Overseas Wrangling & Enticing Narratives – The 2009 American Film Market – Feature

The angle of the American Film Market always depends on the selling process in any given year. With this year’s inception, the influx of the economy continues to reflect within the buying and selling of entertainment. What this has done in many sectors is “lean and mean” the material being offered which inevitably makes the entire progression more efficient. With the aspect of Asian (and specifically Chinese investment) becoming more of a given, the keying of foreign investment and specifica talent utterly plays into the mix.

Films #1 The key in the angled process is looking what is debuting and offered in any given year. A progression of daily trades, film catalogue and the like tend to bring elements into focus. The titles begin with Alpine Pictures with their animated take in “Dorothy Of Oz” starring the voices of Dan Aykoyd and Kelsey Grammer. This time Dorothy returns to Oz to battle a character called Jester who uses the Wicked Witch Of The West’s magic wand to turn people in the kingdom into china dolls. American Cinema International brings two into the mix from director Michael Polish in the form of “Smell Of Success” (formerly called “Manure” when it played Sundance) which stars Billy Bob Thornton and Tea Leoni as the owner and sales rep of a manure company who must battle against a slick talking competitor (played by Kyle McLachlan) for control over the business. The second entry from Polish and ACI is “Stay Cool” starring Winona Ryder, Hillary Duff and Chevy Chase as a swirl of re-united love at a high school where youth battles against maturity. Following this, Archlight Films has two films in pre-production with “The All Of It” directed by Gilliam Armstrong and starring Liam Neeson about a priest forced to deal with an undeniable sin of one of his parishioners as well as “The Chase” directed by John McTiernan tells the story of Scalpel, a Lambourgini test driver who signs up for a heist that goes awry. Following with a reflexive eye is “Down & Dirty Pictures” from Celsius Entertainment. The film, currently in pre-production, which is to star Vincent D’Onofrio and Andy Serkis, is adapted from Peter Bart’s follow up to “Easy Riders, Raging Bulls” about the filmmaking wars of the early 90s, the rise of the Weinsteins as well as the age of Tarantino, Rodriguez and Sundance.

Panel: Selling Your Film Overseas As the transition from “Down & Dirty”, the true reflection in the industry becomes, with a changing landscape in terms of distribution in the States, how important the overseas sell makes to a film. The reality is that overseas can be more important than the US deal but securing one at times reflects the other because it shows the ability to appeal to a wide audience.

The key to the panel was to take a basic script that can be made for a price but taking into account the location and stars can be changed. In bringing it before the said diverse constituents, the question becomes how should one proceed in the global marketplace.

Tim O’Hair, packaging guru at Paradigm, begins with the initial questions: what elements do you have and what do you need in order to make your picture? The next question then becomes: how flexible can you be and what is equity involved? The key is knowing what your talent is worth in the marketplace. That dedicates a budget more than anything. The market is asking in its current inception for higher value at lower cost. The key is to piggyback as much as possible, he says. In terms of talent, think “manager” because they are always easier to get to than “agents”. The reality is that if the script is not good enough or of relevance to the star in passing the “sniff test” then it won’t go anywhere anyway.

Robert Katz, President Of Production at The Film Department, takes the ball bringing in real world examples saying that that when they were making “The Painted Veil”, starring Edward Norton and Naomi Watts in Asia, they received 10% of their budget from China (without whom they could not have made the movie). A majority of risk though, he agrees, comes from selling a picture foreign. The paradox is that if you can come upon North American distribution (which is becoming much rarer in this space), then your value abroad becomes that much more prevalent. The problem with local equity is that it runs the rein of becoming too specific.

