Once a film is completed, its greatest challenge awaits: how to stand above all the competing movies, entertainment offerings, and all the media and advertising images and sounds that bombard us like a perpetual cable news channel, 24/7.
If the movie that’s just finished is a studio film, then it already has a slot on the release schedule, trailers and TV spots that have been prepared, an electronic press kit (EPK) and publicity kit with still photographs and digital images, and various executives assigned to its marketing, ad buys, bookings and accounting.
For everyone else, it’s back to the basic strategies outlined in the class regarding seeking financing. There is an organized way of doing this that has been outlined in length by entertainment attorney John W. Cones, in several books he has written. What’s realistic about Cones’s approach is that it does not depend on the “who do you know” or “who do they know” method, but rather on organization and legwork.
It also requires access to a database that would have a current list of all feature film distributors on the West and East coasts, and contact information for them. Once that is gained, Cones advises immediately eliminating the distributors one knows will not be interested in the movie because they are too big or too little, they are not preferred by the filmmakers, or they are known for handling certain kinds of movies, and this one doesn’t fit that image.
The producer may select 5-10 distributors that seem like best bets and do more intensive research on this limited group, particularly in terms of their track record with similar films. This means developing a further list of all the films they released in the last five years, looking at the marketing and publicity campaigns they mounted for those films, and the box office performance of each such film.
Then a judgment has to be made on which distributors to approach and how best to do so. Cones suggests preparing a producer’s package for presentation to distributors that includes the title report, copyright search report, chain of title documents including the certificate of authorship for the screenplay, the music, the final screenplay and shooting script, cast and production credits, a synopsis of the script, biographies of the key people, production stills, all legal agreements and the errors and omissions (E&O) certificate of insurance.
The producer wants to be sure that the distributor is willing and capable to contribute to the cost of prints and advertising (P&A), and wants to know what competing films it might also be planning to release. If possible, the producer also wants to collect an advance or guarantee against future receipts. More detailed considerations, such as cross-collaterization of one project’s revenues with another producer’s film, are best left to attorneys to negotiate.
The guaranteed marketing and advertising commitment are the most important issues, and must be nailed down well in advance of the movie’s release. The distributor’s fees also must be specified, in each territory and market if applicable to the deal, and a clear understanding of when those fees will be taken. Even questions of what MPAA rating would be unacceptable to the distributor must be raised and resolved in advance.
The terms of most films booked into theaters are usually negotiated by the releasing company and the theaters, typically with 90% of the box office receipts, minus the house operating expenses, going to the distributor, with that figure tapering to a 35% minimum in succeeding weeks.
Of that 90%, the distributor commonly takes a 30-35% distribution fee in the theatrical marketplace, and even higher fees for “distributing” the film on home video and video on demand. So it is in every distributor’s best interests to have the largest opening weekend numbers possible, not only because it establishes the reputation and bona fides of the film and distributor (and certainly benefits the producer and director and everyone else associated with the film, too), but because it makes the most money in those first weeks of release.
There are several distribution strategies that can be employed in a film’s release, including the wide saturation release (3,000 screens or more); a slow release (300-500 theaters initially, and then growing weekly); and a limited release, which is pretty much confined to art film releases. Traditionally Friday opens a movie run, although Wednesdays sometimes are used to get a jump on other films.
Where a film turns up on a distributor’s release calendar has everything to do with the competition, whether that is within the studio or distribution company itself, or within the marketplace. The most desired slots are obviously reserved for the potential blockbuster or “tent pole” movies that are the economic lifeblood for the studio and must cover the losses of all the films that don’t succeed at the box office. They traditionally get the most coveted release dates: Thanksgiving, the Christmas to New Year period, Easter, President’s Day and the Memorial Day Weekends, and post-July 4 summer period that dies abruptly just after Labor Day in early September.
The studios incessantly jockey for starting positions, and films that have big potential at certain times of the year will stake out their dates a year in advance, or more. Lesser movies use these pivotal weekends as reference points and finesse the slots around them, avoiding head to head confrontations with rival distributors whenever possible.
Opening dates are essential to meet once they have been fixed. A film like Titanic may recover from having its dates moved to finish its visual effects, but most films lose their momentum if they lose their initial release slot. Box office success on the opening weekend is deemed essential in this high stakes world of movie distribution.
