A commodities-style exchange desiogned to take a percentage of the equity in a given media asset, break the media asset into individual component parts (such a commodities-style contracts), and then float these contracts to potential buyers, sellers and speculators by way of offering means, methods and tools found in the world of Futures trading.
Within this process of floating these contracts, distributors are allowed to buy contracts, and if they buy a pre-determined number of contracts and hold these contracts until settlement, they will receive two benefits as follows:
- Exclusive or Non-Exclusive Distribution Rights within their discrete territories (depending on the number of contracts purchased)
- Backend equity within these media assets as defined within the contracts (allowing proportional revenues to be distributed to these same distributors.
- Valuable Ad Avails as provided by Platform Operators (cable, satellite, internet, IPTV, mobile etc.)
- Valuable Risk Management means, methods and tools
A joint venture with Pride Holdings, LLC. a company that has extensive knowledge in developing and managing commodity exchanges around the world. The exchange will be a cooperative effort by and between Modern Cinema, Pride Holdings, LLC and the Pride Group tolaunch a first of its kind international futures exchange allowing individuals to buy and sell fractional interests in movies, television series and electronic games.
Over the last three years, Modern Cinema Group has developed systems and networks for the efficient distribution of valuable media assets to international platform operators (streaming services, mobile, cable and satellite TV) with a particular focus on the needs of mobile carriers. The Pride Group based in Dubai with 2 billion USD under management has been operating their own futures exchanges around the world for more than 20 years. This partnership allows the two groups to leverage intellectual properties, technologies, manpower and exchange networks for the benefit of those involved in the media production and distribution industries.
Chaired by Her Excellency Shaikha Moaza Obaid Suhail Al Maktoum, The Pride Group is a nonbanking, private network of multi-national companies headquartered in Dubai, UAE. Founded in 1986, Pride has built a corporate community of over 10,000 employees, more than 3,000 independent representatives and affiliates, and a network of brokers all benefiting from Pride’s brand recognition and ever-expanding reach.
This new futures exchange offers up to 50% capital financing for media productions under $100 million USD. On the other end of the distribution supply chain, platform operators can purchase “contracts” that combine territorial license rights with fractional equity ownership. The introduction of an equity component helps operators to further monetize popular content titles in an effort to reduce acquisition costs that have been spiraling out of control for decades. Additionally, platform operators are encouraged to contribute ad “avails” (or ad spots) that can be synchronized to systematically increase awareness around the world.
The Modern Cinema Group model is based around a futures exchange, and futures exchanges, by law, are restricted from favoring one trader over another, and can assume no risk whatsoever. This means no media czar will ever emerge (in the fashion of iTunes or Netflix). When sophisticated trading strategies are initiated, powerful trading positions can be leveraged by those who have in-depth knowledge of the industry. Advantages are then shifted from “influence peddling” to “industry savvy”. Those who are able to effectively trade contracts will gain advantages by way of adroit execution which is consistent with contemporary economic trends (as popularized by the movie Moneyball). This is very different from the environment most Hollywood insiders are familiar with today.
In addition, the exchange makes it possible for private (non-industry) individuals to buy fractional interests in movies, television series and electronic games, and become arm-chair producers. These speculators will be encouraged to trade by way of social media campaigns and user-friendly interfaces. More about this aspect of the model will be announced in the near future.