By Orly Ravid and Sheri Candler

In the past 2 posts, we have covered knowing the market BEFORE making your film and how to incorporate the festival circuit into your marketing and distribution efforts. This post will cover terms you need to know; whether a foreign distribution agreement is in your film’s future and what to do if it isn’t; the patterns, or windows, that need to be considered in your release. Just to be clear, we are targeting these posts mainly to filmmakers who seek to self finance and actively control their distribution. If that is not your plan, the usefulness of these posts may vary.

Distributors; platforms; aggregators; self hosting sites; applications

If you are new to the distribution game, here are some terms you now need to be familiar with.

Distributors (ie.  A24, Oscilloscope, Fox Searchlight, Sony Classics, The Weinstein Company, Roadside Attractions) take exclusive rights to your film for a negotiated period of time and coordinate its release.  These companies often acquire independent films out of the most prestigious film festivals and pay decent advances for ALL RIGHTS, sometimes even for ALL TERRITORIES. A signed and binding contract takes all responsibility for the film away from its creator and places it with the distributor to decide how to release it into the public. Distribution through these entities entails theatrical, digital, DVD, educational, leisure (airline/hotel/cruiseship).

Platforms (ie. iTunes, Amazon Prime, Google Play, Hulu, Netflix, cable VOD) are digital destinations where customers watch or buy films. Viewing happens on a variety of devices and some allow for worldwide distribution. Mainly platforms do not deal directly with creators, but insist on signing deals with representative companies such as distributors or aggregators.

Aggregators (ie. Premiere Digital, Inception Media Group, BitMAX, Kinonation) are conduits between filmmakers/distributors and platforms. Aggregators have direct relationships with digital platforms and often do not take an ownership stake. Aggregators usually focus more on converting files for platforms, supplying metadata, images, trailers to platforms and collecting revenue from platforms to disperse to the rights holder. Sometimes distributors (Cinedigm, FilmBuff) also have direct relationships with digital platforms, helping reduce the number of intermediaries being paid out of the film’s revenue.

Self hosting sites (ie. VHX, Distrify, Vimeo on Demand) are all services that allow filmmakers to upload their films and host them on whatever website they choose. Vimeo on Demand also hosts the video player on its own central website and has just integrated with Apple TV to allow for viewing on in-home TV screens.

Applications for many digital platforms can be found on mobile devices (smartphones and tablets),Over the Top (OTT) internet-enabled devices like Roku, Chromecast, Apple TV, Playstation and Xbox and on smart TVs. Viewers must add the applications to their devices and then either subscribe or pay per view to the platforms in order to see the film.

What about international?

In the latest edition of our Selling Your Film book series, Amsterdam based consultant Wendy Bernfeld goes into great depth about the digital distribution market in Europe. Many low-budget, independent American films are not good candidates for international sales because various international distributors tend to be attracted to celebrity actors or action, thriller and horror genre fare that translate easily into other languages.

Rather than give all of your film’s rights to a foreign sales agent for years (often 7-10 years duration) just to see what the agent can accomplish, think seriously about selling to global audiences from your own website and from sites such as Vimeo, VHX, Google Play and iTunes. The volume of potential viewers or sales it takes to attract a foreign distributor to your film is often very high. But just because they aren’t interested doesn’t mean there is NO audience interest. It simply means audience interest isn’t  high enough to warrant a distribution deal. However, if you take a look at your own analytics via social media sites and website traffic, you may find that audience interest in foreign territories is certainly high enough to warrant self distributing in those territories. Look at this stats page on the VHX site. There are plenty of foreign audiences willing to buy directly from a film’s website. Why not service that demand yourself and keep most of the money? Plus keep the contact data on the buyers, such as email address?

Often, sales agents who cannot make foreign deals will use aggregators to access digital platforms and cut themselves into the revenue. You can save this commission fee by going through an aggregator yourself. In agreements we make with distributors for our Film Collaborative members, we negotiate for the filmmaker to have the ability to sell worldwide to audiences directly from their website. If you are negotiating agreements directly with distributors, the right to sell directly via your own website can be extremely beneficial to separate and carve out because sales via your website will generate revenue immediately. However, this tactic is now being scrutinized by distributors who are allowing direct to audience sales by filmmakers, but asking in their agreement for a percentage of the revenue generated. It is up to the filmmaker to decide if this is an acceptable term.

If you do happen to sell your film in certain international territories, make sure not to distribute on your site in a way that will conflict with any worldwide release dates and any other distribution holdbacks or windowing that may be required per your distribution contracts. An example: You have signed a broadcast agreement that calls for a digital release holdback of 90 days-6 months-1 year or whatever. You cannot go ahead and start selling via digital in that territory until that holdback is lifted. Instead, use a hosting service that will allow you to geoblock sales in that territory.

Photo credit David Goehring

Know your windows.

If you do decide to release on your own, it’s important to know how release phases or “windows” work within the industry and why windowing was even created.

The release window is an artificial scarcity construct wherein the maximum amount of money is squeezed from each phase of distribution. Each window is opened at different times to keep the revenue streams from competing with each other. The reason it is artificial is the film continues to be the same and could be released to the audience all at one time, but is purposely curbed from that in order to maximize revenue and viewership. The Hollywood legacy window sequence consists of movie theaters (theatrical window), then, after approximately  3-4 months, DVD release (video window). After an additional 3 months or so, a release to Pay TV (subscription cable and cable pay per view) and VOD services (download to own, paid streaming, subscription VOD) and approximately two years after its theatrical release date, it is made available for free-to-air TV.

Now, there is a lot of experimentation with release windows. Each release window is getting shorter and sometimes they are opened out of the traditional sequence. Magnolia Pictures has pioneered experimentation with Ultra VOD release, the practice of releasing a film digitally BEFORE its theatrical window and generally charging a premium price; and with Day and Date, the practice of releasing a film digitally and theatrically at the same time. Many other distributors have followed suit. Radius-TWC just shortened the theatrical only window for Snowpiercer by making it available on digital VOD within only 2 weeks of its US theatrical release. During its first weekend in US multiplatform release, Snowpiercer earned an estimated $1.1 million from VOD, nearly twice as much as the $635,000 it earned in theaters.

So, while there are certainly bends in the rules, you will need to pay attention to which release window you open for your film on what date. For example, it might be enticing to try to negotiate a flat licensing fee from Netflix (Subscription VOD or SVOD window) at the start of release. However, from a filmmaker’s (and also distributor’s) perspective, if the movie has not yet played on any other digital platforms, it would be preferable to wait until after the Transactional VOD (TVOD) window in order to generate more revenue as a percentage of every TVOD purchase, before going live on Netflix. If the transactional release and subscription release happen at the same time, it cannibalizes transactional revenue.

Also, sites like Netflix will likely use numbers from a film’s transactional window purchases to inform their decision on whether to make an offer on a film and how big that offer should be. Subscription sites such as Netflix also pay attention to general buzz, theatrical gross, and a film’s popularity on the film’s website. There is value in gathering web traffic analytics, email database analytics and website sales data in order to demonstrate you have a sizable audience behind your film. This is useful information when talking to any platform where you need their permission to access it. Caution: Netflix is not as interested in licensing independent film content as it once was. If your film is not a strong performer theatrically, or via other transactional VOD sites; does not have a big festival pedigree; or does not have notable actor names in it, it may not achieve a significant Netflix licensing fee or they may refuse to license it for the platform. Netflix is no longer building its brand for subscribers and it has significant data that guides what content it licenses and what it produces.

Also be aware that some TV licensing will call for holding back Subscription VOD (SVOD) releases for a period of time. If your film is strong enough to achieve a broadcast license deal, you will need to wait before making a subscription release deal. On the other hand, holding out too long for a broadcast distribution offer might cause the publicity and interest you’ve generated for your film to dissipate.

If your film is truly a candidate for theatrical release, most cinemas will not screen a film that is already available on TVOD or SVOD services. In fact, most of the chain cinemas will not screen a film that is available in any other form prior to or at the same time as theatrical release.

The way you choose to release your film is a judgment call in order to reach your particular goal. All decisions have consequences and you will have to live with the decisions you make in releasing your film. Like all decisions, you base them on what you know at the time with no guarantee as to how they will turn out.

 

 

July 16th, 2014

Posted In: Digital Distribution, Distribution, Distribution Platforms, DIY, International Sales, Theatrical

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Written by Orly Ravid and Sheri Candler

Now that the line up for feature films screening in Park City has been announced and the Berlinale is starting to reveal its selections, let’s turn our attention to the potential publicity and sales opportunities that await these films.

For those with  lower budget, no-notable-names-involved films heading to Park City this January, we understand the excitement and hopefulness of the distribution offers you believe your film will attract, but we also want to implore you to be aware that not every film selected for a Park City screening will receive a significant distribution offer. There are a many other opportunities, perhaps BETTER opportunities, for your film to reach a global (not just domestic) audience, but if you aren’t prepared for both scenarios, the future of your film could be bleak.

For any other filmmaker whose film is NOT heading to Park City, this post will be vital.

Sundance Egyptian

Have you been a responsible filmmaker?

What does this mean? Time and again we at The Film Collaborative see filmmakers willingly, enthusiastically going into debt, either raising money from investors or credit cards or second mortgages (eek!) in order to bring their stories to life. But being a responsible filmmaker means before you started production, you clearly and realistically understood the market for your film.  When you expect your film to: get TV sales, international sales, a decent Netflix fee, a theatrical release, a cable VOD/digital release, do you understand the decision making process involved in the buying of films for release? Do you understand how many middlemen may stand in the money chain before you get your share of the money to pay back financing?  Was any research on this conducted BEFORE the production started? With the amount of information on sites like The Film Collaborative, MovieMaker, Filmmaker Magazine, IndieWire and hundreds of blogs online, there is no longer an excuse for not knowing the answers to most of these questions well before a production starts. This research is now your responsibility once you’ve taken investors’ money (even if the investor is yourself) and you want to pursue your distribution options. Always find out about middlemen before closing a deal, even for sales from a sales agent’s or distributor’s website, there may be middlemen involved that take  a hefty chunk that reduces yours.

Where does your film fit in the marketplace?

Top festivals like Sundance, Berlin, Cannes, Toronto give a film the start of a pedigree, but if your film doesn’t have that, significant distribution offers from outside companies will be limited. Don’t compare the prospects for your film to previous films on its content or tone alone. If your film doesn’t have prestige, or names, or similar publicity coverage or a verifiable fanbase, it won’t have the same footprint in the market.

Your distribution strategy may be informed by the size of your email database, the size of the social media following of the film and its cast/crew, web traffic numbers and visitor locations from your website analytics, and the active word of mouth and publicity mentions happening around it. These are the elements that should help gauge your expectations about your film’s impact as well as its profitability. Guess what the impact is if you don’t have these things or they are small? Yeah…

Understand the difference between a Digital Aggregator and a Distributor?

Distributors take exclusive ownership of your film for an agreed upon time. Aggregators  have direct relationships with digital platforms and often do not take an ownership stake. Sometimes distributors also have direct relationships with digital platforms, and so they themselves can also serve as an aggregator of sorts. However, sometimes it is necessary for a distributor to work with outside aggregators to access digital platforms.

