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postheadericon Alternative Content: Four Facts and an Advertisement

Earlier this year we agreed with the alternative content consultant  Melissa Keeping to work together on a report, Alternative Content, about the emerging business of showing opera, sport and other non-film material in cinemas. Melissa did numerous interviews, in person and on the telephone, with industry participants, while we trawled through financial reports and a variety of other sources. As everyone who reads the trade press (including the numerous blogs devoted to aspects of digital cinema) knows, there is a lot of activity in this area.

What was surprising is how small this market still is. In 2010 North American revenues were $88 million; in the UK, regarded as the second-largest market, they were $12 million. In both cases these revenues represent between 0.8% and 0.9% of box office. Another sign that this is a budding rather than fully-flowering market is the dominance of two big players. A single content provider, The Metropolitan Opera of New York,  accounted for between 30% and 40% of alternative content box office worldwide between 2008 and 2010, while the biggest distributor, NCM Fathom captured the equivalent of 30% of worldwide box office in 2010 despite its operations being confined to North America.

Something else I wondered about was where the widely quoted view that  alternative content could reach 5% of box office had come from. Then I remembered being on a panel at a Screen International conference (around 2006 I think because Christine Costello was there and she had just started More2Screen), and a questioner asking exactly that question: what share of box office might alternative content reach?

And I think that after a moment’s thought I answered 5% in that rabbit-in-the-headlights moment, but these type of events tend to blur into one another so I may be mistaken. In any case a 5% ceiling still seems to me about right. Think of it like this: to reach 5% of box office, an alternative content event is going to have to make it into the top 20 of the year’s box office, another into the top 40 and so on.

That’s all a long way off. In the immediate future growth will come from the spread of satellite dishes on cinema roofs; after that there are a host of insights generated from experience so far, in this surprisingly complicated market, waiting to be implemented. They will drive further growth. Everything is still to play for in what turned out to be a fascinating area.

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