Doug Hansen, financier for Endgame Entertainment, says that the specifics are the idea but ones needs to make sure to provide a balance. For example, he says, don’t make “Euro pudding” that doesn’t fit into the buy structure for any territory. The question becomes, for him, is how commercial is the project and can you define the audience. Try to secure distribution overseas multi-territory through companies like E1, Pathe & SMDM especially if the film has that kind of appeal (which, of course, is easier said than done). The reality of the production business also necessitates that fewer pictures are getting made. The maount of pictures being produced in the marketplace went from 400+ a year or so back to 180 currently. Their new film, “Hungry Rabbit Jumps”, starring Nicolas Cage, January Jones and Guy Pearce starts in December and is their first production this year which defines the caution being taken.

The reality within the market balances on how sales purely motivate the consumer. In terms of one of the top sales agent within the realm of the budget, there is $200,000 taken right off the top. 5% of the budget is the going market rate of the budget in an age where studios and companies are cutting back the bottom line. Add on to that, 8½% is dedicated to residuals. In this way, as stated, it is sometimes good to find an established producer to partner with in the endeavor

D’Arcy Conrique, finance consultant, says that sales agents now are working in the thought process of guarantee models. The problem, in general, he says, is that it is harder to get a completion bond in terms of budget estimates that make sense. He says that the market, in his mind, can still take indie films but, even with the setting up of new P&A funds around town, the projects have to be precise (which has always been the case).

The reality is that the game is changing but the project has to be that much more solid in terms of a proven property or angle that can be seen from beginning to end.

Films #2 Taking into account the arena discussed above in terms of making an independent while perceiving the market overseas. The arena, barely discussed here, which was a big thought at the IFTA Production Conference was the influence of China as a financing partner. The reality is that they want to make local based films which in turn screams against the element of a cross culturalism. For example, China Promotion Film International is bringing three films to the table. “Gun Of Mercy” tells the story of a Chinese prison guard who must try to save people when massive floods threaten their city. He leads a ragtag group of prisoners and civilians to safety while personalities clash and allegiances divide. “Moonlight” follows a married woman who escapes her life to visit the opera of a small village where she discovers a secret love story which defined her stepfather’s life. Again, the ideal of the film permeates the national consciousness. Lastly within China Promotion is “Weaving Girl” which follows a female struck down by terminal leukemia who leaves her husband to find her lost love feeling that no one cared for her. After realizing her folly, she realizes her husband had been working tirelessly to pay the medical bills to try to save her. Next, Content Film offers up “Ironclad” starring Paul Giamatti and James Purefoy (of “Rome” fame) which is described as a “Medieval Magnificent Seven” combining “the visceral stylized action of ‘300’ with the impassioned heroism and romance of ‘Braveheart’”. Over at Darclight Films, Russell Mulcahy who just enjoyed renewed career vitality due to “Resident Evil: Extinction” brings “Bait in 3D” which chronicles a sleepy coastal resort that is overcome by a freak tsunami that traps many inside a supermarket during a siege with an armed intruder. The reality is that the sea has brought in other predators in the vision of packs of hungry tiger sharks wandering the town.

