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October 3 at 8:30am

Independent Distribution In America Is Seriously Threatened

By Ted Hope

And the reason is because independent exhibition is even more seriously threatened.  This is likely the last year of 35mm projection and the problem of that goes much deeper than whether you appreciate grain or not.

Sure the promise of digital projection & delivery is partially lower costs, but the cost of conversion is out of reach of many small exhibitors.  The funding scheme that many theater chains have utilized, instituting in a Virtual Print Fee (VPF), puts the financial return in jeopardy for indie films — we could not play DARK HORSE in theaters that required a VPF because after the film rental split, another $800 in VPF risks having us not just not make money, but lose money.

The studios all require the theaters to be DCI compliant.  The cost of being so is out of reach for smaller theaters.  Yet, the studio, and their specialized subsidiaries, represent such a large share of the box office, theater owners have to consider this move.  But if distributors don’t want to lose that $800 that goes to the VPF, can the same theater offer projection on one of the many cheaper systems.  Why not?  Because evidently the MPAA went to The Supreme Court and got them to approve an exception to the anti-trust laws and require all the theaters to sign a no-compete clause and use just a single platform.  This sucks and is not what I expect from a country that prides itself on being the “Land Of Opportunity”.  

A former intern of mine, Ricky Camilleri, hosted a great conversation on this topic on HuffPostLive.  His guests include

Here it is that discussion non-live.


Two further notes: I have to say I really like this style of Google HangOut forum for discussion, particularly with the added in comments and questions from the audience/community.  It feels very participatory.
I wanted to title this “Independent EXHIBITION In America Is Seriously Threatened” but I suspect that “Distribution” will make more folks read this post.  More and more as I look at what is the lifeblood of independent cinema culture I come to exhibition.  They should be are heroes.  The industry and culture needs to celebrate them far more than we do.  The era of the filmmaker/exhibitor collaboration should already be here — but it’s not.  Shall we try to fix that too?

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  1. Michael R. Barnard / Oct 3 at 8:30am


    Three years ago, I floated a concept I called “Best Seen in Theaters” to promote exhibitors. That died in protests by gurus and filmmakers who proclaimed online distribution as the future and the only process to be promoted. Nobody got on the bandwagon to support theatrical exhibition.

    It was solely the indie-arati who attacked the “Best Seen in Theaters” meme. I did not sense that it was the audience that was turning its back on exhibitors (yes, I know attendance is declining and there many arguments about why) although, tellingly, nobody who’d be considered “audience” embraced the concept.

    There is no question that online distribution is easier and has a lower barrier-to-entry, but I don’t think ease of entry is the most valid reason to eschew exhibition.

    In my experience among the vocal filmmakers and gurus, as you note, exhibitors are not considered to be our heroes. There is even animosity towards them as dinosaurs, particularly among up-and-coming filmmakers who are not compelled by ROI.

  2. milesmaker / Oct 3 at 8:30am

    It’s a grim reality indeed for exhibition right here in America, yet the more I learn about this business of movies the wider my eyes are open to international audiences beyond our continental view. The studios are currently raking in 70% or more of their earnings from international sales, and indies need to be just as opportunistic. Yes, challenges abound, but the potential is tremendous–the window of opportunity is open. I’ll venture to say avenues for exhibition will be just as narrow if not more, but our primary objective is to maximize ALL revenue streams for our films to offset the trickle in from sources we used to rely on for ROI.

  3. squaredog / Oct 3 at 8:30am

    What about Tugg.com? We’re exhibiting our movie through that and it allows us to show it in theaters that we wouldn’t have dreamed of showing it in without the service. And you can’t do a screening though it that isn’t profitable. If you don’t promote and get enough people to buy tickets then it’s cancelled and that’s on the producer.

  4. Brian Briskey / Oct 3 at 8:30am

    Michael, please share with me those filmmakers who see online distribution as the future….

    I have nothing but barriers of ego and disdain as I approach that area of business. Even when speaking to investors, while I present an online marketing model for film that promises great reward with theatrical release as a marketing expense (not intended for revenue) I am rebuked for not packaging “all rights” foreign sales as the primary revenue source… a model which is ironically driven by named talent and egregious marketing waste on wide theatrical release.
    Appreciation of a theatrical experience is best for the “experience” such as the model of Drafthouse Cinema by Tim League. His audience is a curated crowd of regulars who attend the occasional blockbuster hit (it introduces new people to the theater chain) but the real product and experience is the special edited content like 70′s Kung-Foo mash-ups or Master Pancake Theater (it’s a mystery science theater variation).
    If your content does not fit the “brand” of content for Drafthouse then use the Tugg platform. If you really want top revenue go cable PPV. I you want the safest strategy on a drip marketing campaign go online… which includes the overseas markets (just not the cable and theatrical distribution).
    Does that solve concerns by both the theatrical proponents and the online proponents?

  5. smalltown / Oct 3 at 8:30am

    We have a small single screen theater in Canada which has been in operation for 60 years.
    The present owners have had this theater for 42 years but will be forced to close in the coming year. The folks in this community will have to drive one and a half hours one way
    to see a movie when we close. A sad day for the small town theater owners.

  6. FollowMyFilm / Oct 3 at 8:30am

    Wow, this is incredibly sad to me….

  7. FollowMyFilm / Oct 3 at 8:30am

    Does a Tugg screening require the VPF? How does all that come into the picture?

  8. FollowMyFilm / Oct 3 at 8:30am

    “The era of the filmmaker/exhibitor collaboration should already be here — but it’s not. Shall we try to fix that too?”

    Yes – by all means! I’m not only an LA filmmaker, I am an LA-born filmmaker; however, even with indie exhibitors, there is very, very little relationship/encouragement to screen my films. You call the “independent theatre” and ask about a rental/screening, and you get the canned answer with canned fees. It’s not very encouraging. I’ve always said that a local screening of a local film is most likely going to be profitable because those filmmakers are going to bring their friends and family to the screening.

    It would be great to see more mechanisms in place by indie exhibitors to encourage screenings of local films. Even if some kind of “submission” system similar to festivals (but definitely without the fee!).

  9. squaredog / Oct 3 at 8:30am

    No VPF. the only cost is a one time fee for the producer of something like $800 to get the film transferred to DCP and in to the Tugg system. It doesn’t cost anyone anything after that.

  10. Salon in Surat / Oct 3 at 8:30am

    This one is a lovely post in this website.
    Be polite when you talk with some one.

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