Do  understand that the digital platform takes a first dollar percentage from the gross revenue (typically 30%), then aggregators get to recoup their fees and expenses from what is passed through them, but there are some that only take a flat fee upfront and pass the rest of the revenue back. Then distributors will recoup any of their expenses and their fee percentage, then comes sales agents with their expenses and fees. And finally, the filmmaker will get his or her share. Many filmmakers and film investors do not understand this and wonder why money doesn’t flow back into their pockets just a few months after initial release. You guys are in the back of the line so hopefully, if you signed a distribution agreement, you received a nice advance payment. Think how many cuts are coming out of that $5.99 consumer rental price? How many thousands will you have to sell to see some money coming in?

Windowing.

If you do decide to release on your own, knowing how release windows work within the industry is beneficial. Though the time to sequence through each release window is getting shorter, you still need to pay attention to which sales window you open when, especially in the digital space. Anyone who has ever had a Netflix account knows that, as a consumer, you would rather watch a film using the Netflix subscription you have already paid for rather than shell out more cash to buy or rent a stream of the latest movies. But from a filmmaker/distributor’s perspective, this initial Transactional VOD (TVOD) window maximizes profits because, unlike a flat licensing fee deal from Netflix, the film gets a percentage of every transactional VOD purchase. So if you release your film on Netflix or another subscription service (SVOD) right away without being paid a significant fee for exclusivity, you are essentially giving the milk away. And when that happens, you can expect to see transactional purchases (a.k.a. demand for the cow) decrease.

Furthermore, subscription sites like Netflix will likely use numbers from transactional purchases to inform, at least in part, their decision as to whether or not to make an offer on a film in the first place. In other words, showing sales data, showing you have a real audience behind your film, is a key ingredient to getting on any platform where you need to ask permission to be on it.  Netflix is not as interested in licensing independent film content as it once was. It is likely that if your film is not a strong performer theatrically, or via other transactional VOD sites, it may not garner a significant  Netflix  licensing fee or they may refuse to take it onto the platform.

Also be aware that some TV licensing will be contingent on holding back subscription releases for a period of time. If you think your film is a contender for a broadcast license, you may want to hold off on a subscription release until you’ve exhausted that avenue. Just don’t wait too long or the awareness you have raised for your film will die out.

Direct distribution from your website

Your website and social channels are global in their reach. Unless you are paid handsomely for all worldwide distribution rights to your film, your North American distributor should not run the channels where you connect with your audience; the audience you have spent months or years on your own to build and hope to continue to build. These channels can be used to sell access to your film far more profitably for you than going through several middlemen.

Many low budget American films are not good candidates for international sales because the audience worldwide isn’t going to be big enough to appeal to various international distributors. Rather than give your rights to a sales agent for years just to see what they can do, think seriously about selling to global audiences from your own website and from sites such as Vimeo, Youtube, and iTunes. In agreements we make with distributors for our members, we negotiate the ability to sell worldwide to audiences directly off of a website without geo-blocking unsold territories. If you are negotiating agreements with other distributors, the right to sell directly can be extremely beneficial to carve out.  If you do happen to sell your film in certain international territories, it is wise to also make sure you do not distribute on your site in a way that will conflict with any worldwide street dates  and any other distribution holdbacks or windowing that may be required per your distribution contract.

You can sell DVDs, merchandise, downloads and streaming off your own site with the added benefit of collecting contact email addresses for use throughout your filmmaking career. Above all,  don’t hold out for distribution opportunities that may not come when publicity and marketing is happening. So many times we are contacted by filmmakers who insist on spending a year or more on the festival circuit with no significant distribution offers in sight and they are wasting their revenue potential by holding back on their own distribution efforts. You can play festivals AND sell your films at the same time. Many regional fests no longer have a policy against films with digital distribution in place. When the publicity and awareness is happening, that’s the time to release.

Festival distribution is a thing

Did you know that festivals will pay screening fees to include your film in their program? It’s true! But there is a caveat. Your film must have some sort of value to festival programmers. How does a film have value? By premiering at a world class festival (Sundance, Berlin, SXSW etc or at a prestige niche festival) or having notable name cast. Those are things that other festivals prize and are willing to pay for.

You should try to carve out your own festival distribution efforts if a sales or distribution agreement is presented. That way you will see these festival screening fees and immediately start receiving revenue. Our colleagues, Jeffrey Winter and Bryan Glick, typically handle festival distribution for members of The Film Collaborative without needing to take ownership rights over the film (unlike a sales agent). TFC shares in a percentage of the screening fee and that is the only way we make money from festival distribution. No upfront costs, no ownership stake.

Deliverables

This is an expense that many new filmmakers are unfamiliar with and without the proper delivery items, sales agents and distributors will not be able/interested in distributing your film. You may also find that even digital platforms will demand some deliverables. At TFC (as well as with any sales agent/distributor), we require E&O insurance with a minimum coverage of $1,000,000 per occurrence, $3,000,000 in the aggregate, in force for a term of three years. The cost to purchase this insurance is approximately $3000-$5000. Also, a Closed Captioning file is required for all U.S. titles on iTunes. The cost can be upwards of $900 to provide this file.  Additionally, many territories (such as UK, Australia, New Zealand and others) are now requiring official ratings from that territory’s film classification board, the cost of which can add up if you plan to make your film available via iTunes globally. For distributors, closed captioning and foreign ratings are recoupable expenses that they pay for upfront, but if you are self distributing through an aggregator service, this expense is on you upfront.

You may also be asked to submit delivery items to a sales agent or a distributor such as a HD Video Master, a NTSC Digi- Beta Cam down conversion and a full length NTSC Digi-Beta Pan & Scan tape all accompanied by a full Quality Control report, stereo audio on tracks 1&2, the M&E mix on tracks 3&4 and these may cost $2000-$5000 depending on the post house you use. If your tapes fail QC and you need to go back and fix anything, the cost could escalate upwards of $15,000. Then there are the creative deliverables such as still photography, key art digital files if they exist, electronic press kit if it exists or the video footage to be assembled into one, the trailer files if they exist. Also, all talent contracts and releases, music licenses and cue sheets, chain of title, MPAA rating if available etc.

Distribution is a complicated and expensive process. Be sure you have not completely raided your production budget or allocated a separate budget (much smarter!) in order to distribute directly to your audience and for the delivery items that will be needed if you do sign an agreement with another distribution entity. Also, seek guidance, preferably from an entity that is not going to take an ownership stake in the film for all future revenue over a long period of time.

For those headed to Park City, good luck with your prospects. TFC will be on the ground so keep up with our Tweets and Facebook posts. If the offers aren’t what you envisioned for your film, be ready to mobilize your own distribution efforts.

 

December 19th, 2013

Posted In: Digital Distribution, Distribution

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By Stacey Parks

This is an excerpt of the interview Stacey Parks did with our own Orly Ravid regarding digital distribution. Stacey’s book is now available in paperback and kindle versions at www.FilmSpecific.com/Book.

 

What To Expect From A Distribution Deal: Interview With Orly Ravid from The Film Collaborative 

 Q: What’s it like for filmmakers these days in terms of getting traditional theatrical, broadcast, and DVD distribution deals for their films?

A: I think that film like any business, is affected by market forces.  There’s more supply than there has ever been.  The means of production have become less expensive and more accessible and film has gotten even more and more popular as evidenced by the proliferation of film festivals and film schools and corporate brands who have initiatives relating to film (contests and such).  There are thousands of films for sale in markets such as Cannes & AFM each year and that’s not counting the projects in development, also for sale.

So the bottom line is that there’s simply an excess of supply over demand. And the other factor that has changed is the attrition, if not the collapse, of the middle B2B infrastructure that did emerge and sustain with VHS & DVD, but that does not maintain with digital distribution.  The reason being is that when there were many DVD stores (and VHS before that) the businesses were in competition and they all needed product and weren’t always sure of what would sell or rent well so they actually stocked up, which gave the distributors a huge upside and that potential upside lead to healthy competition, which lead to a healthier business. These days, many video stores are out of business and the ones that still exist (such as Walmart) buy cheap and then return what does not sell (not that that did not happen before, but to a lesser extent), and so the traditional distributors proceed with greater caution when it comes to acquiring new films for the pipeline.

Then there’s the other issue of piracy which leads to less consumption overall and now over 20,000,000 subscribers wait for a film to be available on Netflix which can be healthy business for smaller films that otherwise could not sell well, BUT it’s not great for films that could or would sell otherwise.

The theatrical business is also hurt by both over-supply and by the ‘Netflixing’ of the U.S market.  Digital distribution is there, but again the oversupply makes things competitive and the price points are different so volume is critical, hence the middle man aggregator can do well if it has a breadth of content, but individual producers need to have a film that competes very well in order to be made whole.

And then lastly there’s the Broadcast market. Well, as TV and the Internet become one, TV buying is less of a reliable source of revenue, prices have come down considerably and more rights / revenue streams are impacted when prices are higher such that the net is affected.  Of course, bigger films can be exceptions and studios have their deals. But for the independents and smaller films, Broadcast deals are harder to get and worth less when one gets them.  And nothing but a change in supply can change any of this because technology is certainly not going backwards.

Q: I know you’ve been a champion of ‘newer’ distribution platforms like Video On Demand (VOD), but what’s in it for the filmmakers?

A: I don’t champion them as much as I address that Cable VOD is responsible for 80% of the revenue in the digital space, which is not the same as all VOD. Films that do well in VOD can make 5 and 6 figures in revenue.  By contrast, films that don’t do well make much less and sometimes almost nothing. The truth is VOD is not some magic pill; it’s simply a new delivery mechanism, with some advantages over physical media in terms of accessibility and with some disadvantages in terms of even greater glut and not always great recommendation engines or as easy of time to market (images are smaller, you don’t have as much real estate to market the film).  The proliferation of the iPad is expected to increase the transactional rental business (ex: Netflix) and that interface is also seemingly more filmmaker / film consumption friendly.  In any case, no one in distribution thinks DVD and physical media is going up; it’s only going down so for home entertainment or entertainment on the go (e.g. mobile), digital is here, we have to make the most of it.

Q: In your opinion, do film festivals still play a key role in helping filmmakers find distribution for their films? Or have you seen cases where skipping the festival route and going straight to distribution is OK too? 

A: If your film is festival-worthy or festival-appropriate going that route can never hurt and in fact, often helps. The better the festivals are, the better the film can succeed in terms of sales and also often in terms of audience awareness and interest.  Skipping festivals makes sense for non-festival-type films.  For example, genre films normally don’t need festivals although sometimes they can be helped by a good festival strategy. I think now more than ever festivals play a key role in helping audiences find films and filmmakers find audiences. AND, since at least 5 years ago I have been championing festivals getting involved more in distribution.  I expressed that enthusiastically to the folks at Sundance starting in 2009 and also to other niche festivals too. I truly believe that a more distribution-centric strategy makes sense for both filmmakers and festivals, though only for festivals with a strong brand or niche appeal.

Q: What about foreign distribution? In your experience is this still a major revenue stream for the filmmakers you’re working with?

A: Only for some of our filmmakers – for example, genre filmmakers, niche filmmakers, and some of the more commercial documentaries. For the others, it’s not really a viable option. The money for foreign distribution deals is so small for most films so we end up licensing the films when possible for a good enough deal and otherwise invoke a direct digital distribution and DIY strategy.