Film #3 Again hailing from Edko Productions in Hong Kong, Jet Li stars in “Ocean Heaven” (currently in production) as a father who runs an aquarium who must care for his autistic 20 year old son. Essential Entertainment follows with the high concept “The Diplomat” set to star Kevin Costner and Paul Walker about a government official about to expose a traitor when his wife and daughter are taken hostage by the same man. Exclusive Film Distribution continues in this vein of family in trouble made very lucrative by the success of “Taken” with “The Resident” (now in prost production) starring Hillary Swank and Jeffrey Dean Morgan (of “Watchmen” fame) about a beautiful young doctor who moves into a stunning loft apartment in Brooklyn only to find that there is somebody watching her. GK Films, headed by former IEG topper Graham King, shows its continual intent with three films currently in post production. The first, “Edge Of Darkness”, starring Mel Gibson and directed by Martin Campbell (“Casino Royale”), follows a veteran homicide detective that investigates hisbown daughter’s murder which leads into a looking glass workd of corporate cover-ups and government collusion. Following that is “London Boulevard” directed by William Monahan (who wrote “The Departed) and starring Colin Farrell and Keira Knightley about a young South London criminal, newly released from prison who becomes involved with a reclusive young actress. Last but not least is “The Rum Diary”, taken from the pages of Hunter Thompson, starring Johnny Depp and Aaron Eckhart in a story of “initerant journalist Paul Kemp who travels to Puerto Rico to work for a local newspaper and soon becomes obsessed with the wildly attractive fiancee of a shady businessman.” Hannibal Pictures also has a variety of projects in current states of structure. “Bagman” (aka “Casino Jack”) directed by George Hickenlooper stars Kevin Spacey, Barry Pepper and Kelly Preston, in the true story of a hotshot Washington lobbyist and his protege who fall from grace when their schemes to peddle influence lead to corruption and murder. “Big Bang” (now in production) stars Antonio Banderas and Delroy Lindo about a gang of ruthless cops who kidnaps a tough investigator who tells a story of a Russan boxer, a missing stripper and a surfer looking for “The Big Bang”. Anything is possible. Lastly, “Son Of No One” (in pre-production) stars Channing Tatum, Robert DeNiro and Terrance Howard in the story of “a young cop assigned to a precinct in a working class neighborhood where an old secret threatens to destroy his life and family”

Film #4 Hyde Park Entertainment brings forth the long gestating “Machete” from director Robert Rodriguez and his long time editor Ethan Maniquis. The provided synopis, newly available, states “the script follows an ex-Mexican Federale, Machete, who is hiding out in Texas as a day laborer. Impressed by his hulking psysique, Machete is hired by a corrupt senator to do hatchet jobs. When Machete realizes that the corrupt politicians who hired him have set him up for their own personal gain, he vows to seek redemption for himself and his people”. Second on Hyde Park’s list is “The Unbound Captives” directed by actress Madeline Stowe (of “12 Monkeys” fame”) and starring Hugh Jackman, Rachel Weisz and Robert Pattinson in a story set in 1860 with America on the brink of civil war. The narrative follows “Tom, a white frontiersman raised Comanche and his love for May, whose son and daughter are kidnapped by Indians. Their parallel lives intersect as they battle through a vast and violent landscape”. Icon Entertainment, well regarded in vast circles, brings two diverse stories into play. “Oranges & Sunshine” (in pre-production) stars Emily Watson and Hugo Weaving (of “Matrix” fame) in the story of Margaret Humphreys, a social worker in Nottingham, who uncovered the forced migration of children from the UK to Australia and fought to bring thousands of families back to together by exposing a miscarriage of justice. Secondly for Icon, “The Tempest” (in post production), directed by Julie Taymor (of “Across The Universe”) and starring Helen Mirren, retells the classic Shakesperean tale, this time having the title magician take female form as Prospera takes vengeance on her foes giving this age-old tale a whole new resonance. Lightning Entertainment brings “The Irishman” to the table directed by Jonathan Hensleigh (the writer of “Armageddon”) and starring Val Kilmer and Christopher Walken in the true story of Danny Green, a tough Irish thug from Cleveland who single handedly wiped out the Italian Mafia in the 1970s. Moment Of Truth Entertainment , by comparison, offers “Don McKay” which stars Thomas Haden Church and Elizabeth Shue in the story of a man returning to his hometown when he receives a letter that his ex-girlfriend is dying. When arrives back, he sees things are a little bit off in a town where everyone seems to hiding something. Returning the Asian continent, M-Line, out of South Korea, offers two distinct films. “Closer To Heaven” follows a man who is diagnosed with Lou Gehrig’s disease. At his mother’s funeral he meets a service worker there whom he knew back in childhood. They fall in love and she gives him the will to fight even as his situation worses and begins to be unable to speak. Sounds like a performing tour de force. “Yoga”, M’s second film, follows the star female host of a home shopping network,who enrolls in a yoga academy competing against others to achieve spiritual enlightment until “strange and eerie events begin to unfold”. Mandate adds two more films out of the gate. The first, Knock Out, from director Steven Soderbergh, casts unknown Gina Carano as “a top level private security operative convinced that she has been betrayed by her boss and her government” only to learn her suspicions are true.” “The Next Three Days” directed by Paul Haggis (“Crash”) stars Russell Crowe and Elizabeth Banks in a story about a couple’s life which is torn apart when a man’s wife is imprisoned for murder. After years of appeals, the man devises a dangerous plan to free her which may leave them alive or dead.

