Tuesday: Distribution conference part 1: "Limited and Specialty Releases"

American Film Market 2011 conference: unofficial notes
Nov 8, 2011 9 AM: Distribution Conference notes part 1, "Limited and Specialty Releases"
Notes by B. Hahne

The original blog location of these notes is: http://2011afm.blogspot.com
This is day 5 of a 5-day series.

Clarifications or pithy comments by the note-taker will generally appear in [square brackets like this].

These notes are copyright (c) 2011 by Bruce Hahne. Noncommercial, nonprofit redistribution and/or pointing people to the blog is permitted and encouraged.

Disclaimers: "Free notes, you get what you pay for!" There notes are a summary, not a transcript, and represent my best effort to capture the panel discussion plus Q&A. They also probably contain errors. I'm not in the film industry, nor am I affiliated with AFM / American Film Market or with any of the firms associated with the panelists.

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Moderator: Steve Gaydos, Executive Editor, Variety, who is "stuck in traffic" as of 9:27 AM.

Panel:

David Fenkel, President, Oscilloscope Labs, NY indep film distributor.
Susan Jackson, President + Co-Founder, Freestyle Releasing
Charlotte Mickie, Executive VP, Entertainment One
Tom Quinn, Co-President of New Label, The Weinstein Company

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[Panel starts out at 9:20 AM doing self-intros since the moderator isn't here.]

David: We want to control our accounting, programming, marketing, "beginning and end of the whole distribution process for filmmakers". We also have our own DVD label. Documentaries, foreign-language films. Find films we're passionate about and then try to figure out how to make money on those.

Susan: "Service theatrical company": producers come to us with P&A money - we're like a mini-studio. Just started Freestyle Digital Media., a service, which will complement their theatrical events with VOD.

Charlotte: Entertainment One distributes in Canada, AU, UK, US. Produce and sell for TV. Manufacture DVDs in Canada. What I do is sell feature films internationally to distribution companies. Some docs. Genre films, arthouse films, larger films which have stars.

Tom: At Weinstein for 2 months. Co-president of a new label at Weinstein: multi-platform slate. Previously at Magnolia Pictures as SVP and Head of Acquisitions.

Charlotte: A filmmaker said "I'd really like people to SEE my film, can I just put it up on my website?" And I said no, you need a distributor and VOD deals. But for those of you on the panel, can you explain how the VOD thing works?

Tom: There's a misconception that VOD is magic and you just do it and money starts growing. Many VOD platforms - think of them as theater owners. What do you want from a theater owner? You want your poster out front, you want your trailer playing in the theater. You can put your film onto VOD but if nobody knows it's there, without promotion, it's amazingly invisible, nobody will find it. But if you do it correctly then you get access to 65M customers.

Charlotte: Do they need an agent?

Tom: They need to go through a gatekeeper. I do have friends who got their film onto iTunes themselves, low-cost things that cost them $50K, but it was a lot of work.

David: Lots of work to be done to exploit an iTunes release. Maybe you need college screenings or non-theatrical - get exposure elsewhere OFF of VOD and off of iTunes. If cast is low-end and you have no exposure, you don't want to just put it up on iTunes to see what happens. Invest in some sort of distribution platform.

Tom: Or name your film "Sex and Zen" like somebody did.

Susan: Still need to reach the consumer to let them know your film is available. But VOD can be more cost-effective.

[Panel moderator Steve Gaydos shows up]

Steve: Claim from a friend: "Overall business for independents is down by 75% compared to 5 years ago". Please comment.

Tom: Things have changed a lot multiple times in the past 5 years. In Magnolia our projections were off by 90% in some areas. We moved to day-and-date distribution to bring back the business. Last 10 years of box office in our space: number of films has doubled while the total number of indy films making a reasonable return had stayed flat, and while advertising costs had doubled. It wasn't working out well.

Steve: Lots of confusion about VOD numbers and what "VOD" is, even from experts. What drives VOD success?

Susan: Be earlier in the alphabet. [I.e. she means if the title starts with "A", I guess]

Tom: There can be a pop value based on title or cast, but playability does matter.

Steve: How do you define "playability"?

Tom: [People say] "I like the movie"

Susan: you can get good word of mouth on movies that are hard to market but very playable.

David: If you get your poster up on iTunes and have a strong 1-2 weeks then it feeds on itself.

Tom: Each online VOD store is different: Xbox vs. Comcast vs. etc. I agree there's not enough info, but in 2 years we'll probably have more data.

Charlotte: I have trouble finding distributors for various films that have played well at film festivals, particularly midwestern [she said "heartland"] festivals. Is VOD an opportunity here?

David: Hm, well maybe.

Steve: Is there good news in the industry?

David: In the indy business we can move faster, the studios are slower.

Tom: The independents are now taking over the space occupied by the middle, the mini-majors.