Q: What are some things filmmakers need to look out for when making any distribution deal? In other words, what are some of the biggest mistakes you see filmmakers making in regards to negotiating distribution deals?

A: I covered this a bit in my recent blog post and I do encourage filmmakers to read the blog when the topic relates to them because it covers a lot.  Some of the key mistakes in short are:

1. Not getting references and checking on those in order to evaluate the verity of the distributor’s claims.

2. Not knowing enough and analyzing enough the degree of middlemen between the distributor and each key revenue stream.

3. Not having enough protection for material breach.

4. Not defining and also capping recoupable costs properly.

5. Giving up too many rights for too little reason.

6. Having blind faith and being too passive in one’s own responsibility to know the film’s audience and how to reach it.

7. Not having good photography or images to help market the film.

8. On the pro distributor side, sometimes filmmakers think they know better and can do a better trailer for example. They may be right but they can be wrong too and be too close to the film to know how to “sell it”.

 

Stacey Parks is a Producer and film distribution expert with over 15 years experience working with independent filmmakers. As a Foreign Sales Agent for several years, she secured distribution for hundreds of independent worldwide. Stacey currently specializes in coaching independent filmmakers on financing and distribution strategies for their projects, and works with them both one-on-one and through her online training site www.FilmSpecific.com The 2nd edition of her best selling film book “Insiders Guide To Independent Film Distribution” (Focal) is now available at www.FilmSpecific.com/Book.

 

May 1st, 2012

Posted In: Digital Distribution, Distribution, Marketing

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In a new media world in which people sometimes conflate distributor with platform and buyer with online/digital store, I want to draw that distinction and highlight a few new and compelling DIY options (platforms or toolkits) for filmmakers to sell or rent their films to audiences / consumers directly.  TFC always encourages filmmakers to develop their own brands while also noting the importance of being connected to other brands that generate significant traffic and indie film consumption.  In other words, sell direct to your fans off your site and other sites and social networking platforms and/or via other DIY platforms or tools but also recognize the usefulness of being available where average film consumers go, i.e. via Cable VOD if you can manage it, and other key platforms/online digital stores (depending on the nature of the film) such as: Amazon, Netflix, iTunes, Vudu, Hulu, Sony Playstation, Xbox etc.

The few DIY platforms or toolkits highlighted in this blog are:  Distrify, EggUp, Groupees, Stonehenge’s iPhone Apps.  Next time we cover this topic, we’ll investigate more into DIY platforms FansofFilm www.FansofFilm.com and Open Film www.OpenFilm.com (7,000 films, 70% shorts).

Let’s begin.

DISTRIFY www.Distrify.com

Peter Gerard & Andy Green, the co-founders of Distrify, are both filmmakers who formed Distrify. I met with Andy @ SXSW.

Distrify is not a film sales platform – it’s a toolset. One can use Distrify to sell a film anywhere on the web and via social media platforms. Once your trailer and film are on Distrify you embed it on your website like http://www.justtogetarep.com/ and Facebook page like https://www.facebook.com/just.to.get.a.rep?sk=app_203403406338325

You can then start telling your film’s fans about it and ask them to embed the widget on forums, blogs, websites, etc.

Distrify’s “sell-movies-socially” tools are designed to make effective social media marketing profitable. If your trailer and film are on Distrify, when you share the clip, you’re also sharing the store to buy the film or find out about upcoming screenings. When your audience shares it further, you’re always spreading the point-of-sale along the way. Anyone who shares it gets paid a share of sales they generate.

One does not have to start selling through Distrify right away – one can use it to promote screenings and events through the trailer interface. Here’s an example of an upcoming Anime release that is using the Distrify player to promote upcoming screenings: http://www.we-loveanime.com/

If the film’s not available in the user’s area, they can make their interest known directly through the player as well. Distrify compiles the statistics for filmmakers and give them the mailing list data – all free. Any new screenings you add are also automatically listed in all the players that have been embedded around the web. And when you want to start selling the film, you can add it as well.

There are no up-front charges, fully non-exclusive, and they don’t need any rights.  They take a small transaction fee on sales (see specifics below).

In the Beta period it is free to sign up and upload one film to Distrify. They don’t charge for uploading or hosting and there is no subscription fee for a Beta account. They do charge a 30% revenue share on sales. They note that their profit “is around 3% to 5% so it’s costing us around 25% to deliver the service to the customer . We’re working hard to reduce these costs and when we do we’ll hand the saving over to the rights holder.”

Peter Gerard followed up noting that whilst still in Beta their pricing is FREE to sign up and sell one film and a 30% transaction fee on all sales through their player and there are no costs for special encoding. Their Beta period ends in June and after they will continue this pricing option and offer some premium plans.

Distrify Beta Pricing

Free sign-up for a one-film account

They charge a 30% transaction fee on all sales made through Distrify

They split the 5% affiliate revenue with the filmmaker.

Beta users will be given a special offer when they leave the Beta period, and normal account pricing will be determined at that time.  And filmmakers keep all their rights.

How do you get paid?

Each month if you’ve earned sales revenue they will send you a sales report and transfer your earnings to you directly via PayPal or bank transfer. You may be charged by PayPal or your bank to receive the transfer. When you get your first sales report, they say “just let us know how you prefer to be paid”.

What about affiliates?

“We will soon offer your audience the ability to earn a share of revenues that are generated from their sharing. Once this is enabled they will earn 5% from each sale they refer to you. We are currently offering to split the cost of the revenue-sharing with you. This means we only charge 27.5% on a revenue-shared sale. You keep the remaining 72.5%.”

EGG UP www.EggUp.com

“EggUp is a publishing platform for filmmakers and film distributors. We help filmmakers and distributors rent and sell their films online while preventing piracy. Our free online publishing tools can help you distribute and sell your film or video which is all packaged and encrypted into a file called the Egg. The Egg is currently available for download and allows consumers to watch and share with friends and family virally while filmmakers are able to make money. With EggUp you get your own website to promote your film, together with an integrated pay per view solution. We also list your films in our film catalog called GoEggit. Distribute the Egg on your own website, and other online retailers with your very own buy now button without setup fees and inventory.”

Payment options: FREE, Rental, Purchase. Filmmaker will be able to choose several options.  Accept Paypal and major credit cards.  Customer credit card information does not go through their servers. They only link to the filmmaker’s Paypal account. Paypal holds customer’s credit card info.

They are Worldwide and can Geo Filter as needed.

Content: Currently about 60 films due to focusing on developing technology and negotiating deals with international governments and studios. They will be ramping up pretty quickly in the next 3-5 months with content.

When I asked about revenue thus far to filmmakers they answered with this: “It really varies since it’s up to the filmmakers. Some filmmakers make $0 due to they are not marketing their content or older film with no cult following. While others are getting consistent purchases daily since they have a full marketing strategy including PR pushing their film. It adds up but nothing making millions”.

EGG UP’s FEES:

Full length features: $1.25 per transaction ($2.00 – $1,000.00 retail)

Short film: 15% per transaction ($0.99 – $1.99)

EggUp noted that they are reviewing their fee structure and may be changing it soon.

Egg Up Overview: Image

http://i811.photobucket.com/albums/zz38/Egg_Up/EggUP_Overview3.jpg

Egg Up Filmmaker Benefit: Image

http://i811.photobucket.com/albums/zz38/Egg_Up/EggUP_Filmmaker3.jpg

JON REISS’ GUEST BLOGGER Solomon MacAuley– Raved about EGGUP:

http://jonreiss.com/blog/2011/03/03/prevent-film-piracy-and-globally-monetize-instantly/

SHERI CANDLER interview for MicroFILMMAKER Magazine about EGG UP:

http://www.microfilmmaker.com/tipstrick/Issue58/EggDist1.html

GROUPEES (YAWMA) groupees.yawma.net & yawma.net

I was introduced to this platform via TFC client Ari Gold (Adventures of Power).  Thomas Brooke who demo’d the platform / service via Cisco’s WEBEX.  I was impressed with the simplicity and comfort of the interface.

Thomas Brooke is the Founder and CEO of YAWMA. YAWMA is the social media technology company that operates Groupees. Thomas describes GROUPEES as:

“A Flash sale (24-48 hr) platform focusing on digital media entertainment (music, games, film)
- Like Groupon in the sense that we’re crowd-sourcing but deal isn’t dependent on a certain number of users buying and “tipping” the deal; rather we start with the good deal but the content owners set a goal and if achieved it unlocks extra exclusive content (to incentivize users to work as a group and spread the promo through their social graph)
- There is a high degree of Facebook and Twitter integration so purchases spread virally
- Flexible SaaS based system supporting product bundling, multiple pricing options (fixed price, pay what you want), inclusion of charity, etc.  We’ve set Groupees up as an on demand platform where content creators/licensors sign up to run a single promotion, all of which is configured through a web interface. It is a platform by invitation only- we’re sourcing quality independent music, games and film.”

Their next Groupee starts on Wednesday so if you go to: http://groupees.yawma.net

you will see the promo vid and count-down clock now live.

Here is a screenshot and the model we’re using for projections on Music groupees:

FEES: The model split is reflected at 60-40% (in favor of filmmakers / same as Apple’s fees) which is their standard rate…

When I asked why they were more expensive as Apple (which takes 30%) Thomas answered: “While it is true that Apple takes 30%, they don’t do anything for their 30% beyond providing a distribution system. Fact is we’re not just a point of distribution. We’re pretty sophisticated technology with a high degree of customization, strong FB and Twitter integration and 100% pr support (strongly question this, what do they mean by 100% PR support?) for every promotion we run. Groupon is really a better business analogy, and they take 50% but have nowhere near the social media integration or customization features. I do appreciate your asking whether to make mention but I’m certainly comfortable with this.”

“In terms of film/video, we can support straight download in any format and also video streaming. As mentioned, the service requires buyers to register so all files are secured behind a firewall. I think for indie film the concept of bundling films from different film-makers might work very well as it provides good cross promotion and from the consumer’s perspective allows you to get two cool films from a single purchasing experience. Definitely one of the premises of our platform is convenience as people are overwhelmed by our digitally connected world so by featuring quality indie entertainment as a part of a single promotion, consumers get the benefit of a curated good deal on relevant media/entertainment. I think also there is an opportunity to bundle films with music, especially where there’s a good thematic connection. Obviously, a soundtrack with a film is a no-brainer as well. We’re also currently looking at possibly bundling a video game that is from the horror genre with a horror film. “

Groupee Platform Features

  • Support for all digital media formats
  • Support both video download and streaming
  • Web-interface for creating and configuring the Groupees promotion
  • E-payments through PayPal and Amazon payments
  • Live World map that tracks purchases as they occur around the globe
  • Facebook and Twitter integration so purchases spread virally
  • Real time sales statistics and reporting
  • Flexible promotional programs including Fixed Price or Pay What You Want payments, charitable giving, cross-promotional bundles, goal setting with incentive giveaways
  • Cloud-based, highly scalable platform capable of supporting 1,000,000 downloads per 24 hrs.

STONEHENGE – Distributing films  worldwide via Phone Apps www.StonehengeProductions.com — FilmApps…Get Your Film in More Hands

Stonehenge Productions enables film producers to sell their films on iTunes, Android Market and Amazon Appstore as applications for the iPhone, iPad and for Droid platforms.

