Time To Get Back To Basics

The US distribution arena received another blow this week with the news that Bob Berney was resigning from Apparition, the outfit he had set up with Bill Pohlad last year.

While Berney’s next steps are the subject of furious speculation here on the Croisette in Cannes, the surprise news that Apparition was sans leader and not attending the festival was disappointing news to the global sales and production community which is already struggling to put ambitious movies together without that crucial domestic piece.

Several sales and production companies looking for US homes for their films were banking on Berney to pick up one or more of the available titles at Cannes such as Alejandro Gonzalez Inarritu’s Biutiful to Mike Leigh’s Another Year.

“For all the enthusiasm about Berney being back in the market, he wasn’t actually free to spend big bucks on pre-buys or acquisitions.”

Berney actually only bought two films in his tenure at Apparition – Jane Campion’s Bright Star and Nash Edgerton’s The Square – while handling films he inherited from Sony Pictures Worldwide Acquisitions Group (SPWAG) and Pohlad’s River Road Entertainment. So for all the enthusiasm about Berney being back in the market, he wasn’t actually free to spend big bucks on pre-buys or acquisitions.

Nor are the other independents spending large on upscale films. Lionsgate, which is getting back on its feet after fending off Carl Icahn’s aggressive takeover bid, may take the odd specialized title like Precious but its focus is mainstream movies like Kick Ass, The Expendables, Saw VII and The Next Three Days.

Likewise Summit, which may cherry pick the odd prestige title like The Hurt Locker, but is really in the business of The Twilight Saga, Furry Vengeance, Letters To Juliet and Red.

This is in stark contrast to the situation just three years ago when Paramount Vantage, Miramax and Warner Independent Pictures were backing the likes of Paul Thomas Anderson, Paul Haggis and Inarritu, and buying other ambitious, director-driven films.

The trouble, of course, is cost. It’s one thing to pay a large minimum guarantee to secure a film. But a crossover prestige movie takes a lot more money to launch into the vast US marketplace and to keep it playing in theatres. However targeted your marketing or publicity efforts, there has to be some TV spend and, if an awards campaign is involved, numerous other heavy costs. In the free-spending heyday of Vantage and Miramax, these art films were costing tens of millions of dollars to release. The consequent grosses weren’t big enough to warrant further investment from studios.

So perhaps it’s time to go back to basics with these prestige films. The costs of their production needs to come down and so does the cost of their releases in the US.

Berney is one of the best distributors there is at building a film and keeping it going week after week. At Apparition, he grossed over $10m each for two SWAG titles - The Young Victoria and The Boondock Saints II – without over-spending. It’s the classic distribution pattern of building word of mouth and audience that the early Miramax and Sony Classics models were built on and independent veterans like Bingham Ray practiced throughout the 90s.

“Its times to back to basics with prestige films - the costs of production needs to come down and so does the cost of a US release.”

For new players in this dangerous arena, the challenge is to manage cost. As studio output decreases over the next year and the number of films being released comes down, the chances to get a film into the marketplace with less spending could become more possible and new digital opportunities allow marketing word to spread in a more viral and less cost-intensive fashion.

Perhaps only once these costs come down will it be possible to build crossover hits and make money in the process rather than pay through the nose to release them and risk losing a fortune.