Rethinking Film Distribution
Distribution consultant Peter Broderick says filmmakers should consider new strategies for distributing their films to avoid future disappointment.
This is the last in a series of articles that came out of the Vancouver International Film Festival Trade Forum that ended last month. Peter Broderick President of Paradigm Consulting was speaking at the closing day of the festival - the New Filmmaker's Day - about alternative distribution channels and we spoke subsequently by phone.
Peter Broderick has long been a champion of the independent filmmaker. I first heard him giving a presentation on making micro-budget films at the Edinburgh International Film Festival six years ago.
At the time, the dot com boom was at its most heated and speculation was rife about how the web would revolutionise the movie world. It was impossible to get tickets to see the festival screening of the hyped-as-hell Blair Witch Project (iofilm's reviewer, Johnny Bravo, had to hide out in the cinema to see it). iofilm was streaming video interviews from the EIFF including iofilm chief film critic The Wolf's interview with Terry Gilliam, and other fest guests. The clips, made for people with 56k modems, were in tiny windows and jerky, but we were cutting edge (at least, we thought so).
In his presentation, Broderick wowed the audience with some film clips that had originally been shot on videotape and "blown up" to film. Sure, some of the footage had a familiar murky, DV look, but other footage that had been more carefully shot was stunningly good. While there was industry resistance to his ideas, his message that you can make an ultra-low-budget film on DV was exactly the kind of thing that budding filmmakers wanted to hear, and no doubt, inspired many to go off and do just that.
Broderick admits that many people "thought I was mad then." Digital transfers were still at the pioneer stage, even if Danish, experimental Dogma was making waves with lean, no-frills features like Idiots (1998) and Festen (1998). Fast-forward to March of this year. A decade since Lars von Trier and Thomas Vinterberg penned their Dogma manifesto, the Vow of Chastity, and you can see how far we've come: DV filmmaking is mainstream, digital projection in theatres is common, and now that broadband is ubiquitous, streaming video is finally beginning to take off.
Peter Broderick also now has a new message, that it's time filmmakers took more control of the distribution of their films.
"The old distribution model is broken"
Broderick, still apprehensive after his ideas came under attack at the Montreal film festival, prefaced his new presentation at VIFF Trade Forum with a disclaimer saying that his criticisms on the distribution system don't apply to all films.
Also, countries that have government support for indigenous film, like the U.K. or Canada, have evolved different distribution models than U.S. independents.
However, as he got into his stride it was evident that his central point was a universal one - namely that filmmakers should try to retain as many rights to their own work as they can.
Broderick, who says he has consulted with around 100 filmmakers over the last three years, painted the "traditional distribution model" in dark terms. Filmmakers are either finding themselves blocked out from conventional distribution channels by a small number of gatekeepers or stuck in lousy distribution deals where they see little to no returns.
Broderick pointed out the anomaly in the traditional distribution model where the independent filmmaker takes all the risk, does all the work and has "100% control" while making the film, then hands the film over to a distributor, after which the filmmaker sees 10% of the revenue from the film "if you are lucky."
Broderick said that not only does the filmmaker lose control over the film, but, perhaps even more importantly, he or she can do nothing if, as often happens, the distributor loses faith in the film. The filmmaker, having handed over the rights to his or her work, can only watch helplessly as it collects dust in the distributor's film library.
"However bad you think independent distribution is, it's worse. It's not a crisis. The conventional model is broken," said Broderick. "If you asked how many filmmakers are happy with their distribution deals, 2% would be a big number."
Consider the distribution strategy
Opening a film theatrically is an expensive business, with films often losing money at the box office. The theatrical release is seen as an essential part of the distribution strategy because it generates awareness for a film, which hopefully translates into DVD sales further down the road.
Deals vary, but in a "standard distribution deal" once theatre-owners have taken their slice, say, 50% of box office gross, the distributor has taken his fee, typically 35% of gross, and the distributor has recouped the cost of prints and advertising (P&A), the filmmaker can easily be in debt. It can take some time for ancillary revenues, in particular, from the big revenue-maker DVD sales, to get the filmmaker into the black.
Broderick says that some filmmakers are responding to this situation by getting more proactive in their distribution strategy. Rather than aim for a conventional distribution deal whatever the terms, producers are focussing on distribution strategies that maximise their opportunities to earn revenue from their film - and that usually means hanging on to as many rights as possible, and getting into a position where they can negotiate from a more favourable position.
Service Deal: a better deal
Wealthier producers are showing that service deals are an effective distribution strategy. In a service deal, the filmmaker fronts the bill for prints and advertising costs (P&A) and hires a company to provide distribution services, from promoting the film to collecting revenues from exhibitors. The filmmaker is in effect renting the distribution system for theatrical releases, but pays less for the distribution fee (around 10%-25% of gross, rather than the classic 35% of gross). The producer is risking his or her own money, but retains control over the film and continues to have final say in the promotion and costs. Broderick rattled off a list of films that had been service deals, some which may ring a bell: Fahrenheit 9/11, Monster, and My Big Fat Greek Wedding.