Their pitch: “With a low start-up cost of just $680, you can have an application of your film available on Phones everywhere !! You keep 100% of sales revenues minus the 30% that Apple charges.”

What do you get for $680?

    • An iPhone FilmApp
    • Embedded film in the App (better than streaming)
    • About page/synopsis
    • Twitter/FB/Email (Sharing) integration,
    • A merchandise page for users to buy merchandise, DVD…(e.g. Amazon)
    • Links to the film’s/director’s site (opens within the App)
    • A trailer/video clip viewer (user can watch the trailer, clips, outtakes, behind the scenes)
    • Photo gallery of shots from the film
    • an RSS/News feed for any feed you would like to provide.
    • Custom Graphic design and layout (using your art).
    • Turn around is typically two weeks and then 7-10 days at Apple.
    • Got other ideas? Let us know what you’d like

How?

Contact Stonehenge Productions and we’ll provide you with further instructions to upload your content. It will then be turned into a customized application. You’ll get final review and you’ll continue to hold all rights to the film.

We’ll submit it to Apple and manage the whole selling process through the App store OR we’ll put it on the Android Market or Amazon Appstore.

A Stonehenge Sales Sheet: http://www.stonehengeproductions.com/sales-sheet/

Mark Smillie of Stonehenge notes “we are really working hard to build FilmApps that encourage participation over the lifecycle of the film…so pre-release to build awareness and fan base, at release to drive fans to the theater and post release to sell the film through the App channel.”“We build for Apple, Android and sell on the iTunes, Droid and Amazon app stores.”

Their latest press release for our App for the film: Race to Nowhere.  It’s a good example of a social activism app paired with a film App.  http://www.prweb.com/releases/2011/03/prweb5193274.htm

Another testimonial Mark showed me is from John Paul Rice of “One Hour Fantasy Girl” “Apps for films work: Itunes report for One Hour Fantasy Girl in Q4 2010, rental/downloads up 558% over Q3. Credit goes to @WeGoTo11”  John Paul Rice President No Restrictions Entertainment from Twitter:https://twitter.com/norestrictions/status/53291871367200768

* That’s all for now folks. More platforms and tools and DIY solutions next time.

April 12th, 2011

Posted In: Uncategorized

New services and new thinking finally are starting to take hold at major festivals and in the independent film world in general. Productions that can bring donation money, matching funds and/or strong promotional partners to the negotiating table have an advantage when it comes to landing significant distribution.

-At Sundance, the BFI offered up to $51k in matching funds to help market the US distribution of their 3 funded films in the festival.

-At Toronto (TIFF), Vimeo offered a $10k advance for world premiere films that gave them a 30 day exclusive streaming VOD window. 13 films accepted the offer and have started to  premiere on the service.

Linsanity, Big Joy: The Adventures of James Broughton, Love and Air Sex (AKA The Bounceback), Before You Know It, Citizen Koch have all raised distribution funds on Kickstarter and are using those funds for risk free theatrical releases.

While sales deals lagged at Sundance this year, all 3 BFI funded films secured distribution. Those films are the only World Dramatic and World Doc titles that have sold since the festival. The clear advantage of offering marketing dollars coupled with the ease of selling English dialogue to an American cinema audience attracted 3 smaller distributors to make early buys they may not have otherwise and guaranteed US distribution for films that may not have found it. It’s hard to argue with free marketing money and support from the country of origin. Though $51k is unlikely to make much of a difference to sway a major studio interested in wide release films,  DISTRIBUTION INCENTIVES certainly won’t hurt the chances of a deal because everybody wins in that scenario.

Also coming out of Sundance, Strand Releasing snagged Lilting, the newly formed Amplify made their first acquisition ever with God Help the Girl and Drafthouse Films caved in to 20,000 Days on Earth.  Let’s take a closer look at these three distributors.

Strand Releasing put 11 films into theaters last year and only 1 grossed over $50k.

Amplify is new to the game, but not really. Variance has been putting DIY/service releases into theaters for a while. Half their films last year grossed under $60k.

Drafthouse Films released 6 movies last year. Of those, 2/3 did not gross over $50k

photo credit Flickr Stock Monkeys

photo credit Flickr Stock Monkeys

Obviously, some of the films make much more in the digital marketplace after their theatrical release (or in some of these cases, during the release as many are day and date), but the point can’t be lost. Incentives really do attract distribution attention. They are like coupons for distributors and help to reduce risk.

I can bet you right now that there are dozens of filmmakers who are kicking themselves for turning down Vimeo’s offer at TIFF. Especially since the offer didn’t interfere with distribution offers for a film like Cinemanovels, that made an agreement for a traditional US distribution deal on top of their $10k advance from Vimeo.

Looking at the filmmakers who have used Kickstarter to secure funds for distribution, there is a wide range in how the films performed and a few have yet to be released, but they effectively created a risk free theatrical model. Their distribution funding was donated, there is no investor to repay so they can keep the revenue. I feel comfortable saying that in almost every case, each film will make more money than they would have in a traditional theatrical distribution arrangement. Very smart!

As I get ready for the “spam on steroids” that is SXSW, I encourage filmmakers to think of what they can offer that will make their films an attractive buy. There are so many events and screenings at any given time, it’s impossible for an organization like ours to cover them all, but if I know a film has incentives in place, it makes a huge difference when I prioritize my schedule. The film market is no different than any other business. Your film is a commodity and making a good product isn’t enough. You have to come to the table with something else to offer. Don’t wait until it’s too late. Don’t risk having a premiere with no incentives in place.  Strategize now! Get partners on board, build relationships with an audience, raise extra funding through crowdfunding (this brings money AND an audience to the table) and show you know the market for and business of your art.

February 26th, 2014

Posted In: crowdfunding, Distribution, Film Festivals, Theatrical, Vimeo

Tags: , , , , , ,

In our continuing look at film sales, today we are featuring an interview with an international sales agent for independent films, Ariel Veneziano of Recreation Media. He has handled international sales for many films including the highest grossing documentary of its time Michael Moore’s Bowling For Columbine, the highest grossing independent film of all time Mel Gibson’s The Passion of the Christ, and America’s most watched television show CSI: Crime Scene Investigation. The Film Collaborative works closely with Recreation Media for its international sales efforts.

SC: How are things different now than they were 5-10 years ago?

AV: In one word: worse.  Sorry to start this off on a down note!

SC: Do you mean money-wise or just sales interest at all?

AV: I think both. It is best to acknowledge what the reality is. At the same time, there are some opportunities that have emerged, new ways of doing business that didn’t exist several years ago. It is important for filmmakers to have a reality check that there have been changes in the way viewers consume media and that has led to radical changes in the market. People go to movie theaters to see independent films much less than they did. Although global box office appears higher, this is only for a very small percentage of films. We’re talking Twilight, Iron Man, Dark Knight, James Bond. That share of the box office numbers is cannibalizing all of the other films out there.

Home entertainment revenues have been shrinking. DVD is progressively becoming marginal, and while broadcasters are multiplying, the license fees they are paying, especially for independent product, are getting smaller. While VOD and digital distribution are on the rise revenue wise, there is also an overabundance of product being made because of the sudden availability of low cost production methods.

Piracy is a threat to revenues. People still watch movies, but they don’t always pay for them. There is now a generation who sees this like going to the faucet and turning on the water, you don’t pay for every glass you fill. You pay a monthly fee and you can get a lot of water. Same with many internet subscriptions, one fee, unlimited choice. The good side to digital and particularly online distribution is the ability to, in theory at least, reach a broad audience without need for a large infrastructure. Are there ways to capitalize on that trend? Yes. Are they easy? Not necessarily, it is a very fast moving situation and even the so called experts who have done this for years, they don’t know what is going on. There’s a lot of chaos here, the wild west.

SC: If we were to look at 5 years ago, what would have been a pretty normal deal scenario for an independent film with no names, but some festival pedigree?

AV: If we’re talking about one of the major festivals, like Cannes, Venice, Berlin that you could put on the poster, those are the big 3, you could have made several hundred thousand dollars in worldwide sales. But that’s not necessarily the case anymore.

SC: Right, I was noticing out of Toronto in September that films with more than notable names were being picked up in groups for $5 million, when their budgets must be nearer to $20 million combined. Lionsgate/Roadside Attractions bought Stuart Blumberg’s “Thanks for Sharing,”(Gwyneth Paltrow, Mark Ruffalo, Tim Robbins),  Shari Springer Berman and Robert Pulcini’s “Imogene” (Kristin Wiig, Annette Benning, Matt Dillon) and Joss Whedon’s “Much Ado About Nothing”, all of them for a reported $5 million. So those films are not making their money back in advances. It used to be you could be made whole or close to it, but now that is not nearly the case.

AV: Right, it means you have to be smarter with the budgets, keep them low. Smarter with the finance plans and use soft money, something that isn’t going to be high risk for investors. What happened in the music industry is now happening to film. When is the last time you bought a CD? With technology progressing so fast, storage capacity growing, speed of transmission of data, availability of mobile devices. Few people are going to want a DVD collection, why? I can access a gazillion movies in my cloud storage. So if people aren’t really spending money on music, the revenues for albums have gone way down. Why would they continue to spend for films? If you want to know what the future holds for the film industry, look at the music industry.

And because there is so much uncertainty, buyers are trying to safeguard themselves. They are being much more particular about titles they take on and for what prices because they don’t know how well it will sell.

SC: So when you go to a market, what attracts their interest to buy anything?

AV: Bigger theatrical pictures. For foreign buyers, they want to know the film will have a wide domestic theatrical release. Some domestic distributors can promise that like Weinstein, Summit, or if you are an international sales agent who struck a deal with a studio early on to release the film with a minimum 1000 screens, buyers are receptive to that.

Cast of course makes a difference. Certain genres like action do very well. Everything related to action travels well. So, adventure, sci fi, thriller, fantasy are all cousins of the action genre and those typically do well.

SC: One genre I see a lot in indie film is the “coming of age” drama story. How well does that kind of story do?

AV: AWFUL  in terms of revenue. I am talking as a businessman. As a viewer, I love coming of age dramas, but I can’t sell them. Nobody wants to buy them unless: 1) it is directed by a world class filmmaker. If it is a Woody Allen or Terrence Malick film, you’ll sell it 2) big names in the cast and when it comes to getting buyers excited about the cast level, the bar has gotten a lot higher as far as this  3) based on a best-selling novel 4) selection in a MAJOR festival. For international revenue that would be Cannes, Berlin, Venice. Sundance has an impact domestically, but internationally people don’t care. Toronto the same, it is fine for a repeat screening, but if that is your only claim to fame, not going to help you that much.

Coming of age drama is one of the worst for travel; that and comedy. Buyers just flee unless it comes with any or lots of those 4 criteria. So Terrence Malick’s Tree of Life, fits 3 of those criteria. World class director, A level cast, major festival selection. That is desirable to buyers.

SC: So you are really saying that a microbudget indie film with all of those things absent really has no chance for a buy at a foreign market?

AV: None.  Absolutely zero.

SC: This is good to know, we’re tempering expectations here. This doesn’t mean there is no audience for the film. It simply means that it has no value to a buyer.

