Eisner’s Vuguru Finds Its Groove

Michael Eisner’s newly restructured Vuguru studio has figured out how to profit from digital transmedia distribution without compromising story quality.

Eisner’s Vuguru Finds Its Groove

The explosion came out of nowhere–a man flies across a hallway in the background, while a teenage girl cowers in the foreground, covered with debris. “Aaaand cut!”


“That was so cool!” exclaims director Josh Stolberg, as he runs behind the video monitors to check the replay. “Let’s do it again!”

Stolberg’s enthusiasm is infectious. It’s an amazingly giddy set, considering the subject of this uber-indie project, Crawlspace–about a killer terrorizing a family living in his foreclosed house–and the take-no-prisoners shoot of 15 12-hour days. Star Steven Weber touches up his blood-stained shirt, while an actress models a knife embedded in her chest for an iPhone photo. “It’s for my kids,” she gushes.

“Our sets have been really happy places,” says Kristin Jones, chief creative officer of Vuguru, the studio that is both producing and distributing this film, not in theaters, but across digital platforms. “There is an optimism about this space that doesn’t exist in traditional features or TV. It reminds me of the early days of HBO, when budgets were tight and stars were bringing in their pet projects.”

Accounting for the giddiness is the speed and ease at which this project has come together–largely due to the studio’s self-financing structure–and a sense of trailblazing the future of media. Such projects typify the new incarnation of Vuguru – the digital multiplatform studio begun in 2006 by Michael Eisner’s Tornante Company, with an inaugural project, Prom Queen, that garnered 30 million domestic views and rolled out to 30 countries. In 2009, Rogers Media, the Canadian Internet, cable, and mobile phone conglomerate, bought a minority stake. That equity was used to build an executive team–mainly traditional media veterans–and finance several projects. The first out of the gate, the thriller The Booth at the End, became a critical hit despite solely streaming on in the U.S. Vuguru has another six projects, including Crawlspace , at various stages of post production, with another 10 planned for production this year. In addition, it will produce programming for Stan Lee’s World of Heroes YouTube channel that launches in April.

People Magazine picked The Booth as its top show to watch in its Pics and Pans list one week,” says Jones, who served as senior vice president of production and acquisitions at Miramax before coming to Vuguru. “The fact that mainstream publications are now acknowledging the merits of what we’re creating, saying ‘go watch this’ about something that’s not on NBC or HBO, is a real sign of success. It assured me we were on the right track–that people would get what we were doing and consume it in the way it was intended.”

The Business Model


Vuguru owns its projects–financing their writing and production–and licenses them to online distributors and other platforms in the U.S. (i.e. Hulu, Netflix, AOL, iTunes, VOD, smart phones, etc.); Rogers Media in Canada; and elsewhere, to multi-platform distribution companies with both traditional and digital outlets. The Booth, for example, streamed in the U.S. on Hulu, but in parts of Europe, aired as half-hours on television and streamed as teaser chapters online.

“A big studio wouldn’t do something like that, or might not be able to split up TV and streaming rights, because those rights might already be committed to one company,” says Vuguru president Larry Tanz. London-based distributor Content Media–on the basis of The Booth’s success – even went as far as to buy up international distribution rights (outside North America) for 10 upcoming projects over the next two years. “So now we have pre-commitments and pre-payments for distribution on 10 projects currently on the roster.”

Re-Shaping the Creative Product

Financial and distribution models have also re-shaped the script structure. The average cost for the seven projects shot last year, including Crawlspace, was $500,000. The Booth’s two hours cost about $300,000. An upcoming 90-minute thriller, The Millionaire Tour, was made for under $1 million. “Because of the small budgets, we can’t rely on special effects,” says Tanz, the former CEO of Live Planet, which ran Project Greenlight. “It boils down to story.”

Vuguru projects are shot like films based on 120-page screenplays that are written with natural break points. So they can be shown as a 90-minute film, broken into half-hour TV episodes, or 10 to 15, six- to 10-minute online segments. The breaks also facilitate ad placement.

“We’re not making 12 half-hours. We’re making 90 minutes of something, but selling it like a TV studio,” says Tanz. “Nor is it a farm club to test out a concept. We’re not hoping to eventually make a $50 million film version or network episodic of Crawlspace or The Booth. If a network or studio approaches us about that, great. But it’s not what we’re setting out to do.”


Appealing to Veteran Talent

What Vuguru lacks in budget it makes up for in actually being able to greenlight projects. The Booth, Millionaire Tour, and Crawlspace have taken under a year, from concept to script to final production.

“The ability to get a project made is attracting industry veterans,” says Tanz. Instead of years getting a project to the screen, “they appreciate the value of `Hey, I like this, I’m gonna write you a check.’ People are also interested in a new model of distribution, by which your project can reach millions of people in the world relatively quickly, instead of spending two years on the festival circuit playing to a smaller audience.”

The digital landscape is not only facilitating creative distribution platforms for the studio, but offering up non-tradition means of talent scouting. “It’s no longer a case of going to film festivals and finding a great filmmaker,” says Jones. “If you do something inventive enough, and put it online, you can make a name for yourself. We’re trying to figure that out, and create content in a way to put it out there in a compelling manner. You never know where the next great creator or idea will come from. The Internet has become the great leveler.”

For Crawlspace’s veteran filmmakers, Vuguru offers a chance to expand their professional bases. Mike Karz is an established producer who wanted to explore the new digital medium, while Stolberg, an established screenwriter, is trying to build a directing portfolio. They’ve worked together on films for a couple of decades, including Lionsgate’s Good Luck Chuck and Summit’s Sorority Row.

“Josh is enormously talented and I wanted to support him as he pursues a directing career,” says Karz. “I view it as a challenge to make a movie for the digital medium, because not all stories are suited for it. Younger people are using this media and comfortable watching content on smaller screens. As a producer, it’s increasingly more important to learn how to create for this space.”


Stolberg sees burgeoning creative possibilities in developing ideas for a nascent industry. “The stakes are so high in big budget movies that no one’s willing to take real chances,” he says. “The nice thing about Vuguru and working on a smaller scale, is it gives you the opportunity to find a unique vision and do something a little different. Especially for that kind of budget, you can’t come at every scene with conventional coverage. We have to come up with alternative ways of shooting. Out of that comes…unconvention.”


About the author

Susan Karlin is an award-winning journalist in Los Angeles, covering the nexus of science, technology, and arts, with a fondness for sci-fi and comics. She's a regular contributor to Fast Company, NPR, and IEEE Spectrum, and has written for Newsweek, Forbes, Wired, Scientific American, Discover, NY and London Times, and BBC Radio.