The international businesswas transformed on Friday as two of its market leaders Intermedia and SummitEntertainment formed a sales, marketing and distribution joint venture calledIS Film Distribution which instantly becomes the biggest seller in the marketplace.
As a result, Intermedia andSummit will transfer all their distribution and marketing staff into IS.Intermedia's distribution chief Jere Hausfater is exiting the company andSummit will handle all future sales on behalf of the joint venture. IS will bebased in Summit's Santa Monica headquarters, although Intermedia's president ofworldwide sales Michael Dragotto will remain at the company to supervise ISFilm Distribution activities on behalf of Intermedia.
Speaking from Los Angeles onFriday, Summit CEO Patrick Wachsberger and Intermedia CEO Moritz Borman saidthat IS is modelled on studio distribution joint venture UIP in that it willhandle films produced by either party or films for which either company alreadyhas distribution agreements. Both Summit and Intermedia will continue tooperate independently of each other, and the joint venture should have noimpact on Intermedia's corporate parent Internationalmedia or its German marketlisting.
All film development,financing, and production will be handled separately by both companies,although the joint venture could lead to future production collaborations, saidthe CEOs. Graham King's Initial Entertainment Group (IEG), which is owned byIntermedia, will remain autonomous and Pamela Pickering will continue to handledistribution on IEG product. "Graham will make a couple of movies a year andwill sell them himself," said Borman.
IS begins operating today(Monday) and will start representing both companies at the American Film Market(AFM) next month. "It has major cost-saving elements such as one suite at AFM,fewer trade ads etc," said Borman.
Summit will continue tomaintain its London office under David Garrett; ironically former Intermediasales executive Harold Van Lier moved to Summit in London last summer and isnow reconciled with his former bosses.
Borman said that theestimated first year revenue of IS Film Distribution will be in the $300mregion, "We have a dominant market position," he said. "There are not manysales companies out there and the timing is right for us to create IS, which isthe biggest ever independent sales company."
Borman and Wachsberger havelong been in discussion about teaming up but Wachsberger said that the marketis such at the moment that size matters. "We will have one strong voice," hesaid. "International buyers will now have the strongest contractadministration, the strongest marketing team and a one-stop shop. No longerwill we be playing against each other."
Wachsberger said that ISplans to work with as few companies as possible in each territory. "We bothhave great relationships with different distributors in each country, but weare now operating totally out of the box. In some territories, we want to helpcreate some companies and help some distributors find financing on the basis ofour product."
As yet Hausfater has noset plans. After 14 years in acquisition and sales at The Walt Disney Co, thewell-respected executive joined Intermedia as president of worldwidedistribution and acquisitions in July 2000. "We wouldn't be here if he didn'tdo that job," said Borman.
Borman said that Intermediahas four new films set for production this year including Oliver Stone'sAlexander The Great project starring Colin Farrell to which Warner Brosrecently committed as domestic distributor and Me Again, a thriller with Bruce Willis starring and producingand Dean Parisot directing. No international distribution plans have yet beenfixed. Other Intermedia films to be released include Basic (Columbia, domestic) starring John Travolta, TheLife Of David Gale with Kevin Spaceyand Kate Winslet (Universal, domestic), Dark Blue with Kurt Russell (UA, domestic) and T3: Rise OfThe Machines with ArnoldSchwarzenegger (Warner Bros, domestic).
Summit meanwhile will continueto represent films from producers such as Alcon Entertainment (Insomnia, TheAffair Of The Necklace), WaldenMedia (Around The World In 80 Days, Holes), Artisan Entertainment (The Ninth Gate, The Blair Witch Project), Constantin Film (Smilla's Sense Of Snow), Crusader Entertainment (Sahara), Mandalay Pictures (Beyond Borders, Serving Sara), Escape Artists and Newmarket (Memento). Summit's own productions include horror movie WrongTurn, a co-production withConstantin Film, and Dot The I whichworld premiered at the Sundance Film Festival last week.