The credit crunch is real, some investors are not, and video-on-demand is the hope for the future.
Those were some of the insights imparted by the Tuesday panel hosted by Ernst & Young and Canuck law firm Heenan Blaikie at the Toronto Film Festival.
Moderator Peter Bart, editor-in-chief of Variety, aimed a wide range of questions at the three panelists: producer-distributor Robert Lantos, JPMorgan media banker Clark Halloran and Lionsgate vice chairman Michael Burns.
The credit crunch has undoubtedly altered the “paper-intensive” media and entertainment sector, Burns noted.
Halloran added that the influx of third-party money in the past two to three years will likely stop. “The larger liquidity issues will affect the entertainment industry because there will be fewer parties chasing fewer deals,” he said.
Hedge funders came in for some tweaking. Lantos, whose film career spans at least 30 editions of the Toronto fest, said they are the latest in a long line of investors seduced by the film biz — “The hills of Malibu are littered with their ghosts,” he quipped.
Asked by Bart what he expects to save the business, Burns said video-on-demand, which he estimated returns 60%-70% of revenues to the copyright holder.
“The guy who pushes a button to rent something for $3.99 is not going to buy the DVD or go to the theater,” he said, “so this is incremental revenue for us.”