Verde Media Group Inc. is a publicly traded company listed on the OTC Markets trading under the symbol VMGI. It operates a managed media financing company with production, distribution, and development functions for film and television. The company also incorporates an Agency division managing multi-media, public relations and marketing functions for corporate clientele.
Market opportunity and background
Significant domestic and international interest in film, television and multi-media and the commercial opportunity it provides will leverage VMGI's ability to reach maximum potential for its shareholders.
Global box office for all films released in each country around the world reached $34.7 billion in 2012, up 6% over 2011's total, due to an increase in international box office ($23.9 billion) and U.S./Canada box office ($10.8 billion). All international regions with the exception of Europe experienced growth in 2012. Chinese box office ($2.7 billion) grew by 36% in 2012 to become the largest international market, surpassing Japan. International box office is up 32% over five years ago, driven by growth in various international markets, including China, Russia and Brazil. Over two-thirds of the world's nearly 130,000 cinema screens are now digital.
More than two-thirds of the U.S./Canada population (68%) – or 225 million people – went to the movies at least once in 2012. In 2012, frequent moviegoers represented 13% of the population and 57% of all movie tickets, an increase of 7 percentage points in ticket share from the previous year. This suggests that the increase in ticket sales in 2012 was among moviegoers who increased their attendance from less than once a month, to once a month or more. This is expected to grow in the first two quarters of 2013.
2012 U.S./Canada box office was $10.8 billion, up 6% compared to $10.2 billion in 2011, and up 12% from five years ago. 3D box office was similar to 2011 ($1.8 billion), despite fewer 3D film releases.
Verde Media Groups business model differs from many other companies in the independent television production sector as it retains control and ownership of all of the rights in its programming beyond the first-run rights granted to the broadcaster. Traditionally, most independent television production companies have been forced to give up these rights to the broadcaster in order to secure distribution. The company enters into deals that allow significant control and ownership of all the rights to each project developed, produced, or distributed from the Companies library. These rights are valuable, as in addition to the revenues generated from the primary rights licensed to the broadcaster, the company is able to generate substantial additional revenue streams through exploitation of the ancillary and secondary rights in its programming brands.
The Company intends to build a library of Intellectual Property Rights ("IPR") delivered in various formats, including digital download, DVD, broadcast television and mobile technology that will be fully exploited. The revenue from these libraries will offer a more predictable and timely revenue stream. The Company is well placed to take advantage of these opportunities and to capitalize on the growth that the industry is experiencing.
The Company utilizes proven cost effective business models to develop, produce and distribute and market properties that are budgeted between $3mm and $15mm.
The Company captures opportunities in the entire value chain of film and television creation by; (i) sourcing and evaluating prospective projects through a research-led investment process; and (ii) managing and structuring the production and distribution of such projects. In sourcing prospective projects the Company thoroughly evaluates the concepts, scripts, directors and cast in respect too current market data, tastes and trends. The Company then assesses the feasibility of the project in relation to budget, scope, timescales and the risks and rewards of each opportunity. Once the Board has approved a project, the Company seeks to retain full ownership of all rights relating to each project, although in certain situations the Company may invest in a project where it may not acquire all rights. Distribution and Marketing of the projects will be handled by using a low cost method of outsourcing and partnering for larger more capital intensive campaigns with reputable companies that Verde Media Group has co-production relationships with. Smaller campaigns will be handled in-house directly by the company through the Agency division.