Quick Bits There are a lot of other films in play which simply have the would be partipants in play but without a released storyline. Gaumont has “Splice” (completed) starring Adrien Brody and Sarah Polley as well as “Twelve”, in post, directed by Joel Schumacher starring Chace Crawford and Emma Roberts. Morgan Creek has “Dream House” in pre, directed by Jim Sheridan (recently of “Brothers”) starring Daniel Craig along with “Passengers”, a sci-fi script in development with Keanu Reeves attached to star. Nu Image/Millenium has “Rambo V” in pre with Sly Stallone set to write and direct and “Drive Angry 3D” in pre as well with Patrick Lussier set to direct with Nicolas Cage starring. Odd Lot Entertainment has “Rabbit Hole”, currently in post, directed by John Cameron Mitchell and starring Nicole Kidman and Aaron Eckhart. Paramount Vantage International, which is still in play, has “13” in post from director Gela Babulani starring Mickey Rourke and Jason Statham aking with “The Crazies” directed by Brent Eisner (of “Sahara”) starring Timothy Olyphant and Rahda Mitchell. Summit Entertainment, in full throttle with “The Twilight Saga” going full force has a three fold progression. “The Beaver” directed by Jodie Foster which co-stars her and Mel Gibson is in production. “Fair Game” directed by Doug Liman (of “Jumper”) stars Sean Penn and Naomi Watts is prepping. Lastly, “The Runaways”, in post, about the early band of Joan Jett, stars “New Moon” alums Kristen Stewart and Dakota Fanning. Voltage Pictures also has two in play. First “Game Of Death“, in production, directed by Abel Ferrara (of “King Of New York” fame) stars Wesley Snipes followed by “The Whistleblower”, also in production, starring Rachel Weisz and Monica Belucci.

The one angle to say is that the American Film Market this year is not hurting for product, and despite some purely formulaic narratives, perpetrated by money, a lot of the material, especially in post, seem to play exceptionally fluid and intelligent which bodes well for the movie going public whether it be on DVD or in theaters. With a moderation of films being made, only the better seems to move through the pocket or at least continue as guaranteed possibilities. As the panel attended indicated, North American distribution is all but certain but necessitates the backing from overseas to signal a commanding presence.

Narrow Windows & Creative Distribution: The 2009 IFTA Production Conference – Feature

The state of the industry sometimes can be a troubling thing but there can always be light at the end of the tunnel depending which way one is looking. Attending the Independent Film & Television Alliance (IFTA) Production Conference in Century City, one could feel the progression and honesty setting in as the aspects of the new state of distribution which were adequately discussed The realization and decision on approach creates a more stable thought for the future.

After opening remarks by former Fox Chairman Bill Mechanic, who declared in tandem that the balance of technology and attendance will create a new structure since “the outlets are there”, gave credence to the impending discussion of the state of new distribution avenues and financial incentives to motivate the industry.