Steve: Somebody comes to you with a film that hasn't been part of a bidding war, and the film has value. What misconceptions do they bring with that film when they talk to you?

Susan: Usually it's that the cast is going to support the movie [i.e. that the cast is going to help you with publicity]. I'd say you should all put indentured servitude clauses into your contracts to make your cast help you market the movie.

Steve: Can you get word of mouth on films today?

David: Sure, but might not be theatrical. Sometimes that does happen, e.g. Black Swan.

Tom: You need to talk about age range. WOM I think of myself + my parents [older], "viral" I think a younger age range. If you can appeal to both audiences then that's where WOM and "viral" meet, e.g. Let the Right One In.

Steve: Can you only spot it in advance? I was at a midnight screening of Midnight in Paris and had a sense of WOM growing in that theater.

David: Sure we "sense" that a lot, but we're often wrong.

Steve: Are you seeing lessons from different countries as you distribute films?

Charlotte: US is far ahead of any other country we work with. VOD is nothing in Australia, very small in Europe, and in Canada there are some market restrictions about doing day-and-date. So non-US doesn't have much to say to the US side right now.

Steve: Any types of films that are doing better?

Charlotte: It's not the films that I have, but endeavor films: Formula 1 racing, boxing, ballet.

Steve: Small film doing a platform release in NY. What are the rules for a NY release?

David: We have films where we don't believe theatrical is a good idea. There are theatres in downtown NY which have cultivated their audience and if the film is a good fit then that's OK. But not always the right thing.

Susan: We have movies that we only release regionally and nobody in the "traditional" world would even know we released them - African-American, or faith-based, and we never go to NY for those. If you open in NY then you have to pay for a 4-wall which is expensive. But some of the output deals we have REQUIRE opening in NY.

Susan: If you pick up a film that's very marketable and you know that the NY Times is going to kill it in the reviews, then you don't go to NY.

Steve: What are your competitors doing that are good ideas?

Susan: Troll Hunter.

Steve: Why?

Tom: Very unique film, blockbuster in Norway, I saw it in Austin. Sold out around the world in 15 days just based on the trailer. Brought it to AFM and sold it out - Universal took a big piece. We had previously released Let the Right One In head-to-head with Twilight, which you'd think would be a stupid idea, but we know that every review of Twilight would also mention Let the Right One In. VOD and DVD don't always work out - we had a film do $5M box office and the VOD and DVD numbers are horrible.

Steve: Why is that?

Tom: Because my parents just figured out recently that you can rent DVDs via mail, and they don't understand VOD, but they know where the movie theater is.

Steve: So if your demographic is older, you put your energy where that demographic is. [duh]

Tom: And over 50% of that film's revenue was made in NY. So sometimes you go to NY for the revenue.

Susan: There are specialty movies, some do huge numbers on DVD, some do large box office.

Tom: My biggest DVD title last year was made for $50K, no stars, nobody has ever heard of it, my wife told me not to buy it because she hated it, and it addressed an audience that doesn't normally get a movie made for them.

Susan: We had one film do 4x on DVD what it did in the box office.

Charlotte: Winter's Bone, played in NY and in smaller markets.

Susan: That was a word of mouth situation.

Charlotte: How did the numbers play out?

David: $6M box office and then they got a bunch of Oscars.

Steve: How do you decide how much P&A to invest, $1M or $500K or whatever? How do you know when to "up your bet" and spend more on the marketing budget? Since these days $1M box office is considered good.

Susan: We have output deals that require certain numbers of screens and certain amounts of spend [so that sets a floor in many cases.]

Steve: OK well, are there still gamblers out there who will bet more on P&A spend?

David: We only take a small number of films for theatrical each year. Maybe 1 per quarter. At festivals our method is very simple, we look for the best film at the festival, and we hope it has a decent/known cast. We're looking for something we can get into Walmart.

Charlotte: There's still a market for westerns in the US

Susan: Yes, westerns still do well on DVD in the US. Not elsewhere, but yes in US.

Steve: Is there a consensus about what DVD sales are compared to what DVD sales used to be? Are we repeating the music industry story with album sales?

Susan: Bigger movies with names are still selling, A and A- stars.

Tom: For the smaller DVD title, that's a very dangerous business. But there's a good import genre business: Troll Hunter etc. Non-fiction smaller titles, art film, those are dying.

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Q&A

Q: I just finished a documentary, how can I contact people on the panel or people like you?

Tom: An intro is best. Or a succinct email that explains what you're doing.

David: We look at every film that goes to SxSW and Sundance.

Susan: I'm looking for very commercial films, not docs.

Q: What elements do you look for that help you to move the product?

Susan: The filmmakers partner with us in our case. We want the cast to show up [at events, showings] and do Q&A.

Q: Distribution with you folks AND the producer wanting to do self-distribution in smaller markets - can that work?