AV: It is going to bring in too little money for them that it isn’t worth investing in. But you’re right, does it mean you can’t put it on iTunes or some other online outlets on your own and get people in foreign countries to pay to see it? You can absolutely do that. But since it is such a wild-west scenario at the moment, the revenue could still be zero for you.

SC: Are you saying that there are no prospects even in broadcast for this kind of film?

AV: No prospects, but as with anything there are a few exceptions. A Lifetime movie, like a women in peril kind of film. If it was bought by Lifetime in the US, then there could be some broadcast value elsewhere. But that is a very specific kind of film, very formulaic.

SC: What about a low budget documentary? What if it was picked up by HBO in the States?

AV: Now we’re mixing types of films. Docs are a little bit different, but it depends on what they are about.  If it strikes the right chord with something timely, you find the right broadcaster who is filling their schedule with a thematic type of programming and your doc fits that profile, then boom you have a deal. A small deal probably, but still a deal.  A theatrical doc is the exception, docs are mostly for TV. Having it on HBO? No, it doesn’t make a difference. Not PBS either. It is more about the right subject matter, being topical.

The brands broadcast buyers respond to for narratives are Syfy Channel, Lifetime, Disney, Nickelodeon,  maybe Hallmark. Again, those films are very specific and formulaic. No fancy effects, no flashbacks and weird montage, just very straightforward stories.

SC: A foreign sales agent does what? You go to markets, but what is done in between? Should I get a specialist foreign sales agent or a worldwide sales agent?  

AV: Typically domestic and foreign markets are two different animals. There are some sales companies that can act as a good one stop shop, handling both within the same company and that can simplify administration. But the option to hire a dedicated domestic sales agent – also known as a producer’s rep – is a common way to go as well.

What we do as a sales agent is that we help you maximize revenue on the film from all available sources around the world. So that entails marketing, highlighting an existing campaign or creating a new one; working the press, getting a film into the right festival. Then leveraging the relationships we already have with buyers around the world. Negotiating and papering the deals. Delivering the movies. Invoicing and collecting the revenue. Monitoring how a film does in a territory and requesting (or demanding!) the revenue reports. Structuring the deal correctly so you can have some money up front and then see more money later down the road – if the film does well. It is a “technical” job and is very relationship driven.

Probably the most important aspect for a filmmaker in electing a sales agent, is working with someone you can establish a relationship of trust with. Trust can be an elusive thing sometimes. You keep hearing stories about filmmakers being ripped off by sales agents. Some films are probably not meant to be handled by a sales agent because it is just too many layers of middlemen for too little available revenue, and the filmmaker would have been better off handling it themselves for the amount of sales revenue that can be gained from it. It will be a lot of work though for the filmmakers and some people are very naïve about that, thinking ‘oh who needs a sales agent?’ and they take their film to markets or put it up for sale themselves online and at the end of the day, a lot less revenue comes in than they thought. It is a lot harder to make money than it seems…

SC: Sometimes filmmakers try to call buyers and they find their calls aren’t returned. Buyers don’t know who they are.

AV: Trust me, sometimes we have trouble getting them to return our calls too! And they do know who we are.

SC: What is the typical length of time for a sales agent agreement?

AV: There are two types of agreements. One is a straight distribution agreement where the sales agent comes on just to sell the film into territories. Another is when a sales agent comes in with a minimum guarantee, some money upfront. If they put in some money, they will be more demanding on the terms. If it is just straight distribution, the filmmaker has more leverage to negotiate it.  So a typical term is 10-15 years.

SC: Why does it need to be that long?

AV: Well there are two questions here. The first is the sales agent’s engagement term. How long is the agent going to be selling the film? And the second is for how long is the agent allowed to sell the rights? How long will the contract last for each deal brokered?  I might sell the film to a buyer in the first year, but the buyer might want a 20 year contract on that film especially if it is an all rights deal where they can exploit each window over a long length of time. They might spend a lot of money to release the film theatrically and make up the bulk of that money on DVD/VOD and then digital then broadcast which can then mean relicense and relicense over a long period of time. You know, when you watch TV, there are rerun movies, things that came out a long time ago. Those  have been relicensed over time.  So if you are going to all this effort and expense, you want to have a long period of revenue coming in on that.

If a producer and a sales agent have a good relationship, they should both want that. It is not just about selling and walking away, there is the monitoring of the sales.  You may get an advance from the buyer, but then there is a revenue sharing structure that has to be enforced. A buyer might release theatrically and not make money, but then it goes into DVD and broadcast, and especially in Europe broadcast is where a lot of the money is, when that revenue is coming in, you have to make sure reporting is being done correctly.  That can be many years after the fact.  If a film is doing really well, you may have to check the reports or audit them to make sure you are getting all that is due.  It can be complicated to do this and costly. You want your buyer to comply, but you may have to send in someone to check the records. You need to manage the revenues coming in, the agent gets commission and expenses and then the rest flows through to the filmmakers.  So for us this lasts 15 years typically.

SC: 15 years to maintain the film, the sales contracts on the film?

AV: Yes.

SC: So then the question is if after a year or two, the agent hasn’t made deals in many territories. Why should they still hold the rights to my film for 15 years? If I know that I have an audience in Indonesia based on my website traffic, but it isn’t enough to satisfy a broadcaster or a distributor in that territory, I could service them directly from my website, but I can’t do that because legally I don’t own my film, the agent does.  An agreement for that length of time in this case doesn’t seem to serve anyone.

AV: Well in TV sales it can take a while for a sale to come through. The decision making process is slower in TV.  Also it can be about the right theme being programmed in the schedule.  A film may not be a fit for this year’s schedule, but maybe for a schedule 2 years from now.  If the agent has the rights to a film that fits, a sale can be made then.

But I think good practice for a sales agent is to yield to the filmmaker if they find after a reasonable amount of time that there is no real sales potential.  A clause should be worked into the contract that after X amount of time, if no sales are pending and interest is limited, then the rights go back to the filmmaker or the sales agent agrees to arrange for another type of distribution (iTunes aggregation or other kind of digital VOD distribution) and any revenue would be subject to whatever commission was agreed – if the sales agent helped to get the film onto a revenue generating platform, then they should get a commission out of it.

SC: Walk me through the revenue flow. If it is just a straight distribution deal, the agent has not given the filmmaker an MG to represent the film, how does the money flow from the buyers through the sales agent to the filmmaker?

AV: Everything is up for negotiation, but here’s the typical structure. The revenue comes in from the distributor, the agent takes a commission,  then the agent takes reimbursement on the expenses that have been capped and agreed, then the filmmaker gets the rest. Let’s say there is $100,000 of revenue. Commission is 20% and the agent spent $10,000 in expense. The commission is $20,000 plus the $10,000 for expenses so $70,000 goes to the filmmakers.

SC: Ok say that it isn’t $100,000 in one go. Say it is $2,000 this month and $5,000 last month and all of this revenue flows through the agent.  Does that mean every time there is revenue, the agent gets 20% of it, or is this a flat 20% of all revenue?

AV: Usually reporting is on a quarterly basis in the first year or two and after that it is only twice a year.  So every time there is a statement, commission is disbursed.

SC: And how do you show me expenses? How do I know what my expense was for the trailer or the one sheet design and printing or the market booth?

AV: Again different companies have different practices, but typically expenses are amortized across all of the current titles the sales agent is handling. We have costs from the markets that we split across the slate of films. We do a fair assessment of the films we are actively selling and then there are direct costs. If we hold a screening of a film in a venue during the market, 100% of that cost is going against that particular film. But a booth at Cannes for all of the active slate of films, that cost will be amortized across the slate. So everything should be documented as far as expenses. If you feel like the expenses are unfair, you should have audit rights in your agreement.

When you have that ongoing relationship with your sales agent and they are motivated to do repeat business with you, they will want to do things right. Ideally you want to work with someone you can 100% trust, but we hear every day how there are disputes in Hollywood studios, independent studios. Lots of creative accounting, people don’t always report accurately and things end in arbitration or litigation.

SC: A few years back someone on a panel said that especially in low budget filmmaking there are a lot of first time filmmakers, but not a lot of second time ones. So relationship building on either side, the agent or the filmmaker, there isn’t a lot of loyalty there. The filmmaker may  never work again, the agent may not even want another film from this person, the filmmaker will choose whatever agent seems to be bringing them the best deal.  So is the motivation to be loyal and honest really there?

AV: Well maybe filmmakers should have more of a career plan. Don’t think one film at a time, but have a vision for what your career will look like and plan for the relationships that will help you realize it over time. Also, films aren’t made by only one person. There is the producer, the director, the writer, the cast and sometimes cast members are also producers. There can be relationships with all of these people that benefit a trust factor being present.  And then there is the carrot and the stick principle. Yes, we want to have relationships where we believe all are being honest, but we know some people are more honest with those they know than with those they don’t. You have to trust, but verify.

You can always question what doesn’t seem like a reasonable expense.  You won’t go through every receipt and say ‘are you sure at that dinner you talked about my movie?’ Come on, you aren’t going to do that. But if you see some weird expenses for things you don’t remember happening, like a screening at a market, then you should question it and request backup documentation. The sales agent should be able to provide it.

SC: Lastly, what kinds of things should be included in my sales agent contract. Should there be non performance clauses, bankruptcy clauses, a limit to the years my title is held by the agent?

AV: Well, I am going to be on the other side of the negotiating table and I will want less encumbrances of course. So who am I advising here?!

SC: If we are transparent and honest people who really want what is equitable, we should be honest about this. Also  what kind of things are you expecting from the filmmaker in the contract?

AV: I will want to be efficient. I want to know that they have all the deliverables ready or in a timely manner. This includes master drive or prints as physical material, but also legal documents. Chain of title, music clearances, E&O everything that is included in the delivery list. So many times attention isn’t paid to the details of this both from the physical perspective, but also the budgeting perspective.  Often these materials have to be created and that costs money and a budget needs to be available for this. We might have an offer that will bring in a good amount of revenue, but if the producers can’t deliver the items required by the buyers, there is no deal.

Sometimes we take on that expense ourselves say a 35mm print might be needed, but one wasn’t made. We wait to see how interest goes at the first market and if 5 territories want to do a theatrical release,  then we will take on that expense because we know it will be recouped.  A 35 mm print may be optional depending on the film, but there are other things that are required. For example an M&E track so that the film can be dubbed in foreign territories.

SC: What is the worst thing people tend to forget or deliver in the wrong format?

AV: One thing that happens a lot is stalling, letting things drag and not delivering the final elements. The final music tracks are being cleared or the M&E track is being finished. Several situations where the film never really seems to be finished.  The deals were struck, the buyer is getting impatient waiting for everything to be sent over. A film isn’t like red wine, it doesn’t get better with age, it doesn’t gain value, it does the opposite.  The film got old and it never came out.

Also, one thing that is perpetually a disappointment: still photography. Good photography is super important to promote the film, to design into the campaign. Buyers really want good stills.  On low budget films, good photography is perpetually dismissed. Make everyone’s life easier, get lots of on set shots. Not behind the scenes stuff with the crew goofing off and doing set ups.  Get shots from the scenes, good shots of the cast, the atmosphere of the scene, things that we will see on screen.

