David Farnor | On 08, Jan 2015

The Interview has now made more than $31 million from digital downloads and rentals in the US.

Sony’s comedy about two journalists (Seth Rogen and James Franco) hired to kill King Jong-Un prompted a cyber-attack upon the distributor by hackers linked to North Korea. When threats were made against cinemas planning to show the film, Sony cancelled its planned theatrical releasing, ultimately releasing it day-and-date on digital and in a limited number of cinemas on Christmas Day.

Now that the dust has settled – and with a UK cinema release on the February horizon – we look back at five things the industry has learned from Sony’s The Interview VOD release.

1. People are willing to pay for legal streaming

Piracy is a problem. Whether it’s Game of Thrones or a leaked copy of The Expendables 3, people like to watch things without having to pay for them. But Sony’s $31 million haul shows that people out there are willing to pay to stream something legally. Within four days, 2 million people had downloaded or rented The Interview, generating a total revenue of $15 million – a sign that there are still Internet users happy to watch things legally.

Indeed, the electronic sale of films and TV shows in the US jumped 30 per cent last year, according to a new report, thanks to EST spending rising 24 per cent in the final quarter – a boost fuelled by The Interview’s unexpected release. Electronic sales of films and TV topped $1.6 billion for the first time in 2014, with $533 million generated from digital downloads in the last three months of the year alone.

2. Making things accessible (immediately) is important

Sony made the smart decision to release The Interview on a variety of VOD platforms – not just its own services. In fact, it was reluctant to release on their services at all, with Crackle overlooked because of its free-to-view format and Microsoft’s Xbox favoured over the PlayStation. Crucially, when The Interview proved popular, Sony expanded its release platforms to include iTunes, making it more accessible to users.

Last week, that list expanded once again to include cable and satellite companies.

But that accessibility is also important on a global scale. HBO’s Game of Thrones has become heavily pirated by users around the world thanks to the inability to watch it outside of the US very easily – or very affordably. (As of last year, though, that has now changed for UK viewers, with Sky’s cord-cutting VOD service NOW allowing the legal live and on-demand streaming of the fantasy epic within 24 hours of its US broadcast.)

Sony has found a similar thing with The Interview: according to TorrentFreak, The Interview was also popular among pirates online, with 750,000 illegal downloads of the film within 20 hours of its initial release.

Availability was attributed as the biggest driver of piracy, with The Interview only released online in the US – and not worldwide.

“Just signed up to say Thanks, since it was not released outside of US when it should be all at the same time. Will now be finally able to watch this,” one downloader is quoted by TorrentFreak as saying.

The impact of the decision to release The Interview in UK cinemas on Friday 6th February without a simultaneous online release will be interesting to see.

3. VOD makes more money than we thought

Digital distribution is often dismissed by viewers or the industry, with die-hard fans preferring the ownership and collectibility of physical formats, such as Blu-ray, and distributors seeming to only consider the promotion of digital releases as an afterthought to the traditional cinema and DVD dates.

VOD, though, makes more money that people may think. Indeed, The Interview made $31 million from online sales, more than six times the $5 million made in cinemas. That may be difficult to generalise from, because it was only a limited theatrical release, but with almost half of the movie’s $75 million budget recuperated, largely by digital sales, VOD’s potential for income is clear to see.

4. Nothing beats publicity

Publicity is important, whether you’re a small indie going straight to streaming sites or a blockbuster enjoying an early EST release. Sony, thanks to the cyber-attack upon it, bizarrely had a lot of publicity to promote its unprecendented digital release.

The results are Sony’s best ever digital release, but the film’s takings online have decreased over time, as the scandal fades. Indeed, $15 million of its $31 million total were made in its first four days of release, meaning that sales and rentals have slowed down since.

5. Studios can release digital figures without the apocalypse happening

Sony did one more unprecendented thing after opting for a day-and-date digital release: it released its figures, something that Hollywood is traditionally extremely guarded about. Is it because EST and VOD make more money than they care to admit? Or that they do not make very much at all? Whichever theory you prefer, perhaps the most important thing we have learned from The Interview’s VOD release – certainly in terms of the overall industry’s understanding and attitudes towards digital, let alone consumer awareness – is that it is possible to be transparent about digital sales without losing anything.

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