- Film libraries have become increasingly valuable in recent years with hundreds of millions of dollars being paid for film assets over last 12 months
- The Movie Studio has sought to augment its film library through purchase of various motion picture films in last 5 years
- Increasingly, VOD platforms and cable tv channels are competing to license unique film, tv show assets in bid to increase subscriber base
- With movie assets commanding higher licensing fees and sale prices, MVES is poised to benefit from revaluation of its film library assets
In late October 2019, Lakeshore Entertainment, a 25-year old independent film studio, agreed to the sale of its 300-title film and TV library and international sales operations to Vine Alternative Investments for a gross monetary consideration speculated to be around the $200 million mark (http://ibn.fm/LEGSz). Similarly, The Movie Studio (OTC: MVES), an independent motion picture production company based in Florida, has long based its business model on the purchase of legacy film libraries which have been upgraded to 4K resolution along with the re-monetization of new content on popular video on demand (“VOD”) streaming platforms. With film content and distribution rights becoming increasingly valuable as streaming platforms compete to attract viewers through the provision of unique licensed films and TV shows, The Movie Studio stands to benefit from the revaluation of its media library.
The Movie Studio has been an avid purchaser of film libraries over the past decade. In 2015, the company purchased a 60% stake in the Seven Arts film library, which included films by top Hollywood stars such as John Goodman, Ving Rhames, Burt Reynolds and Tim Robbins (http://ibn.fm/QeR0E). The purchase was followed up by a subsequent acquisition in 2016, with The Movie Studio arriving at an agreement to acquire a 12 major motion picture library from the Arrowhead Target Fund, including films such as “Johnny Mnemonic” starring Keanu Reeves, “Never Talk to Strangers” featuring Antonio Banderas, and Clive Owens’ “I’ll Sleep when I’m Dead” (http://ibn.fm/QbRvC).
The proliferation of streaming outlets and television channels seeking new content has led to a virtual ‘arms race’ in terms of licensing media content. “[Film] libraries run forever,” says Scott Kennedy, president of worldwide marketing and distribution at Forrest Films (http://ibn.fm/pm2fI). “As the studios launch their own streaming services and pull their films off Netflix and Amazon, those guys are going to be even more hungry for content.”
The rapid proliferation of new VOD platforms has meant that sellers can now license their film assets on multiple occasions, with major Hollywood film studios now attributing a significant portion of their revenues through licensing deals. “In the U.S. now, we are selling our titles by the month,” said Chris Ottinger, president of worldwide television distribution and acquisitions at MGM. Ottinger added that the studio had witnessed double-digit growth in licensing sales for its back catalog across streaming VOD, premium and cable over the last 12 months. “It’s not uncommon to do 10 to 15 different licensing deals for a single title in a single territory.”
The Movie Studio has followed this trend, with the film studio’s latest releases available on platforms such as Showtime, Comcast, Amazon Prime and Tubi TV in addition to MVES’s foreign licensing deals, which has seen it already exclusively license several of its films for the territory of Australia over the past quarter (http://ibn.fm/owEPB).
With film libraries becoming increasingly valuable in today’s content driven market – most recently shown when ViacomCBS purchased a 49% stake in Miramax’s 700 film library for a record $375 million last December (http://ibn.fm/M1zUE), the Movie Studio’s commercial strategy has the company well-positioned to benefit as VOD platforms and cable television compete for their viewers’ attention.
For more information, visit the company’s website at www.TheMovieStudio.com.
NOTE TO INVESTORS: The latest news and updates relating to MVES are available in the company’s newsroom at http://ibn.fm/MVES