SC: What would you tell someone who hasn’t yet made their film, but they are about to embark on the process. What to expect?

AV: First start with why you are motivated to do this? Making money isn’t always the prime objective for some people. They have an urge to tell a story and yeah, maybe some business person may find it genius, but it is ok if they don’t. Be very clear about that with yourself and others, that you are doing something that has only a remote chance of making money. That way, you won’t be this frustrated filmmaker who is suddenly surprised when all the odds are against you. You knew it going in. Maybe this first film is a calling card and all part of the career plan. Ultimately, if you want to make a career in this industry, you are going to have to make film that connects with paying audiences and make some commercial sense. First films can be something very striking visually or artistically, but not make much or any money. They can have an artistic integrity that isn’t necessarily attractive to a buyer, but can find a small audience.  In order to capture industry attention, the films are going to have to be accessible to an audience.

I thank Ariel Veneziano for sharing his time and information with us. Remember, The Film Collaborative does handle films sales on a limited basis and we are always open to advising our members on the best course for getting their films out to market.

November 20th, 2012

Posted In: Distribution, International Sales

Tags: , , , , , , , , ,

By Bryan Glick

Just because you didn’t premiere at Sundance or Cannes doesn’t mean you’re out of luck. Though not living up to the sales quota of last year, there are two dozen premiere films from SXSW that have sold in the U.S. Here’s a wrap up of the film sales from SXSW.

Anchor Bay stuck with their niche and took North American rights to two midnight entries Girls Against Boys and The Aggression Scale, while Cinedigm (who recently acquired New Video) went for U.S. Rights to In Our Nature and the midnight audience award winner Citadel. Pre-fest buys include Crazy Eyes which went to Strand Releasing for the U.S.  and Blue Like Jazz courtesy of Roadside Attractions. Blue Like Jazz was promptly released and has since grossed close to $600,000 theatrically in North America.  Lionsgate is handling DVD, VOD, and TV through their output deal. Meanwhile Crazy Eyes just started its theatrical run on two screens pulling in a little under $5,000 in its first week.

Millennium Entertainment took the gross out comedy The Babymakers and yet another midnight film, The Tall Man was bought for the U.S. by Imagine.  If you’re a midnight film at SXSW, odds are things are looking up for you. The same could be said for The Narrative Spotlight section where two thirds of the films have since been acquired including The Do-Deca Pentathlon  taken by Red Flag Releasing and Fox Searchlight. Red Flag is handling the theatrical (The film grossed $10,000 in its opening weekend off of 8 screens) while Fox Searchlight will cover the other ancillary markets. The Narrative Spotlight Audience Award Winner, Fat Kid Rules the World was bought by Arc Entertainment for North America and Frankie Go Boom was the first film to reap the benefits of a partnership with Variance and Gravitas.  It will be released in the U.S. on VOD Platforms in September via Gravitas followed by a theatrical in October courtesy of Variance.

And though they did not premiere at SXSW, both Dreams of a Life and Electrick Children had their U.S. premieres at the festival and have since been bought.  U.S. rights to the documentary Dreams of a Life were acquired by Strand Releasing. Meanwhile, Electrick Children was snatched up for North America by Phase 4. Phase 4 also nabbed North American rights to See Girl Run.

Sony Pictures and Scott Rudin took remake rights to the crowd pleasing Brooklyn Castle while HBO acquired domestic TV rights to the doc The Central Park Effect.  Meanwhile, after showing their festival prowess with their success of last year’s breakout Weekend (which was sold by The Film Collaborative’s Co President, Orly Ravid), Sundance Selects proved they were not to be outdone and got the jury prize award winner Gimme The Loot for North and Latin America.  Fellow Narrative competition entry Gayby sold its U.S. rights to Wolfe Releasing, a low 6-figure deal. That deal was also negotiated by TFC’s Orly Ravid. And not to be outdone, competition entry, Starlet rounds out the Narrative Competition films to sell.  It was acquired for North America by Music Box Films.

S2BN Films’ Big Easy Express became the first feature film to launch globally on iTunes. It will be released in a DVD/Blu-Ray Combo pack on July 24th by Alliance Entertainment followed by a more traditional VOD/Theatrical rollout later this year.

Other key deals include Oscilloscope Laboratories acquiring North American Rights to Tchoupitoulas, Snag Films going for the US Rights of Decoding Deepak, Image Entertainment’s One Vision Entertainment Label aiming for a touchdown with  the North American rights to The Last Fall and Factory 25 partnering with Oscilloscope Labs for worldwide rights to Pavilion.

Final Thoughts:  Thus far less than one third of the films to premiere at SXSW have been acquired for some form of domestic distribution. While that may seem bleak, it is a far better track record than from most festivals.  In The U.S., SXSW is really second to only Sundance in getting your film out to the general public. The festival also takes a lot of music themed films and more experimental projects with each theme getting its own designated programming section at the festival. Those films were naturally far less likely to sell. The power players this year were certainly Anchor Bay and Cinedigm each taking multiple films that garnered press and/or have significant star power. Other companies with a strong presence and also securing multiple deals were Strand Releasing and Oscilloscope.  Notably absent though is Mark Cuban’s own Magnolia Pictures and IFC (Though their sister division Sundance Selects made a prime acquisition). Magnolia did screen Marley at the festival, but the title was acquired out of Berlin, and IFC bought Sleepwalk With Me at its Sundance premiere.

While it is great that these films will be released, it also worth mentioning what is clearly missing from this post. There is almost no mention of how much these films were acquired for. The fact is films at SXSW don’t sell for what films at Sundance do and it is safe to assume that the majority of these deals were less than six figures with almost nothing or nothing at all getting a seven figure deal.

As for the sales agents, Ben Weiss of Paradigm and Josh Braun of Submarine were working overtime, with each negotiating multiple deals.

SUNDANCE UPDATE: Since the last Sundance post, there have been two more films acquired for distribution. Both films premiered in the World Documentary Competition. The Ambassador negotiated successfully with Drafthouse Films who acquired U.S. rights for the film which will premiere on VOD August 4th followed by a small theatrical starting August 29th.  Also finding a home was A Law in These Parts which won the jury prize at this year’s festival.  Cinema Guild will be releasing the film in theaters in the U.S. starting on November 14th. 75% of the films in the World Documentary Competition now have some form of distribution in the US.

A full list of SXSW Sales deals from SXSW is listed below. Box office grosses and release dates are current as of July 12th.

Film COMPANY TERRITORIES SALES COMPANY Box Office/
Release
See Girl Run Phase 4 North America Katharyn Howe and Visit Films
Starlet Music Box Films North America Submarine
The Babymakers Millenium US John Sloss and Kavanaugh-Jones Theatrical Aug 3rd
DVD Sept 10th
Citadel Cinedigm US XYZ Films and
UTA Independent Film Group.
The Aggression Scale Anchor Bay North America Blu-ray/dvd Epic Pictures Group
Girls Against Boys Anchor Bay North America Paradigm
Tchoupitoulas Oscilloscope North America George Rush
Gimme The Loot Sundance Selects North and Latin America Submarine Entertainment
The Tall Man Image Entertainment US CAA and  Loeb & Loeb August 31st
Elektrick Children Phase 4 North America Katharyn Howe and Paradigm
Blue Like Jazz Roadside US The Panda Fund $595,018
Crazy Eyes Strand US Irwin Rappaport $4,305
In Our Nature Cinedigm US Rights Preferred Content
Brooklyn Castle Sony Pictures Remake Rights Cinetic Media
Scott Rudin
The Central Park Effect HBO US TV Submarine Entertainment
Gayby Wolfe US The Film Collaborative
The Do Decca Pentathlon Fox Searchlight North America Submarine Entertainment $10,000
Red Flag Releasing
Fat Kids Rules The World Arc Entertainment North America Paradigm
Decoding Deepak Snag Films US N/A October
Big Easy Express Alliance Entertainmnet Worldwide DVD/VOD Paradigm and S2BN July 24th DVD/Blu-Ray
Big Easy Express S2bn Worldwide Itunes Paradigm and S2BN Available Now
The Last Fall Image Entertainment North America N/A
Pavillion Factory 25 Worldwide N/A Jan
Oscilloscope Labs
Frankie Go Boom Gravitas US Rights Reder & Feig and Elsa Ramo VOD Sept
 Variance Theatrical Oct
Dreams of a Life Strand releasing US Rights eone films international Aug 3rd

 

July 18th, 2012

Posted In: Distribution, Film Festivals, Theatrical

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TEN TIPS for FILMMAKERS

Going to Market or Seeking Distribution
Going to a festival / market such as Cannes is exciting. Wine is often cheaper than water. Almost anything you eat there tastes better than almost anything you’ll eat here, even though it is a tourist trap. Somehow, no matter how many carbs one eats, one usually still loses weight either because of the hustling and bustling or the fact that the French make their food lighter even when it’s rich and they don’t use preservatives when we do…. ahh France. But, I digress.

When searching for distribution at or in preparation for, a festival or market, be clear about your goal and the amount of responsibility you have to your investors. You should be conducting a lot of research before you ever hit the market floor to identify which companies will be a good fit for your film. Depending on your knowledge, experience, willingness to take responsibility and the type of film you have, it may be advantageous to sell your film on your own, or it may be better to use a sales agent. Much is entailed with selling a film in different territories and formats and if you do not have experience in doing so, you may be better off working with someone who does. I have some tips for you to follow regardless of how your film will be sold.  The Film Collaborative can help filmmakers who have decided to handle their own sales by evaluating contracts and guiding them through the process without taking the filmmakers rights, but it does depend on the filmmaker’s willingness to actively solicit buyers in the first place. Attracting suitable  buyers is a time consuming and costly process (travel, marketing, sales skills), so if you have no interest in doing this, it is better to delegate that work (and your rights) to a sales agent. Before signing on the dotted line with ANYONE, (sales agent or distributor) you will need:

1. REFERENCES: Get references, and then call or email the *other* filmmakers the company has worked with. I am only partly teasing. You should be able to find a list of current clients on their website and you can research contact details for those people. It’s great to contact the references actually given, but sometimes it gives a clearer picture to contact a few at random.  You’ll be shocked by how useful this can be to either comfort you that you are doing the right deal or protect you from being stuck in a deal you should not have done. The Film Collaborative has set up a Distributor ReportCard (a sort of “Yelp of Indie Film Distribution”) to help in the research of this.  Check out our Distripedia™ section on our website www.TheFilmCollaborative.org

2. CAP EXPENSES: Define and cap all recoupable expenses and evaluate those based on projections. Spending $30,000 –  $50,000 – $75,000 – $250,000  ++ is not inherently bad or good. It depends on the upside and the reasoning. Be clear about what the expenses are for, how much is approved, and if you and 8, 10, or 12 other people are being charged back for the exact same bill.  Let’s not let that happen. Are you paying for a party in Cannes? Maybe that is what is needed to attract buyers…just make sure that you are choosing to do so and that it makes sense. If the expenses are for distribution, have an idea about P&A budgets for different types of releases, the size of the release, the realistic projection of return and how long that return might take. The bigger the release (theatrical to many cities, large advertising spend, high cost publicists), the more expense is incurred and likely the longer it will take to recoup.  And one should have a clear sense of the objectives and projections of the theatrical so one can properly analyze expenses.