The pressure to be #1 weekend after weekend pushes studios to fever pitch levels of anxiety. Media outlets stand in wait for the opening weekend figures. Two competing outlets exist just for the privilege of announcing and analyzing this data, Entertainment Data and Exhibitor Relations.
Generally, art films are distributed in the slow periods of the theatrical exhibition year: the fall period after Labor Day and prior to Thanksgiving; the period immediately following New Year’s and continuing up until Easter; and much of the period preceding Memorial Day, although lately bigger and bigger movies have been spreading into these formerly fallow fall and spring periods.
Art films can also competitively counter-program at the right time, as Michael Moore demonstrated when Fahrenheit 911 became a big hit in the middle of the summer, hardly the anticipated period for a political documentary to find box office success.
These periods are completely reversed outside North America, where summer attendance is traditionally low, and different holidays offer different opening opportunities. These matter significantly, because the globalization of film means that the international box office has primacy over its American progenitor, producing almost 75% of gross revenues for major studio movies. Movies are now released almost simultaneously all over the world to capitalize on global media attention.
While the U.S. domestic market for films seems largely saturated, with minimal ticket growth year to year, markets in China, India, Indonesia and Russia are just beginning to take off in terms of paying increasing ticket prices for primarily American movie fare. The proliferation of multiplex movie houses throughout western and eastern Europe and Russia will only accelerate this rapid growth.
Most major studios will not consider making a large budget film unless it has strong overseas potential, and as noted earlier, studios are also stepping up local production activities in markets where they have strong distribution networks. Today’s market realities have redefined the demographics to include international dimensions, which are specific to each territory.
Generally speaking, films with hi-tech action and heavy violence, strongly erotic themes and globally popular music are usually successful in the majority of non- North American markets. Entertainment tastes are also changing in these markets, which used to be more resistant to American style comedies; but films like Superbad and Knocked Up have been successful worldwide.
There is understandable cultural resistance globally to the Americanization of mass media, particularly cinema. Almost all foreign releases of American films are dubbed in the local language, and some cultures feel that their traditional moral and aesthetic values are threatened by the message Hollywood movies put out.
For independent distributors, the problems are different. Simply finding access to screens has become a problem, as exhibitors would rather have one successful film on four or five out of 15 or 20 screens rather than four less successful films. And since independent films rarely have large advertising and publicity budgets to attract an audience, the theater owner’s motivation to play these films is considerably lessened.
Smaller distributors must therefore deal with a more limited playing field of trusted exhibitors who specialize in independent and art films, and know how to appeal to the significantly sizeable movie audience that wants to see films that break away from the formula-driven offerings of the major studios. But independent distributors must be very selective in acquiring their films and cautious in their marketing campaigns, because there are almost no big blockbusters to cover the lesser performers’ losses.
It is a highly risky business, and sees the formation and dissolution of many companies in a quick period of time. Many of the specialty distributors are arms of major studios, the only way they can survive in this heatedly competitive independent film marketplace.
The Bottom Line
More than 3,500 films are made annually around the world, with more than 2,000 of those made in the United States. Almost every country makes films. But the vast majority of those movies will never be distributed to North American theaters, and not only the foreign language films. Most independent films are never acquired, and lately many of those “festival favorites” purchased at Sundance or Toronto or other film festivals have languished on the shelf, too, even after commanding expensive purchase prices.
The high cost of successful movie distribution prohibits continued bad judgment, even if an initial gamble was taken.
The best strategy to pursue if a theatrical deal cannot be made is to try a direct-to-video, or direct to cable premiere sale. Since these outlets in effect compete with theatrical distributors by offering fresh material for a less expensive price than a theatrical movie ticket, they are most likely to be interested in a film they can debut.
Not getting a theatrical distribution deal no longer means the end of the world. The audience now has, for the first time, the opportunity to seek out and see a film purely on their own initiative. We have reached the point where we can watch whatever we want on demand, wherever we are, and on whatever device we are watching: private home movie theater, flat screen high definition TV, streaming on laptop, tablet, cell phone, etc.
The next best opportunity for a film to have a life without a theatrical opening is the film festival circuit.