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What better place to launch a new venture than in the middle of a business you plan to at least disrupt and possibly displace.
That’s the plan for the Digital Film Cloud Network that is launching Wednesday at the American Film Market as a platform for year round buying and selling movies in every territory on the globe.
“The competition that gets displaced over time will be in physical markets,” says founder and CEO Ray Bell, “but this is an industry where people do face to face. It never going to go away but we can remove a lot of the intensive manual processes which are costly; and at the same time provide a real service.”
After a little more than two years of development, following a Beta launch at the Cannes film festival, DFCN hopes its state of the art software platform will be the way byers and sellers trade global film rights in the future.
“We are technology people building software for the movie industry,” says Bell. “We are not movie people trying to build software.”
Bell’s background is in Silicon Valley where he worked for Oracle Corp., Cisco Systems, and others. In the past few years he has launched a series of start-ups including Silver Spring Network and Computer Power Group.
Two and a half years ago Bell joined with Alfredo Guilbert, who has a background in advertising, investment and business management, to see what they could do in the film industry. As Guilbert puts it, they felt they could bring the movie business out of the horse and buggy era.
“We looked at the film industry,” says Bell, “given that digital disruption was on the tipping point from a business perspective and saw an opportunity. You get moments in time you can enter these new businesses and that’s what we think is happening right now.”
They did research and pulled together an advisory and consulting group that includes producer Hawk Koch, former talent agent and international sales consultant Hal Sadoff and exhibition exec Ray Syufy, former CEO of Century Theaters.
“We went through a process,” says Bell, “where we started to understand this industry.”
After about 20 months of development, they brought their software to Cannes last May with about 500 films for a beta launch. They came away with commitments to put 5,000 movies on their non-exclusive platform.
It is free to use the system. If there is a transaction, the seller pays six percent of the value of the transaction when the money actually is paid.
There are others doing similar systems including RightsTrade and Screen Hits; and there are some who have come and gone.
“People have tried this in the past and failed,” admits Bell. “Our belief is the technology wasn’t ready. The market wasn’t ready.”
DFCN has about ten private investors and is looking for more, although Bell says they are well capitalized. Bell won’t disclose the amount raised or the names of investors but says none are venture capitalists.
The value of the system, says Bell, will grow over time. He expects it to expand the sales of movies and provide “long tail revenue that is locked up and languishes.”
They also think as wireless grows into a significant platform for people to watch movies there will be a need for a faster, more efficient, secure way to trade movies to meet the growing demand.
“The disruption is that we are going to help you find that needle in the haystack,” says Guilbert. “We’re going to give you the tools to get the movie you want when you want it and the way you want it. “
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