3. RIGHTS vs RIGHT TO SELL RIGHTS: Distinguish between the right to represent the rights (example, traditional sales agency could choose to do vs taking all rights) and vs having rights to actually directly distribute (example a sales agency that takes all rights so that it can also then directly do digital distribution or a buyer who buys multi territories but then has other companies do the distribution in most of them, or a company that does not do its own theatrical or its own digital or its own DVD.   Extra middlemen mean extra fees means less $$$ to you. You may want a company to have both and take care of it all for you and maybe it’s even the most advantageous deal because of relationships and best terms. Just know what the deal terms will be instead of realizing after the fact.  This is especially critical when fees and expenses come into play.  You may not want or need your sales agent to directly distribute to digital platforms if you can manage this yourself or they don’t end up even doing that in unsold territories but have your rights anyway, or maybe you do. And that brings me to another point about rights, don’t give any away that won’t be “exploited” as they say in the industry (that’s meant to be a nice thing).   I.e. have rights revert back to you that are not properly handled and try to not give them away in the first place without knowing why it makes sense to.  And I always like to carve out digital platforms a filmmaker can get onto that a sales agent or distributor does not want or choose to (in collaboration with the distributor or sales agent of course).

4.  ACCOUNTING: Make sure you know when Accounting is due and when your corresponding payment is due.  Try for QUARTERLY unless you don’t like money coming in at least 3 times a year since most will pay no sooner than 30 or 60 days after the end of the quarter.  Semi-annual accounting is possibly acceptable later into a term if you have no choice.

5. AUDITING & ARBITRATION: Reasonable Auditing and Arbitration provisions are key so you can have a clear way of investigating.  Know where the arbitration will be conducted. “Resolving a matter via arbitration may be less expensive and more expedient than having to sue the distributor, but an arbitration provision may also be less effective at encouraging the parties to compromise prior to invoking arbitration than the threat of a lawsuit,” says TFC’s legal counsel Cherie Song, an attorney at McGuireWoods LLP.  Also, “a distributor should have an obligation to maintain records of all sales and rentals of the film, and give you the right to inspect such records at reasonable hours with prior notice,” she says.  “If your audit finds an underpayment, the distributor should pay you the difference within 30 days of demand, and if the difference is more than 5%, the distributor should reimburse you for your auditing costs.”

6. TERMINATION: Also set parameters by which a deal can be terminated. Not suggesting this should be random and exploitive of the sales agents or distributor’s efforts, but should they be in breach or become insolvent, one needs a remedy if it’s not cured.  “If the distributor fails to fulfill a material obligation (e.g., if the distributor fails to pay the MG or your share of “Gross Receipts”, fails to provide statements or fails to market or distribute the film within a certain time period following complete delivery) or files for bankruptcy, then you should have the right to terminate the agreement with notice, with the rights to the film in unsold territories immediately reverting to you,” Cherie recommends.  “The distributor should also indemnify you for claims resulting from its breach of the agreement and violation of third party rights. Furthermore, the distributor’s payment and indemnity obligations should survive the expiration or earlier termination of the agreement.”  And our capitalizing of “Gross Receipts” is on purpose.  All terms that have any possible key meaning and affect your deal should be capitalized and DEFINED!  Many thanks to Cherie for her impeccable services to our filmmakers overall.

7. MARKETING PLAN:  In order to distinguish a knowledgeable and reputable distributor from one who is less so, ask for a detailed marketing plan. For filmmakers to be in the strongest negotiating positions on this, a marketing plan should have already been developed and implemented during production and a fan base already started. The distributor will simply be adding extra muscle to this plan, both in terms of financing and staff. If there is no previous plan, ask to see exact specifics on how the title will be handled in-house and the expenses associated with it before agreeing to a contract. This is of utmost importance as the success of your title depends on these efforts. Without a clear understanding of the strategy, you may find your title simply becomes part of a catalog passed along during markets or part of a library that is rarely exploited.  The more effort a filmmaker makes in gathering an identifiable audience for their work, the more leverage he/she has because the film has provable potential.
8.  BUILDING AN AUDIENCE YOURSELF: Intentionally putting a fine point on this topic! More and more distributors and sales agents are researching your title just as much as you are researching them. If you haven’t made any effort to build an audience, the perception is maybe there isn’t one. You should be looking at the sales agent/distributor relationship as a partnership not as a savior. This makes your film far more attractive to those companies because they can see the money making potential and their efforts will make the title a much stronger earner.    Wouldn’t you want to have an edge up on getting a better deal or not even needing one if you had already built an audience around your film well in advance of your first premiere? I know I would. (And thanks to our social network marketing guru / strategist Sheri Candler who contributed to this blog and especially #7 & #8).

9. CARVE OUT SOME DIY:  Whenever possible, carve out the ability to sell off your own site and also via your own social networking pages and via other key DIY platforms & solutions.  We recently did a blog (April 2011) about these so feel free to check out that info via the TFC site.
10. SPLIT RIGHTS / BE AS DIRECT AS POSSIBLE:  If there is one thing I cannot stand is big fees taken out for being in the middle of revenue and not doing much to justify the fee.  If a distributor is direct to key retailers and key digital platforms and is doing all or most of the release directly great. But if a distributor is licensing your rights for a not-very-huge-fee and hiring someone else to do the theatrical (and recouping an extra fee expenses) and / or not direct with libraries and institutions (if relevant) and/or not direct with key retailers or digital platforms then why bother? Go direct. Be as direct as possible.  Split rights as much as possible especially when there is little investment on the MG side and/or little theatrical P&A side that help justify the rights needed for recoupment.

In closing, I will again emphasize research, research, research.  Don’t be lazy and then regret later. It may have been more difficult to do this as an average filmmaker previously, but it isn’t difficult now. Take responsibility for your work and the business of it.  Ask around.  Ask other filmmakers, other companies, Ask us. Ask at least 3 people any given question so you can get a sense of the real answer to the extent there is one.

 

Bonne Chance!

 

May 6th, 2011

Posted In: Distribution, Distributor ReportCard, Film Festivals, International Sales, Marketing, Theatrical, Uncategorized

* This is part 1 of 3 parts to this Sundance focused blog.

* Part 2 will be written during the festival.

* Part 3 will be written in the aftermath of the glow of the fest.

If I were a filmmaker going to Sundance, and let’s say that I had a film with no recognizable press-generating cast that would be attractive to a distribution company for a large MG… What would I do? Seriously, I asked myself that question. And I realized how tempted I would be, even I, to find some sexy publicists and rockstar agents or sales company so that I could get the hot sexy sale at Sundance and make all my dreams come true.

What can a distributor do for you that you cannot do yourself with just a little bit of money, not even a lot, and some low fee consultation? And above all, what are you giving up by not building community for your film before and during the fest, instead letting other people run your show, potentially losing out on the momentum of the festival?

The beauty of Sundance, aside from the pretty mountains and clean air and great films and the best cheese danish I have ever had (@ the Java Cow and I know I’ll regret writing this), is the focused attention of both the PRESS and the PUBLIC. Most films showing at the festival, excluding cast-driven films, would not get half (½) the attention would they were not showing at Sundance.

Let’s look at some films from Sundance last year that were in this position and the routes they took and what they may have netted. These are films that cut distribution deals of some kind and got less than wide releases from their distributors:

A Small Act (Doc): Distributed by HBO, I don’t know exact sale price but suspect it was less than $150,000 and they did not need a sales agent to do that.  They are also a TFC client for festival distribution. TFC handled film festivals for the filmmaker though by the time we got involved HBO had aired the film and that hurt our festival bookings and hence diminished potential revenues to the filmmaker. The director, Jennifer Arnold, is presently closing a DVD deal as well that she got herself.

*Gasland (Doc): Distributed by HBO, TFC consulted at Sundance along with their lawyer Michael Donaldson, and they did not need anyone to help them get a good HBO deal though they did have help handling offers and pursuing interest. The deal came to them directly and would have come to them regardless.  They did some self-distribution for theatrical (Box office $30,846) and festivals. The film is now available for DVD.  Zipline did PR and the film got its good rightful share of it.  The filmmakers received a deal that has worked out very well, with some great PR and it played lots of fests. It’s shortlisted for the Oscars too.

*Extenuating circumstances: Debra Winger executive produced this film and she definitely helped a lot. Josh Fox is a very committed activist and spokesperson of the film’s critical message so he is very embedded in the community that would be most interested in this film. It’s a great example of a film that got a lot out of being at Sundance and the filmmakers got a deal they are happy with and they probably recouped as a result given the low budget of the film.

A Film Unfinished:  Distributed by Oscilloscope. I will say that $320,000 theatrical box office is very very good (I have no idea what they spent though to release the film but it’s likely some money was made on the theatrical). The film had a sales agent (CINEPHIL from Israel) and I am almost positive the MG was less than 6-figures. My judgment is that the filmmakers could have done just as well releasing on their own with just some money set aside for a booking agent and a publicist, especially for this niche.  It is a doc that hits a niche audience that works consistently and is lucrative and I can’t say that the filmmakers needed a sales agent and a distributor to be in between the film and its audience. I doubt the filmmakers will make as much money as they would have handling the film on their own with just some low fee consultation.

The Dry Land – reported budget from imdb $1mil, box office  $11,777 Most likely a service deal since it was theatrically released by Freestyle Releasing. Freestyle service deals are not cheap; most of their releases involve budgets of $200,000 + (though sometimes less) and most for-profit service deals involve fees of tens of thousands of dollars). Clearly not a good result here, but we assume hoping to recoup in home video.

Douchebag -Paladin is distributor and (so I assumed it was a service deal paid for by the filmmakers but the producer wrote to Ted Hope that they sold the film for more than its budget. We would love to know the details since usually Paladin does service deals and since to us that seems like quite a deal). Box office return $20,615 on a maximum of 6 screens. Also, not a good return.

Bhutto – Distributed by First Run Features. Just released December 3, to day box office $16,216, only playing 2 theaters. A large advance was not paid and most of what was accomplished could have been done by the filmmakers themselves without large percentages paid.

Taqwacores: Distributed by Strand , most likely a very small advance was given. The box office was $9,347 on 2 screens. Another example of a film that could have done this much better and faired better overall without a distributor involved. With just some low fee consultation, time and money set aside, the filmmaker would still be in control of their film and able to work up the audience.

I am not knocking these deals, simply noting that if one is to do them, one should at least cut out excess middle men and do them smartly, reserve some rights, negotiate carefully on the back end, monitor expenses, maybe even have been better off not doing these deals.  It would have helped all of these films to build community around the film leading up to the festival and exit the festival with a bang, ready to reach audiences immediately. I think a lot can get lost during the time it takes for distributors to bring films to market, especially for the smaller films.

I think the decision to cut a deal with a distributor, no matter what, is emotional because even when I put myself in the filmmakers’ shoes I realized the emotional power of having an offer made to just take care of this for me. It signals that what has been made must have value and was done well. It also allows for one to not have to get hands dirty with the money stuff and the business stuff. But, if you are a filmmaker, you did choose the most expensive art medium in the world and unless you are rich or your investors don’t care about getting their money back, I want you to at least consider this: You don’t NEED traditional distribution. For MOST of you, without special connections or name cast, MOST traditional distribution will not serve you. Most distributors don’t pay enough or do enough or are fair enough, and many of them have to raise P&A anyway, or hire the same service providers you can, so do the math, think twice, and be careful.  And remember, buyers are happy to buy direct, especially many TV buyers and VOD platforms, and you can get inexpensive help negotiating.