David: We don't do many split-rights deals like that. Harder for us to get behind a film when we're splitting up digital rights, or regions. If the filmmakers want to be part of the promotion process that's fine, like Buck had all these Fbook friends before the movie launched, and the filmmaker started that.

Q: I have a movie and we split the rights, international vs. domestic who is also handling VOD / online. We were warned against doing theatrical since it might screw us on TV.

Susan: That's French TV, that's your problem. It's about how likely it is that your film will want to air on French commercial TV.

Charlotte: In France they try to protect all the windows and there's a rule that says if the film is distributed theatrically in country of origin, then it MUST have a French theatrical release before it can go to French TV. Though there are some workarounds.

Susan: So it depends on your film - if unlikely to go onto French TV anyway then who cares.

Q: Most of us don't have Natalie Portman so we can't do Black Swan. For a pitch of a project, what elements do you care about?

David: We care about finished films. Most important thing is the trailer to us.

Charlotte: I do pick up scripts. I don't know how much a bunch of business analysis stuff surrounding a script will help me -- maybe for a niche demographic. But for international release I'm more concerned about the quality of the script. And I'd prefer if there's already a director on board, and I care about that director, and I care about the cast. I.e. I care about the creative elements not the business elements [at the script stage].

Q: I made a documentary and got into some boutique theaters and just signed with a NYC theater. Can I use this to talk to foreign markets now?

Charlotte: If the reason you did well in the US is US-centric then not necessarily. But it depends a lot on the movie.

Tom: If this was through Aaron Hill then you have a story right there.

Q: Re US DVDs. Filmmakers who don't get distribution, they go out on DVD, but Baker & Taylor and others won't deal with the indy filmmaker directly. They always send me to a particular aggregator, the same company, same guy at Victory Multimedia. [Nobody on the panel has heard of Victory Multimedia.] I did sign with them and I advise the audience not to. What would you recommend to indy filmmakers to get past these gatekeepers?

David: It's a tricky business. You need to choose a reputable company, like Image, DVD machines, that have relationships with Baker & Taylor etc.

Charlotte: E1 is in that business [that's her].

Q: Do US audiences like dubbed or subbed?

A: Dubbing sucks in US. For first window release, no.

Q: How often does the filmmaker bring their own P&A in deals with you?

Susan: That is my business, I'm a P&A investor.

David: We don't do that much though we're open to it.

Q: So the filmmaker doesn't have to bring that?

David: It's an advantage.

Tom: General idea is that for your $500K film, you should have $100K in that budget for P&A.

Steve: Exit strategy, is it good if the filmmaker has thought of this?

Susan: I'd be happy if the filmmaker just had some decent still photographs.

Charlotte: Or just get the deliverables right.

David: Look around the industry, unit publicity is really important yet very rare in indy film business. If you get ONE striking still photo from your film, Variety will run it.

Charlotte: About deliverables. For US vs. foreign these days you often end up making 2 different deliverables: DCP vs. HD. Expensive.

Steve: Is digital a win?

Tom: Yes, it's a win to not have to be on 35mm film. But... at festivals this makes it difficult to import 35mm - the US theaters are so upgraded that they can't play 35mm film now.

Susan: You have to decide if you're going to cut a 35mm version of the trailer, that's very expensive.

Steve: General advice is if you have any question or budget issues about your deliverables, you have a problem.

Susan: Music clearance is also a killer.

Q: Films successful in a certain market like W. Africa, has nothing to offer in the US, is that of interest to you on the panel?

Tom: That can be interesting to me, if it was very successful in its country of origin, but at the end of the day we do the same US analysis.

Q: Do you offer up-front fees when acquiring?

Tom: Yes.

David: About this, "Welcome to the Sticks" did very well in France, beat Titanic. IFC bought it but never released it in the US.

Tom: Why not?

Steve: It's really local. Local success. A lot of European filmmakers think "my film did really well in Holland, so now I'm going to get a lot of money!" and they're wrong.

David: We get pitched a lot of documentaries and my pet peeve is the pitch "there are 10M wrestlers in the US, if we get 1% of that market we'll make all this money!"

Tom: Right, that formulaic assumption. Bowling movie: we figured out too late that although there are a lot of bowlers in the US, they don't like documentaries.

Charlotte: This is back to the business plan - in some sports or hobbies nobody goes to see movies, and in others, everybody goes.

Q: What works within each genre? [That's not a distribution question].

Charlotte: Most of the people up here on the panel like sophisticated films, but stupid films can sell well too.

Tom: All of the films I've bought that turned out successful were films that nobody else was bidding on, so I don't know. Let the Right One In, nobody else wanted that yet it did really well. On the other hand I paid a lot of money for Signal, and that lost a lot of money.

Q: I have a western set in Germany, will that work?

Charlotte: If you have a great western it could work in Europe. And Germans like westerns.