The latter, a $5 million, ethnic comedy with no big-name stars, grossed over $241 million at the U.S. box office. The advertising budget was around $1million and the distributors, IFC Films, were paid a flat fee of $300,000. Even the reported 7-figure sum they negotiated as bonus payments with the film's producers after it became a tearaway success would be dwarfed if they had entered into a conventional distribution deal.
Broderick says that where the cost of a service deal ($50,000 upwards) is prohibitive, filmmakers are using theatre bookers. "A fair amount...aren't so much service deals as people have hired a theatre booker who has relationships with theatre owners to help them put the movies in theatres," he says.
Booking cinemas yourself
Another option is four-walling, where the filmmakers take on the risk of a film doing well at the box office by renting a theatre and showing their film. If the producer is going the theatrical self-distribution route, Broderick suggests looking for a theatre that can screen a film for critics, has a mailing list or some way of reaching their audience, and a theatre with "some kind of prestige for getting into that theatre." Whether the producer is renting out cinemas or brokering revenue-share deals with cinema owners, self-distribution is a slog that few filmmakers relish, but it's not impossible to make a go of it.
Broderick cites What the Bleep Do We Know as a rare success story. "The Bleep" as it became affectionately known, created great grass roots buzz in a small town in Washington, played the Baghdad Theater in Portland for a record 19 weeks, before the producers made a deal with Samuel Goldwyn and Roadside Attractions, the distribution team behind Super Size Me.
"Even if you have no theatrical or even if you had a failed theatrical that doesn't mean that the film wouldn't work on television and that you couldn't have a DVD strategy that was effective. I think of theatrical as something that is nice to have, but it's not essential. In the old model, the traditional model, theatrical is essential..." says Broderick.
"I don't recommend that filmmakers go it alone and try and reinvent the wheel. But I also don't recommend that they just blindly go into making overall deals assuming that all their problems will be solved by this one company, whatever it may be," says Broderick.
"The filmmakers that are doing the best are the ones that have chosen some kind of hybrid strategy... It could be a television deal, either domestic or foreign, a retail deal, or working with an established educational distributor."
Internet distribution and marketing
New technology continues to offer unprecedented distribution opportunities. Much-improved DVD projection, giant plasma screens, and surround-sound home entertainment systems are allowing filmmakers to bring the cinematic experience into other public and private places. You don't need a cinema to show your film to a crowd. You just need a large, quiet space, with protection from the elements, and an electricity supply.
Blair Witch may have been a one-off, but filmmakers are using the internet both as an effective grass roots marketing tool and for making direct distribution a possibility. Robert Greenwald's (Outfoxed, Uncovered) latest project, Walmart: The High Cost of Low Price, which I wrote about last week and which is moving into gear this week, is a high profile example of how documentary filmmakers are tooling up online. Greenwald's film is premiering at thousands of community screenings and house parties, all screened off DVD. The expectation is that he will capitalise on DVD sales of the film as word-of-mouth spreads among his core audience and people buy the film as gifts for friends or for educational uses.
Like theatrical releases, house parties are about creating word-of-mouth, and filmmakers don't expect to make a killing at the "box office".
Greenwald, for example, is just charging for the price of the DVD that will be used to project the film (organisers of screenings can charge as little or as much as they like).
"The first priority is establishing awareness and hoping that that will result in good things subsequently," says Broderick.
"It couldn't happen here"
Broderick also cautions against thinking that direct distribution using the internet is a uniquely U.S. phenomenon.
"It's a mistake - and this is one of the things I ran into in Australia - people would say that, 'The examples you give are fine for the U.S., but it's a big market, and we're a small country.' And my response was in terms of internet sales you've got to think bigger. You've got to obviously work your home market as effectively as you can, but then you have to figure out ways to reach people in other countries."
Broderick doesn't suggest that filmmakers try and do everything themselves literally. He suggests building a team for the online presence, and contracting a fulfillment house "to fulfill to the world."
With bulk printing of DVDs (including postage and packaging) now costing less than a pound, the filmmaker who has retained rights to their film can benefit from a nice mark-up per unit sale. There are a few technical issues to bear in mind, like what region to print the DVDs in (Broderick suggests a universal region 0) and whether you should go NTSC or PAL, but these are not insurmountable.
"You don't have to sell a lot of DVDs to break even on lower budget movies. If filmmakers can figure out a way to sell ten or fifteen thousand DVDs over time, over the world, that can be enough to get them into the black. Once they've got those names and email addresses they can take that to other projects," says Broderick.
DVDs wont be around for ever. Digital downloads are becoming more common. Broderick points out that the first nine minutes of the feature film Serenity went online for free for a limited period. The film was full-screen and played within a minute of clicking the play button. "It's the best quality streamed video I've seen," he says.
Broderick sees some films even being cast on mobile media, like the video iPod in the "not-too-distant-future." It's difficult to envisage people watching films on their tiny handheld screens, but Broderick is adamant: "People are saying it's just television. They're so wrong. This is just the beginning..."