DirecTV has made a deal with independent movie studio A24 to co-finance and market its films in exchange for exclusive rights to premiere them through DirecTV’s video-on-demand service one month before they hit theaters. DirecTV is initially committing about $40 million to financing A24 films.
The partnership could prove mutually beneficial for both DirecTV and A24. Exclusive content gives DirecTV an opportunity to distinguish itself from competitors (which is perhaps why the company made a bid for Hulu earlier this year). And A24, which has put out films from indie-darling directors like Harmony Korine and Sofia Coppola, will be able to put out more films by splitting costs with DirecTV, as well as gain access to the satellite operator’s 20 million pay-TV U.S. subscribers.
Because the movies are premiering first on VOD, major theater chains including Regal Entertainment Corp. won’t play them, meaning A24 will have to book them primarily in independently owned cinemas. After as long as two months on the big screen, the films will then become available to other on-demand services run by pay-TV and Internet companies. The two companies will split revenue from all distributors.