Contract players

IFTA revamps agreement model to fit with fast times

If only technology would stand still for a few minutes, perhaps the Independent Film and Television Alliance could stop revising its Model Licensing Agreement.

After 20 years of providing members with a uniform sales contract, one would think the org’s got all the bases covered. But new formats and rights issues are popping up as fast as new films are released, so IFTA’s legal committee must revise the agreement about every five years to reflect technological, political and business changes affecting IFTA’s members around the world.

Just in time for the AFM, the org unveiled the fourth revision of the pact — the first to include a standard Internet rights rider.

“The major change was the advent of DVD and digital formats,” says IFTA veep of research and strategic analysis Bill Anderson. “In the last agreement, we were holding back Internet rights, there was no video-on-demand. Last year we started to get questions regarding Internet distribution. Part of the challenge there is geofiltering — keeping the product in the territory it was licensed to,” he says.

IFTA veep and general counsel Susan Cleary says the association prepared a checklist for selling Internet rights for this year’s Cannes film market. The checklist included questions sellers need to ask buyers, such as how they will handle accounting and what type of antipiracy technology is being used. If buyers can’t answer these questions satisfactorily, they won’t be able to guarantee sellers that territorial rights will be protected.

Adele Yoshioka, VP of international distribution at NuImage, agrees that the focus is on Internet licensing right now. “There’s just so much technology out there,” she says. In addition to untangling the Internet video-on-demand picture, she says her company is dealing with buyers asking for rights to UMD discs for the Sony PlayStation Portable, and any number of new formats could be on the horizon. Technologies like Slingbox, which allows the user to take TV transmissions from one country anywhere in the world, further complicate the picture.

“We try to convince our buyers they should take delivery and release the film as soon as possible. It’s the only way to prevent piracy,” says Yoshioka.

And if piracy, new formats and the Internet aren’t enough issues to grapple with, the territorial rights map continues to evolve. Since the advent of satellite TV, spillover has been a major concern in foreign licensing deals. “What’s changing is language licensing has become incredibly important, because pay channels like MNet and BSkyB are buying larger quantities of territories, which impacts the fact that you have to control the usage of the product by language,” says Cleary.

Recently, Middle Eastern companies have been asking for Palestinian rights to be specified separately from Israeli rights. “Buyers want to carve that out for the first time,” says Cleary.

Israeli buyers sometimes ask for Russian-speaking rights, catering to the country’s large number of Russian immigrants.

And, in another interesting trend, Italian buyers are chasing Italo rights in Ethiopia, Somalia and Libya as well as in Italian-speaking Slovenia.

“We seek to make sure that the license agreements cover many different situations, to be able to cover the breadth of our membership. It’s a smaller and more diverse world now,” says Cleary, although she adds that the way deals are cut has remained remarkably consistent over 20 years.

“To try and make everybody happy is very difficult, and to try to put it on one page is even harder,” says Yoshioka, who helped advise on the one-page IFTA deal memo.

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