In November 2010, Amazon Studios launched and opened its doors to allow anyone with a movie idea to submit a script to potentially be developed at the studio. After 7.5 years and over 27,000 submissions for both TV and film, Amazon pulled the plug on the project in April 2018 [1]. Why did Amazon Studios launch this open innovation platform for content creation? How did it work and why did they end the project? Were they right to stop crowdsourcing scripts for future development?<\/p>\n
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User-generated and crowdsourced content such as videos, blog posts, product reviews, etc. has been a key driver of building online platforms such as Wikipedia, Facebook, Yelp, and YouTube. Open innovation can create strong network effects with the virtuous cycle of users creating, reviewing, and consuming content. Studies have shown \u201can evidence based causal link between user generated reviews and product demand\u201d [2] which Amazon has seen first-hand on their eCommerce platform.<\/p>\n
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Since its founding, Amazon has been leveraging a wide consumer base to harvest data in both buying behavior and user-generate reviews. This data has been used to develop recommendation algorithms, create web-based business solutions (AWS), and point to new investments (Amazon Basics). When Amazon Studios was founded, Amazon had been a pioneer of distributing \u201cuser-generated content\u201d with both books through their self-publishing platform AmazonEncore [3] and via the Amazon marketplace. Using consumer generated content in the form of books, products, and product reviews had allowed Amazon to generate sustainable network effects for its platform. As they developed a studio business, they hoped to do the same with video.<\/p>\n
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For a studio, crowdsourced content can be an inexpensive, wide-reaching funnel for innovative new ideas. In traditional film and television development, established industry stakeholders (e.g., agents, managers, talent, guilds, producers, etc.) and competitive bidding processes for projects create barriers to entry for new writers and high costs to develop a traditional project. With their open innovation platform, Amazon Studios could bypass many of these middlemen and avoid competitive bidding processes altogether.<\/p>\n
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Amazon Studios\u2019 plan was to option roughly one promising project from the user-generated pool per month for $10,000, and pay the creator $55-200k if it was picked up for a full budget TV series or film [4]. To evaluate and find the best projects, Amazon Studios\u2019 developed crowdsourced feedback mechanisms for evaluating scripts. Creators would post their ideas for open feedback, allowing for constant iteration and improvement [5]. Amazon Studios could then simply look at the most popular ideas for development.<\/p>\n
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The short-term strategy was to cast a wide net for ideas, allowing users to decide for themselves what should be made. At every stage, consumer input was solicited to drive user-based decision making. Medium-term, Amazon Studios was hoping to drive buzz around greenlit projects from user-generated content, ideally to drive subscribers to its Prime Video service. In 2013, Amazon Studios made available 14 pilots for customer feedback and open innovation [6]. Further, the project led to new product development for the creative process including Amazon Storywriter and Amazon Storybuilder [7].<\/p>\n
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In 2018, Amazon Studios shut down their script solicitation and pilot feedback program. Reports noted a shift in strategy with an eye towards efficiency and more traditional approaches to content development [8]. The decision also came in the wake of new studio head Jennifer Salke replacing Roy Price, a champion of the crowdsourcing project [9].<\/p>\n
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Why wasn\u2019t the crowdsourced content and open innovation platform successful for Amazon Studios? Early in the project, when comparing Amazon Studios\u2019 approach vs Netflix with House of Cards<\/em>, Roy Price claimed, \u201cIf you’re betting on one show, it’s got to be right down the middle of the fairway, but if you’ve got 14, you can allow people to try new things” [10]. Unfortunately for Amazon Studios, what competitors Netflix, Hulu, and HBO found were subscribers being driven by those single, big bet shows [11].<\/p>\n <\/p>\n Premium entertainment content for subscription services uniquely seems to be at direct odds with the benefits of open innovation, potentially due to the power of storytelling coming from singular unique voices and the fact that creating original scripts is incredibly hard \u2013 similar to developing high fashion or breakthrough innovations, consumers may not know what they want before they see it, ultimately at odds with a crowdsourced script platform. My recommendation for management would be to leverage user-driven innovation for lines of business where volume and scale of content or products (such as their marketplace) benefits from user-input and open innovation.<\/p>\n <\/p>\n Open questions, though, are: Would there be potential spots further down the innovation funnel where crowdsourcing content could work for the studio business model? Should Amazon Studios have kept the program merely as a marketing and PR stunt? And could this open innovation platform be better used or developed at a different content creation company?<\/p>\n <\/p>\n <\/p>\n (Word count: 739)<\/p>\n <\/p>\n Sources:<\/p>\n <\/p>\n [1] Todd Spangler, \u201cAmazon Studios Shuts Down Open Script-Submission Program,\u201d Variety, April 14, 2018, https:\/\/variety.com\/2018\/digital\/news\/amazon-studios-shuts-down-open-script-submissions-1202753480\/, accessed November 2018.<\/p>\n <\/p>\n [2] Michael Luca, Handbook of Media Economics Volume 1, Chapter 12: User Generated Content and Social Media<\/em> (Elsevier B.V., 2015), PDF e-book, page 571, accessed November 2018.<\/p>\n <\/p>\n [3] Bob Minzesheimer, \u201cAmazon gives the self-pubished a second life,\u201d USA Today, February 3, 2010, http:\/\/usatoday30.usatoday.com\/life\/books\/news\/2010-02-04-amazonbooks04_ST_N.htm<\/a>, accessed November 2018.<\/p>\n <\/p>\n [4] \u201cWriters, animators and filmmakers around the world are now invited to submit comedic and children’s series proposals,\u201d Amazon Studios press release (Seattle, WA, May 2, 2012).<\/p>\n <\/p>\n [5] Richard Lawler, \u201cAmazon Studios expands into TV series, looks to load up on content for streaming,\u201d Engadget, May 2, 2012, https:\/\/www.engadget.com\/2012\/05\/02\/amazon-studios-expands-into-tv-series-looks-to-load-up-on-conte\/<\/a>, accessed November 2018.<\/p>\n <\/p>\n [6] “What the TV Biz Could Learn from Amazon Studios”, Variety,\u00a0\u00a0https:\/\/variety.com\/2013\/biz\/news\/amazon-viewer-data-for-development-process-1200429921\/<\/a>, accessed November 2018<\/p>\n <\/p>\n [7] https:\/\/techcrunch.com\/2015\/11\/19\/amazon-studios-launches-amazon-storywriter-free-cloud-software-for-screenwriters\/<\/p>\n <\/p>\n [8] https:\/\/www.engadget.com\/2018\/04\/14\/amazon-studios-ends-open-call-for-scripts\/<\/p>\n <\/p>\n [9] https:\/\/www.marketingdive.com\/news\/amazon-studios-drops-the-curtain-on-open-script-submission-program\/521369\/<\/p>\n <\/p>\n [10] http:\/\/www.thesunchronicle.com\/news\/business\/amazon-seeks-consumer-input-on-shows\/article_4296ad1a-91b3-5e41-bb4d-c186cd8bf751.html<\/p>\n <\/p>\n