Source: Raugust Communications
The year 2014 was a landmark one in the rise of digital distribution as a viable means of supporting a licensed entertainment property.
First, studios and property owners began forging deals to distribute archival content online. Scholastic signed with Netflix, the Jim Henson Company with Hulu Kids, Disney with Tencent in China, and Saban with LOVEFiLM in Europe, while IMPS launched a dedicated Smurfs YouTube channel, to name a few. These platforms offer another venue for consumers to discover and enjoy the properties and keep them alive beyond the original broadcast.
Content providers then began to produce original series based on existing franchises. Netflix, for example, is launching series inspired by Ever After High from Mattel, Dinotrux from DreamWorks, Popples from Saban, King Kong from 41 Entertainment, JustinTimefrom Guru Studios, and Winx Club from Rainbow. While the new properties are digital-only, their roots in traditional media or products help draw viewers.
Content producers also are using online channels to expand into new territories where their properties are unknown or unfamiliar. In the U.S., HIT Entertainment is launching Fireman Sam on Amazon Prime, Spanish company Imira is utilizing Hulu for Lola & Virginia, French studio Ankama Animation is launching Wakfuthrough Netflix, and Fuji Television is introducingPonkickies via Oznoz.
The initial wave of true digital-first properties, not based on any franchise, consisted of content that was meant to help seed the market for traditional TV. Disney Jr.’sSheriff Callie’s Wild West debuted on the WATCH Disney Junior app shortly before its TV debut, while Nickelodeon introduced Welcome to the Wayne on its digital platforms while developing a traditional TV series.
Most recently, IP owners have begun creating all-original properties, intended to live primarily online. Amazon has commissioned shows including Tumble Leaf and Creative Galaxy, Rovio and its ToonsTV online channel have introduced Angry Birds content and a new series from Stan Lee, and PBS Kids launched Fizzy’s Lunch Lab and Plum Landing on its own digital platforms. Such productions increased exponentially in the latter half of 2014.
While the proliferation of digital distribution deals has occurred at a brisk pace, the launch of licensing programs based on digital originals is taking hold more slowly. That said, an increasing number of digital-only properties are starting to become available for merchandise licensing. Initial efforts typically start small, with categories that will help generate more awareness as well as bring in revenues.
Jim Henson’s Doozers. Frederator Studios’ Bravest Warrior, and Fizzy’s Lunch Lab all had early book publishing licensees (Simon & Schuster, Perfect Square, and Candlewick, respectively), while Stan Lee’s World of Heroes YouTube channel and one of its flagship shows, Bad Days, signed Choice Collectibles and Shark Robot for autographed collectible items.
The progression through the various stages of digital distribution has happened so rapidly that the introduction of each stage overlapped, almost to the point of being simultaneous. As of 2015, all of these distribution strategies co-exist and all serve as viable means for licensors to feed their fans more content. How long it will take for an online-only property to break through and sustain more than a niche licensing effort remains to be seen.