Culver City, Los Angeles, California, is a satellite city that closely combines nostalgia with current trends. Like Burbank, it brings together many large and small film companies in Hollywood, the most famous of which is Sony Columbia Pictures.

Robert Lee sat in a cafe on West Washington Avenue and asked the waiter to renew a cup of coffee for Chris across from him.

"The copyright of the new videos of Sony Columbia Pictures, as long as the price is appropriate, authorization is not a problem." Chris added sugar to the coffee and said, "If you want to do this, Sony Entertainment is willing to cooperate with you."

Robert Lee smiled and said, "Can a written agreement be reached?"

Chris thought for a while and said, "No problem. Ronan and I are old friends, so I can introduce you to you."

Compared with the traditional offline disc and video tape market, Sony Columbia's business volume is not large in terms of Internet licensing, and the current market size is limited. Chris is very clear that if the price is appropriate, it is not a problem for the company to hand it over to Ronan's Internet company.

Robert Lee said: "This is a win-win cooperation. Netflix is ​​far ahead in the Internet DVD leasing industry, and its performance in sales is second only to Amazon."

It is in the same circle as Hollywood, and it is very convenient to talk about many things. Chris didn't go around the circle and said directly: "Robert, the Netflix website that Ronan has acquired is the leading position. The main reason is that the industry is already small."

This is not the first company authorized by Robert Lee. He has contacted several companies including Warner Bros., and he has a similar view. He smiled and said, "Netflix is ​​a new company and it will take some time to develop."

The authorization negotiations between Netflix and Ronan and the industry companies did not encounter much difficulty. As a company in the Hollywood circle, it is not difficult to obtain the relevant authorization of new films in the industry when the price is appropriate.

The reason why it went so smoothly is mainly because the licensing fees for new Hollywood movies are very high.

Because of Ronan's relationship, Chris and Robert Lee were also familiar with him, saying: "In this way, wait for me to notify you, and then ask your person to discuss specific details with the Columbia Pictures' copyright department. I can't guarantee anything else. It is not a problem to license Sony Columbia Pictures' new movies in the next five years."

Robert Li Dui smiled and asked, "Can you find a clear idea of ​​the cost?"

If it is a company outside the circle, Chris would not say anything, but this kind of thing is not a secret in the circle. The six major companies have tacit standards.

Chris shook his head: "You don't know, why ask again?"

Robert Lee said: "Netflix is ​​a new company, with limited funds. The wholesale price of a single unit of $10 is still a bit high. In addition, there are related authorization fees..."

"You will talk to the Columbia Pictures Copyright Department." Chris said directly: "$10 is for the wholesale price in the Hollywood circle. Robert, if you and Ronan are not part of the Hollywood industry, the wholesale price will not be less than $15."

Robert Lee nodded gently: "Okay, let's talk to the people in the copyright department for details."

He knew that it was unlikely that he would lower the price any more. After all, he was talking about new films launched by Sony Columbia Pictures in the future, not those outdated old movies.

If you want to win the latest film in the future, the price you pay is definitely relatively high, but new films also have an advantage. The licensing fee can be distributed to the commission for each DVD rental, thereby reducing the company's huge initial investment and effectively alleviating financial pressure.

Chris suddenly said: "It is very important to do leasing business. Are you only interested in new movies?"

Although I have never been exposed to Internet rental business, I think I should have something in common with store rental. There are only a few movies, even if they are the latest popular movies, they cannot continue to attract customers.

"The price of old movies is too high." Robert Lee said: "Not only is it the same as new movies, it is also impossible to choose from. Good movies are packaged with bad movies..."

Chris was not embarrassed at all: "Don't we all do this?" He said deliberately: "A few years ago, Ronan sold me overseas distribution rights, and it was also a good movie with a bad movie."

Robert Lee was speechless for a moment, because of similar things, Relativity Entertainment did a lot.

Everyone is a good guy, and there is no need to say who is.

"If the price of old movies can be lower than $5," Robert said: "We will package the Sony Columbia Pictures' library directly."

Chris shook his head directly: "You know this is impossible."

Robert Lee looked at the time and decided to end the interview, saying, "Chris, thank you very much for your help."

Chris shook hands with him and said, "You're welcome, this is a win-win situation between Sony Columbia Pictures and Relativity Entertainment, and I have been friends with Ronan for many years."

He asked with concern: "How do you plan to solve the film source? Relying on new films alone cannot support the rental business, other Hollywood companies will not be cheaper than I said."

Robert Lee knew Chris was out of good intentions and said, "Ronan has already thought about it."

Chris didn't say more: "Wish your business a smooth ride."

"Thanks."

