Cinedigm Corp. (NASDAQ:CIDM) Q2 2023 Earnings Call Transcript

So you are going to look for additional successes in horror. We think we have that same capability in anime and Asian content, and we have that same capability in family films. And we don’t think that this is going to be a one-off event, but we are going to have more successes like this in the future across the spectrum of our channels.

Dan Kurnos: Got it. That’s very comprehensive. Thanks, Chris. I appreciate that. And then maybe also for you and/or for Erick, I guess, you gave some color just around the initial rollout of Cineverse umbrella channel. I guess I am just trying to get a sense in this market that’s obviously increasingly shifting towards AVOD and FAST, which shouldn’t be a surprise to anybody. How you are thinking about — do you just want to get it out as quickly as you can, how are you thinking about the content backstop? How are you thinking about monetization in sort of a choppy CPM environment? Just help us understand sort of kind of the plans on Cineverse going forward and how you think about maximizing the opportunity you have to kind of roll out this umbrella channel?

Chris McGurk: Great. I will let Erick answer that. But first, let me just put a point here. When you talk about FAST and ad-supported, don’t discount the fact that we just crossed 1 million paid subscribers this quarter. because we have a different subscriber business than what people think of when they think of streaming with Netflix and Disney+ spending millions and millions of dollars to acquire subs. That business, for us, which we got into early on, we are not — we are spending virtually nothing to acquire those subs. So it’s an extremely profitable business for us, because we are so successful in these enthusiast verticals that we have out there, the subscriber growth is really happening organically. And that’s a meaningful number of subscribers and it’s still a meaningful business for us that continues to grow. So I just wanted to point that out. But let me turn it over to Erick to answer your question about Cineverse.

Erick Opeka: Yeah. So our — the focus really is on partnerships at this stage. So as we announced last quarter, I think, beginning of this quarter that we are reporting here, Vidgo partnership, our expectation is to announce more partnerships where Cineverse comes bundled with OEM devices, other streaming services and platforms and so on. We think that’s a cost-effective way to grow the base. The service has a great array of content not available on other services. So we think it sells itself once you get it into the hands of consumers. So that’s going to be our primary focus. Number one is leveraging those partnerships. Number two is we have a very substantial application base out in the market today. We have tens of millions of apps already out there.

We can leverage that app base to drive — we are — as we update the portfolio of streaming services, having the ability for people to sample Cineverse and if they like it, download the app from within other apps in the Cinedigm family, we are going to be leveraging that. And then, lastly, we have 80 million people captive across our footprint every month heavily marketing to that audience is going to be a cost-effective way to scale and grow the sub base. And beyond that we — that doesn’t mean we are not going to make traditional investments in customer acquisition. The further partnership with OEMs is not off the table, further paid marketing placement and other things to drive business in a smart way, secondary to leveraging the assets we have will be the model.