The discussion entitled “New Distribution Options For The Future” was piqued by the initial thoughts of Pierre David, the chairman of the producers committee of the IFTA, who said simply “find your niche and do that stuff”. His perception is that even with a big film, in terms of the aspects of pre-sale or even specific territory basis, you might be “lucky if you get $10,000 in Italy”. He also marks that the UK sector as down too since Woolworths basically dumped 1000s of DVDs onto the streets to be sold in the past ywar. He does make the point that Germany and Australia are stable in terms of its markets but that is a rarity in the world. He believes that there is still a DVD Market in the States but that too is down 17% as of this year. Unless you have a pre-sold perspective like a Lundgren, Seagal or a Van Damme, it becomes difficult. The category of increasing interest, in his perspective, is television because, in his mind, it is a stable world where you can have a game plan. There is a flow of channels opening up worldwide and this should be considered part of the future. There are outlets on Lifetime, Icon and ScyFy but you have to make the right kind of product. Pierre also mentions the incumbent impact of VOD [Video On Demand[ using IFC as an example but saying that currently in the sector, they will grab 70% of the revenue.

Nolan Gallagher, Founder & CEO of Gravitas Ventures, balances this saying that there seems to be a lot of confusion, in his mind, as to where the revenue is coming from. The big question is when VOD is going to be the savior. People are starting to make money in the sector but is it enough to warrant the movie budgets? Gallagher says that there will be a continual integration into digital cable in the homes. The amount of digital boxes will increase viewership at least 20 million. The going rate currently to put your movie in front of 50 million potential viewers via an On Demand possibility is $20,000 but there is no gaurantee anybody will buy or watch it. Publicity, he says, even the most basic kind, is key. The thought right now in terms of a workable model is a transactional VOD deal for four or six months then switching to a TV deal right after as a blueprint. The problem is that you can make at times only $5000 on such a deal which seems non-productive. This is because people tend to want to underpromise and overdeliver which is the paradox of sorts. A horror film, in his estimation, can do $80,000. The growing angle is a deal through a multi-pronged distributor like a Lionsgate which can get into 50 million homes direct (in the VOD sector) through Comcast and Time Warner Cable. Right now there can be 140 movies on Comcast On Demand at any given time. The inherent problem is that a year from now there might be 1400 movies showing an increase of tenfold and a saturation that makes differentiation hard. It all becomes about marketing in this scenario. The benefit approach here is to approach two or three different companies and rotate them on subsequent projects . This of course can present a negotiation problem but the specific Gallagher suggests is to only make the deals for 2 year intervals.

In comparison, Steve Bickell, who heads International Distribution for The Film Department, says that the bottom line is that the economic structure of the film business is absolutely broken. The inherent change works from generation to generation. There was an overabundance of video when video came in. Same with free channels and the influx of cable. Now DVD sales are falling and VOD is not able to pick up the slack because currently there are no safety nets in terms of business models. International Distribution is much more difficult and selective now because all the territories have compacted their business. Our domestic distribution model here in the States, Bickell explains, doesn’t exist anymore. It is virtually impossible to find a domestic distributor to do what you need since most of them won’t do P&A (Print & Advertising) anymore. This makes it hard in the short term to get films off the ground. The issue of key is the marketing and how to use it. The future is coming he says but “the timing is fucked up”. Even going to 50 million homes unless there is a back end is not enough to finance a film.

Marc DeBevoise, Sr. VP of Digital Media at Starz, offers a slightly different perspective. His thought is that doing the DVD process is still cheaper than doing a digital file for consumption. We are closer to a branching point, he believes, than most people think. The problem, in his experience, is that people tend to make a quick or rash decision in terms of their distribution. As a rule, he suggests to not doing anything ad supported as a first spot distribution point. Jumping the gun into “free” is something to be very wary of. His perspective is that those who survive will be able to piece themselves back together if they figure out a way to get to the promotion and secure a slot on a new media platform. His company used to do 100 DVD releases a year which is now down to 50 maybe even using the angle of their own Anchor Bay films.