The more you can set up to do on your own the better for you and your investors in the long run. You run a risk doing nothing in terms of building community around your film or not setting up a distribution plan, having several layers of middle-men and waiting for Godot.  When you do the math, the Sundance dream often connects up to cast-driven films and just a few rare gems each year, and there are those to be sure, each year, but just a very few.  Most other deals you could get anyway if you wanted them, with someone on the side advising in you in fair way.

PS: Here is additional info on films from Sundance 2010:

* 3 BACKYARDS: Screen Media all rights, no verifiable release.

*12th AND DELAWARE: HBO Films, premiered on 8/02/10,currently HBO OnDemand.

* ANIMAL KINGDOM: Sony Pictures Classics, Box office $1,008,742 and this is a great example of a film that might otherwise have done little if any business were it not for Sundance.

* CATFISH: Rogue Pictures / Universal with a box office of $1,315,573 and it is definitely a great release for a doc and if the deal is good for the filmmakers then it’s a dream come true. Of course that’s an ‘If”.

* CASINO JACK AND THE UNITED STATES OF MONEY: Magnolia Pictures, $175,865 – and this is directed by Alex Gibney one of the most famous doc directors but sadly probably lost market share to the feature starring Kevin Spacey.

*EXIT THROUGH A GIFT SHOP: Producer’s Distribution Agency (a distribution company set up by John Sloss specifically to handle this film), Box office $3,291,250. I am in love with that film, and it’s to Banksy’s credit the film did what it did and some in the industry actually think it was a financially weak release given how much was spent, estimates are put at over a million. In any case, most filmmakers cannot imitate a set up that had John Sloss turn down a 7-figure advance because he wanted to handle the release himself and he did with the help of Richard Abramovitz and had the reputation and cult following of Banksy, Shepard Fairey , and Thierry Guetta.

*FAMILY AFFAIR: OWN the Oprah Winfrey Network, air-date:  possibly spring.

* THE FREEBIE: PHASE4, the box office was just  $16,613 the deal was allegedly worth low – mid six figures for US & Canada, all rights.  The film was sold by Visit films.) Now I have inspired Phase4 to buy two films I did not take a commission on.  I am not saying Visit films is not great and I am not saying it’s not great to have guidance at a festival or market especially when there is a bidding war, which there was apparently, I am just saying buyers buy films they want, not because of who is selling them.  We hope the filmmakers of all these films weigh in on their overages and overall bottom line.

* FREEDOM RIDERS: PBS with an outreach campaign by American Experience, film to be shown in May on 50th anniversary of the original rides.

*GROWN UP MOVIE STAR, NO US or INTL distribution, E1 entertainment is the sales agent, Mongrel Media (distributor in Canada)

* HESHER: NewMarket, reported budget $7mil, no release info

* HAPPYTHANKYOUMOREPLEASE (DISTRIB: Anchor Bay, release was supposed to be in March but as far as we know it has not happened yet).

* THE IMPERIALISTS ARE STILL ALIVE: no info

*JEAN-MICHEL BASQUIAT: The Radiant Child (Arthouse Films (which also produced the film), Box office was $250,129. A big hit in France, what a great niche and great doc. The producers did handle their film themselves in the US.

*LAST TRAIN HOME, Zeitgeist Films, released: 9/03/10-TOTAL GROSS: $282,092

(Here is a good example of a good doc sales company from what we hear and a good US distributor and a doc that probably sold well relatively speaking).

* LOVERS OF HATE: IFC –which is primarily a VOD play and some very traditional deal terms.

* MY PERESTROIKA: no info

* THE OATH: Zeitgeist, box office $42,273

* OBSELIDIA-reported budget $500K, still with a sales agent it appears

*THE RED CHAPEL, Lorber Films, opens 12/19/10 at IFC Center, Lorber Films plans a theatrical release of the film in the U.S. and Canada, followed by television broadcast and a DVD release.

* RESTREPO (US distribution: National Geographic Entertainment, Box office $1,330,058 –another Sundance success story to be sure, assuming terms are good for the filmmakers, which we have no information about

* SYMPATHY FOR DELICIOUS: Maya Entertainment (US, media)

* SKATELAND: Freestyle Releasing in March 2011 – and this means most likely it’s a service deal and paid for by the filmmaker. I should note that sometimes Freestyle helps raise the P&A. (though I don’t know what their cut is; one day I will ask).

* TWELVE: DISTRIBUTOR is Hannover House and the box office gross was $183,920 (somewhat shocking given the cast and the director.

*UNDERTOW: (Sundance World Cinema Audience Award Winner) TFC is doing theatrical and worldwide festivals and consulted on the distribution deals. We will be covering this in a case study to be written after the release is completed.

*WASTE LAND, Arthouse Films, released 10/29/10-TOTAL GROSS: $96, 597

Arthouse Films handled the theatrical release later followed by a DVD and digital release on the Arthouse Films label in early 2011…E1 Entertainment holds the international rights and is managing worldwide sales which to date include Australia (Hopscotch), Hagi Film (Poland) and Midas Filmes (Portugal). E1 Entertainment will also distribute the movie in Canada and the UK. Downtown Filmes is the Brazilian distributor.

* WINTER’S BONE: Roadside Attractions, Box office $6,210,516, and this is a great example of a film that would have likely lingered in oblivion were it not for Sundance and the right distributor;

* Other films not listed in detail are Cyrus, The Kids Are Alright, Waiting For Superman, Splice, and The Runaways because they all have big names involved, in a few cases the deals were done before Sundance and not all of them even had great releases in the net analysis.

December 21st, 2010

Posted In: Distribution, Film Festivals, Theatrical, Uncategorized

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Discerning the difference between a film that can actually sell well enough to justify having a third party sales agent and going to markets vs a film that is best served by DIY methods that should be planned and employed BEFORE the film’s first exhibition”

We get questioned all the time by members and others about which markets should filmmakers attend and which sales agents should they go with. Having unrealistic expectations is dangerous. It sets people up to do nothing on their own but wait for some third party to make their dreams come true.

We’re just coming off of AFM. indieWIRE reports growth attendance at the market. See this article

http://www.indiewire.com/article/2010_american_film_market_wraps_with_positive_numbers/# if you want to read the stats. They are however only relative to last year, a real low, and not addressing the question on everyone’s mind, what about the sales themselves.  AFM has always been known more for genre films and cast-driven films. Troma films do well for the genre category and Henry’s Crime starring Keanu Reeves, James Caan and Vera Farmiga is a cast driven narrative being sold this year, for example.

It was decently busy from my p.o.v and buyers were there a bit more to buy than they were at say Toronto, according to our foreign sales partner, Ariel Veneziano of Re-Creation Media. But, the question is what are they there to buy and at what price?  The shift in the business from the 80’s and 90’s till now is not reversing itself and I don’t think it ever will. Prices have come down, dramatically because ancillary business has shifted so much, retailers have gone under, and supply has grown. That is the case across the board.

Digital services such as Fluent, Gravitas, Distribber, Brainstorm (all of whom we work with) were all at AFM, digital is where the business is now, not in getting big MGs per territory for most films anymore, not for most art house films. Of course there is some of that business still but the people benefiting from it are the Sales Companies with big libraries and the aggregators with the same. The individual sales prices, after expenses are deducted, are more often than not, not making money for the filmmakers,  not given the terms most companies offer, at least not from our vantage point, . Of course we’re not in the business of selling big genre films or cast-driven films so we are not addressing those. Docs do sell best to TV at doc markets such as Hot Docs and IDFA, to name two, and those so far still seem to be worth it and that business still has value.  And of course a lucky few theatrical-potential docs sell at Sundance and TIFF etc.

Why do I bring this up? Because we get questioned all the time by members and others about which markets should filmmakers attend and which sales agents should they go with and the truth is, very often the films are not viable for a sales agent because the sales would be too small and if a sales agent did take the film on, the filmmaker would never see a dime after the sales agents recouped their expenses and fees and after one has paid for Delivery. And then the sales agent  / sales company would have the right to do the DIGITAL DISTRIBUTION DIRECTLY that the FILMMAKER SHOULD BE DOING. That is the point of this blog.  Discerning the difference between a film that can actually sell well enough to justify having a third party sales agent and going to markets vs a film that is best served by DIY methods that should be planned and employed BEFORE the film’s first exhibition.

Stacey Parks of Film Specific www.FilmSpecific.com recently sent this missive out to her members: “So AFM is coming to a close and the overall good news for everyone out there is that business is picking up from last year. Sales are brisk and even Pre-Sales are brisk for the right projects. I’ve met with several clients who are here at AFM and all of them are reporting good results in meeting a variety of people and companies as potential financiers for their projects, or sellers, or both.”

That’s exciting and we know Stacey knows her stuff and she’s a friend so all good. But I still want to know the numbers from everyone who sold a film, or didn’t after spending money trying, and ask all of you readers to share the real numbers, as we will of course (you will soon see), so that people can know what expectations are reasonable and what is not reasonable to expect.

Having unrealistic expectations is dangerous. It sets people up to do nothing on their own but wait for some third party to make their dreams come true. And then time goes by, months and even years, and one has done anything to build community around the film or get it out there. Then filmmakers are disappointed and blame others instead of making it happen for themselves.  There is no excuse for that anymore.

We announced a partnership with Palm Springs International Film Festival to help its filmmakers distribute and we will be working with other film festivals to do the same. Filmmakers are embracing Jon Reiss and Sheri Candler’s PMD concept and that can really create success via DIY distribution or get an audience started to give leverage in negotiating a deal.  The options for accessing Cable VOD and digital platform distribution and also having mobile Apps distribute the film are only growing, though of course the space gets only more glutted too.

But solutions are being worked out for that. Companies such as Gravitas are working with Cable operators vigorously to better program and highlight various categories of cinema, making it easier for audiences to find what they might be looking for. Comcast debuted a VOD search feature that imitates Google’s, and this will help in time: http://www.multichannel.com/article/459677-Comcast_Debuts_VOD_Sear

Verizon introduced Flex view to help consumers manage content on all their devices and all the players involved in digital are competing with each other to get as much good content to consumers in the most useful and user-friendly way to grow that market further, so whilst the space gets more glutted, there are more solutions in play to manage the paradox of choice a bit better and that’s why it’s imperative that filmmakers get engaged with their own success more and more, and sooner and sooner.  Lastly, these days, aggregators such as Cinetic and many distributors openly rely on filmmakers to do a lot of their own community building and marketing so if you are already doing the work, you might as well keep your rights.

Again, we do sales ourselves, we know there is still value in that, but we implore you filmmakers to do the research before you give up the rights and before you just forge forward trying to figure out which market to attend or having organizations like us do that for you, for many many films, there is no market you can attend that will be worth your while. Create your own market that will pay off in the long run.

November 11th, 2010

Posted In: Digital Distribution, Distribution Platforms, DIY, International Sales, Long Tail & Glut of Content

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