National Film Hire.

This has been in development since Jan 2006 and its to be my own online dvd hire business.

Monthly subscriptions would be £5 for one dvd at a time, £7.50 for two dvds at a time and £9 for three dvds at a time (unlimited rental).

Do you think i am undercutting price too much?
And the name "National Film Hire" does that sound alright?

On monday i have an appointment to see a web designer at Kingston Communications plc and i expect the business venture will be very expensive.

Best of luck Eddie!

Ok...i had a discussion with a couple of web designers from Kingston Communications (KC) last monday morning about setting up National Film Hire, my online dvd rental business venture, and the quote for setting up the website was estimated between £15,000 to £20,000, which confirmed my earlier suspicion of an excessive cost!

They mentioned they would love to set up the website as it will look good on their portfolio and i would need to draw up a detailed business plan, a flow chart of how i would like the website to work and will put me in touch with someone called Bill Tyson who could raise funding this business venture.

Now KC rang me up today saying the quote is not as excessive as initially thought and will now cost £10,000, however i still feel this quote is expensive and i cannot imagine any business grant will fund £10,000.

Therefore i feel the softly softly approach is probably the best method and for a start i already have two garages near my house with plenty of space to build up a large collection dvds...

Well you are talking about a netflix'ish style website right? You want there to be images, searches based on keywords, titles, themes, etc, right? You'll need all dynamic content with new releases given exposure on the homepage. Could I, as a filmmaker, pay to have my film publicized on the homepage?

It's a big undertaking. Who will keep it updated with new content?

Although 10,000 US or EU or Pounds is a bit excessive, IMHO.

Yes i totally agree £10,000 ($20,000) is very excessive! So if you know of a cheaper alternative please do let me know...

The content for the home page will list all the genres with the favourites below it (ie 100 top comedies) on the left, and in the centre the basic details are

- From £5 per month
- Keep each dvd as long as you wish -- Free postage both ways 1st class
- No hassle, no queues
- No contracts and cancel anytime
- Learn more
- Sign up

1. Select 2. Recieve 3.Watch 4. Swap
Choose online 1st class to at your post back for
your door convience free.

Choose your plan!

3 dvds at a time Unlimited rental £9 per month
2 dvds at a time Unlimited rental £7.50 per month
1 dvd at a time Unlimited rental £5 per month

I have not yet considered advertising individual film titles via the home page however i would gladly upload your film and how much the filmmaker is paid depends on how often i can sell the film.

The question is, how much do you have in your budget for the website?
Then, how much do you have in your budget for advertising? You have two markets to advertise to, the filmmakers AND the viewers.

I think that you're still looking at $5,000 for a simple site.

The content for the home page will list all the genres with the favourites below it (ie 100 top comedies) on the left,

Click to expand...

WOW! That's going to be a very long homepage. Tooo long. I mean how many genres are there?
Comedy, Action/Adventure, Sci-fi, Drama, Thriller, Horror, Suspense, and a LOT more.
From what I've listed there will be 700 films listed on the homepage! That's WAY too much.
You'd have to scroll down page after page to find something.

The problem is that not only do you need to design the site, but also the backend database, and code to pick which items are displayed.. also if it's like netflix, you'll be displaying suggested titles based on previous rentals, and that takes more custom programming.

That is a big chunk of time and money doing all that development and populating the database, etc.. but then you also need a very good server dedicated to hosting this. Probably load balanced redundant, on at least a T1 connection. This isn't the kind of thing you can realistically throw on your local 'godaddy.com' equivelant.. You'll be looking at a dedicated server, and the works. That aspect of it can get spendy too, and it isn't a one time deal, but a recurring issue.

Here's the deal. I think it's a good idea. Clearly it's a business model that works as both Netflix and Blockbuster are doing plenty of business here in the states. However, quite honestly I would have to say that you're getting way ahead of yourself here. The first thing you need to do is write a solid business plan. In doing that writing, you will be researching the market, and as such will learn many things you probably hadn't yet thought of. You will also want to really investigate the cost of running a website of this magnitude, as those costs will need to be shown in the business plan, and you will need to be able to show that you can and will (and how you will) generate more income than those needed expenses.

If it looks good on paper, you should have no problem finding some venture capitalists to throw some coin at you. Like I said, it's a good idea, you're just not prepared to jump in yet.

A major part of writing a business plan is the market research and competition research. If you haven't done that, then I'd stop now and get going on that.

One thing that you need to do is have a relationship with your host. Make sure that your service is scalable. Perhaps you could be on a shared account now, as long as you can scale it up to dedicated without problems. You'll need to figure out how many movies you need to sell in order to cover your expenses. Also, what is your advertising budget? Again, you need to market to two different markets, Filmmakers and Consumers.
1) you need films from the filmmakers so they could make money
2) you need consumers to rent the filmmakers' films
3) you can't get consumers unless there's films
4) it's hard to get filmmakers if there's no consumers

It's a tricky balance and the above is in no specific order.

The main thing you need is a SOLID foundation. That foundation is a solid, well thought out, business plan. Without a solid foundation, the whole empire could crumble.

You've gotta figure out how long you're going to be able to work at a loss.
If you design the site for $10,000
Hosting costs $150/month ($1,800/year)
Advertising/marketing is $5,000

You're looking at almost $17,000 in first year costs. Can you afford that?

How fast could you get about 200 consumers paying $9 a month? You'll need at least 1890 $9 payments to break even. If you get about 200 consumers in the first month, and they keep paying for the entire year, you're OK, but there's going to be migration and you have to prepare for that.


All of these things should have been part of the plan or at least have gone through your mind as you write up the business plan.

Ok, thank you for the responding, and i have just had a brainwave that maybe the answer...

I think spending £10,000 on a web design is too excessive, especially with several thousand dvd purchases and advertising on top, the cost would go through the roof! Therefore how about a dvd hire business where the consumer pays for every film downloaded and watches via the computer. That way you will not have any dvds to send out and could even be cheaper than Netflix! You could also gradually build the collection of films available rather than diving in at the deep end.

Example: Recently i saw a trailer for the new Pirates of the Carribbean - The Dead Mans Chest which is in cinemas from July. Now imagine when its released, what would you prefer? Renting from Netflix where you have to wait until the dvd arrives, or download it from National Film Hire and be watching within minutes...
Currently theres a song called crazy that has made it to no.1 in the British charts on the download sales alone and is the first time its happened. Is this a sign of the future?

However how big can a film screen be on a computer?

This is the same premise of the company I'm building. Downloadable films for pay.

Maybe we could hook up and have it be an International Film Hire? :smile:

Yes absolutely! We could exchange films aswell and build up the film menu even quicker.

Do you mind me asking how much your web design is costing?