Curt Marvis, President Of Digital Media at Lionsgate, is in a key position with a justified perspective in helping jumpstart this new revolution. He says that LG has changed dramatically over the past ten years which is what has allowed them to remain competitive. They are no longer a private distribution company. They now own 50% of TV Guide Network and FearNET. He relates that he had a meeting last Friday with the senior heads of the departments of Lionsgate. It was set up to show what was happening at the VSOs and the cable networks in terms of the VOD initiative. He says there are now a number of new points of distribution. They went through about 15 boxes of different territories and angles. If you look at XBOX, it reaches about 23 million people. That is larger than the 22 million subscribers for Comcast which is the largest MSO in the country. Add on top of that the IPOD and ITOUCH users who are in the billions but, of which, over 50 million buy and download regularly. Add on top of that the fact that YouTube might be moving to a transactional based business and there is a whole new world. However, it needs to be functional in terms of a business model. There is a large audience that exists but it matters how to get to them. The film industry currently has no direction from which to exploit this area. Marvis believes these are the deals to make along with TV. In the downturn, he says making reference to Bill Mechanic’s early statement, there is opportunity on the back end of this crisis. VOD simply has not picked up the slack yet because of consumer awareness but that will change. Consumers simply need to be educated. Marvis still believes it will 2 to 3 years before VOD truly takes off but will become more diversified in the channel offerings that will be coming online.

Elizabeth Guider, an editor at Hollywood Reporter, has a similar perception to some of the others but comes from a different angle in the mass media. She sees the current crisis as a complicated situation. As the media, they want the independents to have success but it is just not happening. At The Reporter, they are tracking an alarming amount of bankruptcies, somewhere between 30 and 50 with the amount of production deals are going down from 550 to about 250. All the Pay TV deals have dried up since the channels themselves have started to merge together to save their own bottom line. By reaction, their stocks have plummeted and their ad sales are simply done. Summit somehow with “Twilight” was able to capture lightning in a bottle but that is an isolated occurence.

Gustavo Montaudon, President of Alebrije Entertainment, handles a lot of the business for Latin America which he says is having tough times in terms of theatrical business. Technology primarily is a problem down there with a lack of broadband. The VOD operators are scarce with Digital Latin America being the only primary. The TV component is growing but at a disconcerting rate.

Howard Frumes, a well respected attorney from Alexander, Frumes & Horowitz and the counsel for the IFTA, offers an almost chilling perspective. He says that the oddity is that that right now more than half his time is spent on productions coming in or in actual investments from China. It is not American or European co-productions. They look at them more as “local films”. The domestic marketplace is no longer a source of financing for independent films. The problem is that with China they are still building theaters. Frumes says the highest grossing film in China was “Titanic” but that was over ten years ago. China is the one optimistic outlay. The problem is that most people are relying still on P&A which is a hundred-year-old mechanism and no longer applies, especially with digital. He cites in terms of stories pictures like “Juno”, “Slumdog Millionaire” and “Twilight” which are simply more direct in their angle of marketing globally. The key he says is that at the very beginning, you have to think about the very end.

His advice is threefold. First, when you start looking at your film and script, keep in mind that you have to deliver on all these mechanisms. You have to build some marketing dollars into your budget from the get go. Second, you need to have a variety of people to collaborate with. Meet with marketers, international distributors and bankers to get a perspective because no one can get credit currently. The key is going with different partners on a case-by-case basis whether it be European, Asian or whatever. The key is diversity.

The closing thoughts, which drew applause, came from Mitchell Berman, CEO of Zillion TV, who was more theoretical (which seems a little like grandstanding) than the practicality of the others. Berman admits that we are in a state of change but that it is going on all over the world. He says that we have to just take a method and try it then try it again, making a reference to a quote from FDR back in the 30s. Berman says that he started at HBO and then help start Sky in New Zealand. The new aspects he is seeing in Asia he believes will change the perspective. 4G has already started to permeate and Verizon has started to deploy it. It is all about who can adapt to the change in technology that continues to permeate. He mentions Vizio specifically as a distribution channel outlet since it works through wireless. His specific structure is that old people are holding onto old business model. The new people are ready.

It is just seeing what is coming ahead of the pack. But time is a battle for distribution that will fought as the years progress.

By Tim Wassberg