting parts of this. Studio executives for years have been paying millions of dollars for really rich demographic and cybergraphic information about audiences and how they consume the content and merchandise. We all know how important marketing is so we’re providing really rich analytics for the creators to have an edge.
What’s the business model?
We act as a partner in profit and have a very simple 70/30 split. No hidden fees.
So what content on Chill Direct are you most excited about?
It’s hard to pick a favorite but we recently worked with an incredibly brilliant comedian, Maria Bamford. She’s doing a comedy special but wanted to do it on her terms, not on the terms the networks offered her. So she did a comedy special in her living room for her parents. It’s called “Maria Bamford: Special Special Special”. This gave her complete creative control which is a factor that’s becoming increasingly important amongst creators.
Another is a documentary called “Please Subscribe”, which looks at the story of YouTube yet isn’t available on YouTube. It’s a really interesting story about the career arc of a YouTuber.
Michael Urie from Ugly Betty and Partners is also doing a documentary. Another one that I love is the documentary called “Battlefield of the Mind” about soldiers returning from war with PTSD. It discusses the support, or lack thereof, they receive back home. It’s executive produced by the lead singer of Staind Aaron Lewis.
All these amazing projects are coming to us because the creators want a viable model. The audience is now everywhere – they could be in Sydney or Jakarta, plug in their credit card, and enjoy the content.
So a couple of product questions. Where is the content hosted?
We built all our technology from the ground up, and the creators would be uploading their content onto Chill Direct. The videos are embeddable and each video has a call to action around payment that can be embedded into your site, whether Tumblr, WordPress etc.
Does Chill Direct reserve any approval rights when distributing the content or is it an open marketplace?
It’s an open marketplace, but of course the conditions are that the creators own or have cleared all the rights – like any other user-generated video site.
Tell me about the merchandise sales that you support.
We call those bundles. These are both physical merchandise and digital experiences. Physical merchandise includes t-shirts, posters etc. Creators can pick a price, delivery date and clearly explain what it is that they’re offering. The fulfilment for these orders lie in the creators hands. Digital experiences would be skype chats, phone calls etc. to bring passionate fans closer to the experience. We really wanted to integrate these digital experience because Chill Direct is ultimately a support platform. There’s tremendous power in bringing the superfans involved in the process and bringing them closer.