Media Wonk

Can the Web save indie filmmaking? - June 5, 2008

Over the years, indie film production and distribution in Hollywood has followed a fairly well-worn cycle: Someone has a break-out hit with a quirky, inexpensive film and gets a studio deal; others rush in to make their own version of the same quirky, inexpensive film and don't get studio deals but their movies get picked up for distribution; quirky, inexpensive films become the flavor of the month and land on the cover of Newsweek and the Arts & Leisure section of the Sunday New York Times; a land-rush ensues; the major studios swoop in and buy up newly spawned indie studios and distributors; some studios start their own "indie" labels; the studios  end up overspending for everything, raising expectations and ultimately ruining it for everyone; indie filmmaking contracts; cycle starts anew.

Right now, we're on the leeward side of the cycle. This week, Paramount Vantage ("No Country For Old Men," "There Will be Blood") got merged back into Paramount Pictures. Last month, Warner Independent got the same treatment, as did its sister-"indie" label Picturehouse. Time Warner also shut down one-time indie New Line Cinema and merged the remnants into Warner Bros. One-time indie icon ThinkFilm got stuck with too many films it overpaid for and ending up selling off its catalog to a Canadian investor. The Sundance Channel got sold to Discovery Networks. Rainbow Media.

This time, however, the cycle may get permanently off course. "I don't think it's a blip," IndiePix president Bob Alexander says of the ongoing collapse of the indie film distribution system. "I think the economic changes in the theatrical distribution system are permanent and it's going to be very hard to get them to work for independent films at this point."

The problem isn't just the difficulty of getting indie films onto multiplex screens, Alexander said. It's everything that comes after that.

"Take a film like 'La Vie En Rose,'" he said. "That was an $11 million picture. A good film, it won a Best Actress Oscar. The theory used to be you did what you did in theaters then you turned it over to the DVD side to make the real money. But when your entire two month [theatrical] run is $11 million, you can't build a successful DVD release on that anymore. 

The DVD market itself is also under pressure, as retailers cut back shelf space and videogames siphon off disposable dollars.

IndiePix was set up in 2004 to try to improve the economics of distributing indie films by leveraging digital technology. Unlike other new media companies chasing that same Holy Grail, however, IndiePix thinks the Web is more useful right now as a marketing and audience-development tool than as a distribution platform.

"Our business is totally DVD-centric," Alexander told Media Wonk. "Yes, you can download movies from iTunes, or you can stream your Netflix movies to your Roku box. But at the present time, the easiest way to get a high-quality presentation of a movie on your TV is to take it out of the sleeve and put it in your DVD player."

DVD sales are also more remunerative for all concerned.

"Our best titles at this point can sell 5,000, up to maybe 10,000 copies [on DVD] but the filmmaker can make $100,000 off that because half of what we get goes back to the filmmaker," because IndiePix splits the revenue with the producer. "Our focus is not on streaming, although we'll do some of that, or on rentals. It's on the sale of the DVD because half that money goes back to the filmmaker. We see that as the best way to build an economic base that allows independent filmmakers to make more films and allows consumers to enjoy a high-quality presentation of the movies."

IndiePix has compiled a list of about 100,000 names and email address from an opt-in membership sign up on its Web page. Members get a monthly newsletter on indie films and filmmakers, plus weekly email blasts highlighting new films and weekly download offerings. The company is adding "a few thousand" names a month, net of churn, according to Alexander.

"It will take some time, but when we get up a million names, not everybody is going to buy every film, but if 3 or 4 percent buy any given film there's your 30,000 or 40,000 units," he said. "And you can do that with virtually no advertising budget, no retailer taking a percentage of the consumer dollar, and no manufacturing costs until you sell something because we manufacture on demand as orders come in."

Not the sexiest use of new technology, perhaps, but potentially effective.

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