There is indeed some preparation in this regard. Robert Lee has collected a large amount of relevant information. Some things cannot be obtained from Hollywood-related companies. Since the popularity of videotapes, Hollywood film companies have taken out old films with gray and moldy films in their film libraries, and profited from the family entertainment market through direct distribution or various authorization methods.

Especially when the video tape industry was extremely prosperous in the 1980s and 1990s, there were many companies that obtained the right to rent and sell a large number of old movies.

Not every one of them is as successful as Pepsika and Hollywood videos.

In the next few days, Robert Lee represented Netflix and Relativity Entertainment, and made a preliminary end with more Hollywood movies.

Relativity Entertainment reorganized the former legal department and copyright department, merged Robert Lee's team into the legal department, and Robert Lee served as the director, specializing in copyright and legal business.

Robit Lee also took on more work, and this time Ronan left him with full responsibility for the negotiations with the Hollywood industry.

The main purpose is to negotiate the purchase of new DVDs from medium and large Hollywood film companies and related copyright licensing issues.

Most of the negotiations went smoothly, especially the six major Hollywood companies. As long as the price is right, they will not exclude cooperation with companies in the industry.

After Robert Lee reached a few points of agreement, he quickly sent Netflix the problem, which was a problem of funds. If Netflix bought DVDs for $15, these film companies led by the six major Hollywoods would not reject them at all.

But this price is something Netflix could not afford before.

Negotiations were not smooth, and there were also many companies that were not particular about Hollywood. When Robert Lee contacted Xinyi Film, he didn't know if Xinyi Film proposed unacceptable conditions because of the huge confidence brought by the success of "Lord of the Rings: Rings Team".

Xinyi Films can reach a future Internet license with Relativity Entertainment, but there is one condition: Xinyi Films will participate in the investment in two sequel movies, "Spy Movie 2" and "Human Clearance Plan 3".

Robert Lee directly refused, this was simply a cake for relativity entertainment.

"This is not that Relativity Entertainment and Netflix have any desires for New Line Film!"

Such irrational request also made Robert Li push back: "This is a brand new peripheral sales channel, cooperation is a win-win situation and can increase the revenue of Xinyi Film in peripheral copyrights!"

In addition to Xinyi Film, negotiations with Lionsgate Pictures and DreamWorks were also not going well.

Lionsgate Films made similar requests to New Line Films, and DreamWorks' Spielberg directly refused to cooperate with Relativity Entertainment.

While the negotiations were underway, Robert Lee had several contacts with a man named Stewart Coleman.

This was specifically explained to Ronan before he went to San Francisco.

Stewart Coleman's Reo Video Services is an option Ronan has prepared to solve the Netflix film library problem.

A large amount of information has already been in hand by Ronan, and Ronan also communicated with Mark Randolph. As planned, Netflix bought DVDs in film and television works and obtained relevant authorizations.

The first is to talk directly about the film companies led by the six major Hollywood film companies, who are the copyright owners.

The second type is to talk to PepsiCo. Apart from new films in recent years, PepsiCo has the authority to re-authorize those old films.

This is also the choice made by major Hollywood companies before when they did not have sound video peripheral channels and fully distributed goods in North America.

To put it bluntly, it means selling the manufacturing company to big agents, and then relying on the big agents to sell it to small dispersed agents.

But Ronan's research found that there is a third option - buying a rental company with numerous video licenses.

Looking across the United States, PepsiCo is a super giant in this industry, followed by Hollywood video companies, and there are countless companies engaged in related businesses, both large and small.

Some of these companies developed well in the 1980s and 1990s and could directly discuss peripheral copyrights with Hollywood companies.

But some companies have developed, while others have declined over time.

Stewart Coleman's Reo Video Services Company is headquartered near the University of Southern California. It mainly carries out videotape chain rental business in the Southern California area, with a total of up to 18,500 film and television works from all over the world.

However, Reo has been on the decline since 1998, and the situation is not good now.

The reason why this company is going down is interesting - they are engaged in almost the same business as Netflix.

In 1998, Stewart Coleman also discovered Internet business opportunities and used the copyright in his hand to create a Ruio online store to engage in video rental business.

Both parties invested heavily in this business, but Ruio and Netflix have completely different choices of rental materials. Netflix chose DVD discs that represent development trends, while Ruio used bulky and gradually outdated video tapes.

Perhaps it is the difference between videotapes and DVDs, or perhaps it is the difficulty of starting a business in Hollywood's surrounding industrial companies in the Internet. After several years of development, Ruio has only 20,000 registered users, which is only one-tenth of Netflix.

(Rio, a company that exists, has licenses for 18,500 videos and videos, and was later swallowed up by Hollywood Video for $100 million.)
Chapter completed!