Dear VidAngel customers,
Some of you have asked why we filed an antitrust suit against the studios. Here’s the simple answer:
Hollywood claims we don’t pay them for their movies. But the truth is, they refuse to accept our payments. (We still pay them though. Read on.)
Beginning in 2014, VidAngel tried to pay the studios 4 different ways. Not only did they reject every one, but then they sued us for allegedly not paying them. So Hollywood’s like the teenage girl who keeps turning down the nice guy, then complains that he never asks her out, then sues him for copyright infringement.
Look, we love Hollywood. We’re glad they make movies. But the fact is, they seem to be working to shut down the filtering industry. Here are the 4 times they rejected our payments.
Method 1: Traditional streaming license
VidAngel offered to buy traditional streaming licenses from the studios, but the studios said no. We get it — why partner with such a small company? Except we also reached out through a bigger company called Google. (A cool emerging tech company. Bing it.)
Google approached the studios with a plan to add VidAngel filters to Google Play movies, potentially bringing millions of new viewers to the licensed Google Play streams. The studios turned them down almost immediately.
And bear in mind, the U.S. filtering market is estimated at over 60 million people, according to National Research Group. So if Hollywood said no, they likely either…
- Want to block the filtering industry from entering the streaming age, OR…
- Want to avoid money and its corrupting influence
For now, we’ll give the benefit of the doubt and say #2.
Anyway, we also tried…
Method 2: YouTube extension
We created a platform that allowed viewers to buy a movie on YouTube, then buy the filter at VidAngel and add it to the movie. We hoped to bring Hollywood more money by attracting new viewers to their content.
Then the studios told Google (YouTube’s owner) that collaborating with VidAngel was a violation of contract, and forced them to withdraw crucial tech support. All of a sudden this model wouldn’t work.
“Wow,” we said. “We admire Hollywood’s moral commitment to not making money.” It certainly explained the release of Fantastic Four.
Nevertheless, we kept trying.
Method 3: Buying discs straight from the studios
This time we wrote to the studios asking to buy DVDs and Blu-Rays from them directly, so our customers could buy and sell back those movies online. This model would make money for Hollywood on each title, without giving a cut of sales to WalMart.
Some studios said no. Most never responded.
“Man,” we said, “their hatred of lucre is incorruptible. No wonder they can’t afford to pay actresses the same as actors.”
So nowadays we use…
Method 4: Our current model
VidAngel now buys DVDs and Blu-Rays from retail stores, then sells movies directly to customers. Hollywood gets reimbursed by the sheer number of movies we buy (we spend around ⅓ of our revenue on discs). And every VidAngel movie being watched is a licensed copy. It’s literally the only legal model that doesn’t require Hollywood’s cooperation.
We felt proud of ourselves for finding a way to pay Hollywood, despite their best efforts to not be paid. Then they sued us.
And here’s where things really get ironic.
Not only did the studios show significant hypocrisy in suing VidAngel for not buying licenses that they refused to sell — but they also claimed that Method 4 was illegal and that Method 2 was the legal way to filter streamed movies. To which we said, “Homeboy, we tried Method 2 and you shut it down!” We’re paraphrasing here.
Hollywood also implied that they sued us as soon as they learned we were using Method 4. The truth is that Albert Podrasky, Disney’s director of anti-piracy, has been using a secret VidAngel account to monitor us for a full year! (Though we’re not sure we understand his job, ‘cause he never watches movies about pirates.) The point is, it seems like Hollywood didn’t sue till we were getting too big for their comfort.
Anyway, the studios’ lawsuit has made us question our base assumptions. Maybe Hollywood actually likes money, and they’ve been shutting us down because they hate filtering. If that’s the case, we respect their opinion — filtering’s not for everybody. But they should come out and admit that they hate filtering, instead of pretending the case is about money.
In short, it seems to us that Hollywood is colluding to undermine the filtering industry — despite Congress passing the Family Movie Act to make that industry a reality. (In fact, Congress passed the law because Hollywood was trying to crush filtering.) That’s why we filed an antitrust counterclaim.
So that’s the scoop, VidAngel fans. Wish us luck in the antitrust suit. In the meantime, keep watching movies. We’ll keep you posted.