The film industry is in a deep crisis according to the distribution gurus. “Picturehouse and Warner Independent have been shut down. New Line's staff was cut by 90 percent. Disney decreased the number of movies released per year from 47 to 12. Warner Brothers went from 35 to 20 films in less than 10 years,” – says Mark Gill, the CEO of The Film Department and former president of Miramax Films. [1]
The average cost of a major studio production is $70.8million, and the average marketing budget in North America alone is $35.9 million. In other words, there's an average of more than $100 million at risk every time they get up to bat. And if they're going to lose $75 million or more, they know it by 2 p.m. Los Angeles time on opening day. [1]
Hollywood has spent a lot of time and money on making bad films under the theory that quality didn't matter. But it's not working like it used to, because fooling the audience is getting harder in the age of blackberries and cell phone texting. Good buzz spreads quickly, bad buzz even faster. [1]
The film markets like Cannes market and AFM are getting worse every year. American films are not selling overseas, because the filmmakers in other countries have learned to do their own quality content. This year at AFM, considering the financial crisis, the prices on American A-movies are cut by foreign distributors, and B-movies are not selling out.
What about independent film? There are 5000 films submitted to Sundance festival each year, generally with budgets under $10 million. Maybe 100 of them got a US theatrical release three years ago. And it used to be that 20 of those would make money. Now maybe five do. That's one-tenth of one percent. Put another way, if you decide to make a movie budgeted under $10 million on your own tomorrow, you have a 99.9% chance of failure. [1]
Mark Gill believes that film with budget under 10 million has no chance to succeed nowadays: "We're entering an era where the only films with any chance for success will be the $100 million-plus tentpoles, and reasonably priced films of some perceived quality". According to Mark Gill, a film’s budget should be between $15 and $50 million: “It has to do with being able to pay professionals to create quality emotional content that has a market. And it has to do with the prices that international distributors can afford to pay in the top 12 countries, which is what gives financiers enough comfort to commit capital.”
Peter Broderick (distribution strategist, former head of IFC Next Wave Films) explores the New World of Distribution in his article. [2] He believes that theatrical release is the last thing that independent filmmaker has to think about. According to this article, the idea of selling DVDs from your own website and getting 100% of revenue sound wonderful. But in reality who’s going to buy it? People don’t buy DVDs, when they can rent movies or even download it from Internet.
The independent film’s future is probably for online distribution. In that case we are talking about very small income. Now imagine how low the production cost should be! Meanwhile, the filmmakers, who think they are smarter than big boys, keep making micro to no-budget films, hoping to sell it online. But who’s going to watch it?
It used to be that a film with a nice performance, a cool look and a broken story could get through. Not any more. Clearly, only the better films will succeed in the theaters of the future. This is very good news for people who care about the quality of cinema, singularity of voice, and resonant themes. [3]
The filmmakers should adapt to new circumstances. The biggest change should be to make movies that we absolutely love. Not ones we like. Not ones we need to do as a favor. Not the ones we do because they seem like a good "piece of business." Not ones we do because we think that "the kids" will like them. Not the knock-offs of the ones that worked at the box office last year. [3]
References:
1. FIRST PERSON | Film Department's Mark Gill: "Yes, The Sky Really Is Falling."
by Mark Gill (June 22, 2008)
http://www.indiewire.com/biz/2008/06/irst_person_fil.html
2 WELCOME TO THE NEW WORLD OF DISTRIBUTION by Peter Broderick
http://www.peterbroderick.com/writing/writing/maximizingdistribution.html
(First appeared in indieWIRE, September 16 & 17, 2008)
3. FIRST PERSON | Film Department's Mark Gill: "Yes, The Sky Really Is Falling."
by Mark Gill (June 22, 2008)
http://www.indiewire.com/biz/2008/06/irst_person_fil.html
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