"Distribution ®evolution."

It was an odd place to hold a panel entitled "Distribution ®evolution" - an adobe barracks turned state park that used to house the Mexican Army. The revolutionary spirit huddled on folding chairs in an upstairs room wasn't quite so violent as that of its long gone predecessors. Moderated by Microcinema's Joel Bachar, the panel's participants were Sonoma's take were GreenCine's Content Acquisitions Director Jonathan Marlow, filmmaker Caveh Zahedi, Wellspring's VP of Theatrical Sales Marisa Keselica, Netflix's Chief Content Officer Ted Sarandos and Houston King of Goodbye Cruel Releasing, whose recent distribution projects have included Andrew Bujalski's wonderful films Funny Ha Ha and Mutual Appreciation.

Bachar began the panel by asking Zahedi to tell the audience about the controversy surrounding Mark Cuban's recent decision to pull his film, I Am a Sex Addict from all Landmark cinemas operating in Comcast markets. The situation with Sex Addict and Landmark sounds confusing in a sentence and only gets more so with a paragraph or four. Zahedi's telling of the story drew murmurs of outrage from the audience, though I've yet to attend a panel in the SF Bay Area that didn't draw murmurs of outrage, no matter how bland the inspiration for them. In this case, the story has prompted some passionate online debate.

The term "day and date," as it was being used in the panel, refers to the simultaneous release of a film in theaters, on DVD and via Video-on-Demand (online and through cable TV). VOD might impinge on a film's box office, but if the distributor for both channels is the same, or if the theater owner is compensated with a share of DVD/VOD sales, profits might even out. Marlow noted Cuban's interest in keeping the entire chain of distribution in his own hands (from production through to TV, DVD and theaters). Cuban has been a proponent of experimenting with DVD release percentage partnerships with theaters, but his experiments with day and date have entailed VOD only for the opening night, diminishing any potential impact on box office over a longer period of time.

All parties seemed to agree that theatrical distribution is still essential to the success of a film, regardless of whether the profit is ultimately made on theatrical, DVD sales and rental or VOD. A theatrical release generally guarantees a higher level of exposure, particularly through print reviews and TV spots.

King voiced concerns that day and date releasing could be cases of larger companies using smaller indie filmmakers as sacrificial lambs for data to ultimately convince studios that VOD might work for bigger films. That said, it makes sense that the model is being tried by smaller filmmakers because of the prohibitive expense of opening on a large number of screens. Using the day and date model, indies can open in two, maybe five cities and then leverage that publicity into instantaneous, nationally available VOD or DVD sales.

Studios do not seem willing at this point to completely close the window between theatrical and DVD/VOD releases. They still hang on to the idea that people are willing to buy their product twice, once at the theaters and once to own. They understand the appeal of one marketing campaign over two or three, but are nervous about closing the gap completely (witness Sid Ganis's speech at the Oscars). It remains to be seen how much they really care about these other experiments, said Marlow, post-panel.

The conversation then moved over to the practical side of theatrical distribution. It appears that there are rarely written agreements between distributors and theaters, which means there is no recourse available to filmmakers whose films that are pulled. Keselica sited Landmark's recent decision to pull Wellspring's Unknown White Male from a theater in New York recently, but didn't go into many details.

Both Sarandos and Marlow went on to warn filmmakers off signing exclusive VOD deals with cable or online content partners. Cable companies are worried about losing subscribers, so they are aggressively pursuing exclusive agreements, even with larger content partners like PBS and HBO, said Sarandos. GreenCine has been offering VOD via the Internet for several years and Netflix has made no secret of its intent to move entirely in this direction. Sarandos sees this as a long-term goal, though; he mentioned 10 to 15 years.

It soon became evident that rights issues are very murky right now. The division between the Internet and TV is one aspect, but here Marlow brought up the line between domestic and international rights, as well as the expiring rights that many documentary filmmakers have to the archival footage used in their films. In a question from the audience, one of the filmmakers behind The World According to Sesame Street asked for advice on working with educational distributors who often charge educators ten times the amount of a regular DVD sale. It seems that this whole model, too, is in flux. King encouraged filmmakers to consider self-distribution, even on a limited budget, as opposed to going through distributors for hire.

Bachar touched on the concern that some filmmakers have about ruining their chances for a contract by putting their films up online for free. Sarandos seemed to disagree, noting that Netflix released Loose Change on DVD after his nephew showed him the film on MySpace. Both Marlow and Sarandos agreed that customers appreciate easy, immediate access to films over exclusivity.

The most notable aspect of the panel was its seemingly unanimous support of the day and date distribution model. Amongst these folks, the debate is no longer when, it's how. That's a much tougher question - one that will probably discussed by about ten more years' worth of panels.

Posted by dwhudson at April 14, 2006 6:22 AM