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Content Licensing Gets Complicated: Who’s Minding the Store?

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“I think what’s happening is that the distribution channels are evolving faster than anything can keep up with it,” he says. More platforms, more locations, and more end users wanting to download content for offline viewing is making content delivery more complicated.

“The concept of people wanting to take their content with them on their phones for offline viewing has been around for a while. However recently it’s [become] almost a common factor in every distribution method,” he says. There are also requirements like the new EU digital single market rules which came into place in April that require European customers have access when traveling to the same content they are licensed to consume within their home territory.

There is usually a time, for both retailer and distributor, where the math becomes too complicated to handle manually. “If you’ve been doing video on demand rentals only and now all of a sudden you want to do digital HD downloads,” says Sid, “that’s often a trigger point because the amount of information that you’re going to track now has probably quadrupled or quintupled. So there’s just so much more stuff to type in.” While viewing downloadable content may have gotten its second wind, another familiar business has become popular again too.

The Retailer: Blockbuster

Casper Hald heads up Blockbuster in the Nordics. The once-ubiquitous video rental store name was licensed to the Danish telecommunications and media company TDC Group in 2013. Blockbuster has more than 10,000 movies and 500 seasons of TV content that it makes available for 2-day online rental or purchase. These 16,000–17,000 assets are licensed from approximately 60 content providers.

“The trick here is that there’s a high degree of complexity behind all of this, because the agreements with the content providers have terms in their agreements that change over time,” says Hald. A new release often has one set of revenue-share terms, and they change as the release ages.

“We have 500,000 transactions and we have to [process] those transactions to approximately 60 agreements which all contain numerous categories and where every category includes various commercial schemes,” says Hald.

So the math looks something like this: “One title in four territories, that’s four licenses. But it’s offered both for rental and sell-through. So then four becomes eight licenses. Then if you have SD & HD then you can double this to 16 licenses. If you do campaigns or if you do several cycles you have first, second, third, fourth, and fifth cycle—then you can multiply [by] five again.”

Follow the Money

The real benefit of automation is the efficiencies it creates. Modern rights management systems automate and operationalize the process of rights. Content can be output with the proper variations of elements, such as subtitling or dubbing. For a studio, rights management can help more efficiently prepare content for distribution.

“When you have 900+ distributors that we deliver to on a regular basis, being able to efficiently order stuff is really important,” says Pethani. “Even placing an order to figure out what state your asset is in and what underlying workflows need to happen to get it to the distributor, the investigation is really expensive.

“We know what can or is not being monetized the way it should,” he adds. Content promotions and analytics can be used to optimize ROI for both content owners and distributors. An automated system easily manages updates and promotions for individual or bulk changes to content licensing and pricing, flowing out to all distributors.

For a retailer like Blockbuster, automation helps the company see exactly where it makes the most money, then slice-and-dice this to understand whether profit comes from a promotion, type of content, format, or whatever else he’s tracking. “Transactions from many different platforms may come with various data set and having that data well-structured is a prerequisite,” says Hald. Mediamorph does the financial settlement for Blockbuster customers. “We’ll take in the billing system data and generate out how much should be paid,” says Sid.

“An important KPI for us in using the system was simply that without adding more resource that we could actually oversee a more complex and diverse distribution and handle many more revenue streams with a system where only very few people are necessary,” says Casper. “It doesn’t matter if you handle one or five territories, or if you handle SD, HD, 4K, 3D, whatever format as long as everything is built in the right manner. You are actually able to manage a more complex business with less resources.”

Licensing Bootcamp

There are two steps to creating automated content management: creating and sourcing metadata. Whether standards come from EMA or from one of the stores like iTunes, there’s published information that license management technology references for distribution terms.

“We have an enormous amount of metadata,” says Biegun. “Each customer will look different; some of our customers have it sit in our system, other times it sits in our customers’ MAM [media asset management] or DAM [digital asset management].” When they go to package that content to push it to a third party, they have to check the rights and push the metadata and the physical asset together and ship that through their digital supply chain to the end recipient.

“No matter who you use, whether you go to us or one of our competitors or you build your own system, it’s really your OVP—any sort of commercial OVP already does this—needs to be able to be fed with this information. You can make an API call to set that up,” says Sid. “Or you’ll set up a watch folder and periodically push files into it that will get uploaded.”

One of the primary needs is how to identify a title, so one system can intelligently tell another system to make “video 123729” available, says Sid. “Obviously all the systems involved need to incorporate that decision and follow it, so you know that 123729 is season 3, episode 4 of Modern Family.Once you’ve done that, the rest is actually relatively straightforward.”

Social Video: Videocites

So what happens when content is shared without license? A startup called Videocites uses machine learning to identify all illegal content copies located across multiple social platforms. The company has developed a video-by-video search engine which crawls and indexes video content through the open APIs to platforms like Facebook, YouTube, Twitter, Dailymotion, and Russia’s VK using the visual information to make the search.

“Content owners can track, measure, and claim all their video duplications throughout all major social and video platforms,” says Eyal Arad, CEO and co-founder. Videocites’ tool provides analytics to allow content owners to see in real time what’s happening with their content, from short clips to longform content. “One of the largest of our MCN customers is Yoola, which is the 4th largest MCN [multichannel network] with around 50,000 channels,” Arad says.

“We are working with some of Hollywood’s largest studios, MCNs, sports firms, and other large content owners, providing them with both a one-stop-shop for automatic rights management and fast claiming (before the views grow on the duplications),” says Arad. “Our search is automatic and completely indifferent to the metadata and lingual changes of duplications, video manipulations, etc., finding full or partial duplications as well as compilations.”


While the concept seems relatively straightforward, the execution is a different story. One important question is when does it make dollars and sense to use technology to manage content licensing? This can be a delicate and proprietary question. How many times a piece of content is played is valuable information, and having a secure relationship with a vendor is a key part of the choice to use technology over human input.

Sometimes rights management is part of a larger software system, while other times it’s handled by a company specializing in this area. Either way, fitting all the pieces together is key to managing the data needed to both make direct-to-consumer services run smoothly and optimize profits.

As distribution channels constantly evolve, this side of the video ecosystem becomes vitally important. The idea that anyone would run a business now using manual control for very complex licensing agreements seems quaint. Of course, consumers don’t care who’s minding the store, they just want to continue viewing however and where ever they want.

[This article appears in the June 2018 issue of Streaming Media magazine as "Content Licensing: Who’s Minding the Store?"]

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