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Monday, September 1, 2014

Neither Rome nor VODwiz was built in a day...

Happy Labor Day to our HHSE Friends & Shareholders. 

As many of you know – and as was announced at the annual Shareholder’s Meeting in February – the launch date for the consumer outreach campaign for VODWIZ was set for August 30th.  That was this past Saturday.  But we didn’t make this date.  Fortunately, it was a self-imposed date and known only to HHSE shareholders;  also fortunately, we were able to reschedule our consumer ads and internet campaigns without financial penalty.
But before the “naysayers” do a delightful chicken dance, let’s discuss why VODwiz did not go live this past weekend, so that the market has a better understand the scope of this venture.  We will attempt to be brief as the technical details are voluminous.  Yes, believe it or not, this is the "brief" explanation.  What we are building is a HUGE revenue portal and a major consumer brand, so even a brief summary is rather lengthy.
WHAT IS VODWIZ?  Unlike “Netflix” or “Hulu” which are “subscription-based” streaming services, VODwiz is structured (primarily) as a pay-per-transaction service (which is closer to the I-Tunes and Amazon.com model).  The subscription services – while wildly popular with consumers – are still very content challenged.  For example, two links are attached to the bottom of this blog which highlight the limitations of SVOD services in providing a wide range of content.  For movie consumers that have already seen the top blockbusters at the theatres, Netflix is a poor entertainment choice for anything other than binge viewing of TV Series marathons.  VODwiz believes that there are THOUSANDS of movies that are NOT AVAILABLE on Netflix and Hulu, that consumers would want to see if they were easily found and affordably accessed.  Many indie and alternative titles are available on I-Tunes and Amazon, but thousands are not; and those that are currently available tend to be priced prohibitively for “impulse” viewing.
The goal of VODwiz is to be a primary destination on the internet (or via IPTV viewing) for consumers “looking for something else.”  Accordingly, our program supplier partners are not the major studios (at this time), but are the major independent distributors, covering a wide range of programming from Asian and anime to urban and horror.  Please note that within this first year of launch, VODwiz does expect to add programming from a few major studio libraries as well. 
Typical pricing models from VODwiz  range from $.99 per movie to $3.99 for premium content (major studio titles may be priced higher); additionally, a large number of VODwiz titles will also be available under a “monthly subscription” service, which the company plans to introduce in January.
Over the past few months, HHSE staffers have been working on a wide range of projects in support of the VODwiz launch, including:
·         Solicitation of Studio Partners (we now have twelve major indie partner studios!);

·         Clearance of titles for streaming (avoidance of exclusivity conflicts and E&O representations);

·         Assembly of properly formatted masters;

·         Assembly or creation of properly formatted “metadata” for database access;

·         Creation of consumer publicity, advertising and social media ads and strategies;

Despite a Herculean effort by management and staff – we were not at a point last week to reliably initiate a successful consumer launch on August 30.  HHSE Management takes responsibility for missing our self-imposed deadline.  Unfortunately, there’s no easy reference book on “how to launch a $20-million dollar internet streaming channel.  If this were an easy task to do, others would likely be trying.  Every item on our above check list (except the first step of “soliciting studio partners”) has proven to be exponentially more difficult and time consuming than would be suggested by the mere mathematics of taking one-movie to market and multiplying that amount of time by the 6,000+ titles currently on offer to VODwiz.  Clearly, the assembly of MASTERS and the clearance for non-exclusivity conflicts and rights approvals of third-party suppliers has proven to be our greatest time challenge.
HHSE and VODwiz are now properly staffed and fully engaged in the on-boarding process.  We want to launch to consumers this month (September), but will only do so if a suitable number of higher-profile titles are fully cleared and on-boarded.  With all due respect to “Future Shock– (for instance, with no disrespect intended for the program’s creators, HHSE CEO Eric Parkinson and “Dawn of the Planet of the Apes” director  Matt Reeves) – we don’t think that B-titles of that level are likely to drive a ton of repeat site visits to VODwiz.  We prefer to launch the site with a showcase of 20 recent theatrical releases as the home page titles, with the thousands of indie and specialty titles being the filler-catalog.  It’s the proverbial “one-chance to make a first impression” that we are preserving.
When the concept of VODwiz was first presented to Shareholders, the company forecasted that the site could have 2,500 titles.  We now realize that the site could easily (eventually) have more than 10,000 titles for streaming (we have one supplier studio partner with 2,700 titles themselves!).  Will being the world’s largest repository of films available on-line for streaming be a good thing for HHSE?  Management thinks it’s profound, and will be the tail that wags the dog in revenues, stature and consumer awareness. 
So as we go into a new week for Hannover House and VODwiz, let’s all take a deep breath, and get back to the task.  No one can tell you “the date” that NETFLIX or HULU began streaming content, because when they started their services is irrelevant.  But assuredly, if there’s a streaming glitch or delivery issue, their customers go NUTS and demand technical perfection.  We did not want to launch VODwiz this past Saturday because we were not ready for a variety of reasons.  Launching the service properly is more important to us than meeting a self-imposed, unannounced deadline. 

Some shareholders have communicated to HHSE management that the delay in launching VODwiz may be a terrific opportunity for longs.  A small group of highly vocal “sky-is-falling” naysayers have pledged to attempt to drive-down the HHSE share price because company management stood-up to their extortionist threats.  Our investigations have shown them to have limited financial resources, but unlimited egos and claims.  To falsely “paint” the HHSE stock price down below its value, they have oftentimes sold shares to themselves in tiny amounts (12-to-501 shares) well below prevailing bids.  These same chat-board posters have been promising for years that HHSE is never going to make it to the next quarter, and “ooooh, if only you knew what we knew” baloney in order to try to encourage legitimate longs to bail on the stock.  It would not take much buying pressure to make the little puppies squeal and run, so we’re told.  In any event, the naysayers will likely delight in HHSE Management making the decision to delay the launch until VODwiz is fully ready, instead of launching to meet a self-imposed target date.  So you can expect some of the stock chat boards to light-up with absurdities from the court-jesters.  For the convenience of legitimate shareholders, a list of known posters of baloney and poo-poo was prepared by BashTrack and is linked below.  One sage trader told HHSE management that  good rule of thumb to maximize profits is to do the exact opposite of what these known manipulators are promoting on the boards.

THIS COMING WEEK, we should finally be cleared (through our insurance underwriter) to announce key supplier studio partners for VODwiz.  As each supplier is announced, we will include 20 to 30 of their more popular titles in the news releases;  however, the full-scale of the VODwiz title listings will be deferred until the site is fully up-loaded for consumer access.

LASTLY – Fred Shefte and Eric Parkinson want to THANK our HHSE / VODwiz staff for the tremendous effort that has been expended over the past few weeks (and the many hours of overtime waived!), to get VODwiz elements together for the on-boarding process.  Kudos to:  Daniel Ackerman, Regina Hurst, Mitsi McGee, James Mc Lean, Caitlin McKenzie, Katherine Mills and Tom Sims.  ALL OF YOU ARE TOP SHELF!

WILL VODwiz BE A $20-MM DIVISION?  The math says that this is a very obtainable number… now it will be up to consumer response to determine. 

(Netflix – stories re:  limited product availabilities):

(Naysayer’s Central, posters to ignore):