Some independent players see it as a 'healthy correction', others as a 'turning point'. One company chief recently suggested, in a Los Angeles Film Festival speech whose words have ricocheted around the indie community, 'the sky really is falling'.
However you describe it, what has happened to the US independent industry in the last few months has raised big questions about its future, and the future of the specialised distribution sector that over the past decade has pushed the profile - and sometimes the performance - of independent films to new levels.
First there was the decision by Warner Bros, which had just announced its plan to turn New Line into an in-house genre label, to close down both of its specialty divisions - Picturehouse and Warner Independent Pictures (WIP).
Then Paramount said it was merging the marketing, distribution and physical production departments of its Paramount Vantage specialty arm into those of the main studio.
A few weeks later, the studio named former New Line executive Guy Stodel as Vantage's new executive vice-president of production and acquisitions, suggesting a move by the specialty arm away from prestige films and towards genre fare.
Put the studio's moves alongside the downsizing of independent specialty operation Sidney Kimmel Entertainment, the financial problems being encountered by ThinkFilm and the acquisition of the Sundance Channel cable network by the owner of rival IFC, and you have a worrying confluence of events.
'It's probably true to say it's healthy, and it's absolutely true to say it's a correction,' concedes Mark Gill, The Film Department CEO and former Miramax and WIP president who sounded the alarm at the Los Angeles festival. 'But it's a correction in the way that a massive earthquake is a correction.'
Warner and Paramount certainly appear to have had their own unique reasons for retrenching. Launched in 2003, WIP had early success under Gill with March Of The Penguins and Good Night, And Good Luck. But last year, under Gill's replacement Polly Cohen, its best domestic performer was the $6.8m-grossing In The Valley Of Elah.
With hits such as Pan's Labyrinth and La Vie En Rose, Picturehouse, headed by well-regarded indie executive Bob Berney, was believed to be profitable but perhaps not profitable enough for its bottom-line oriented conglomerate parent.
Bottom line drives withdrawal
In emailed answers to questions about the closure of the two divisions, Warner Bros president/COO Alan Horn says for the studio 'to have three theatrical development, marketing, production and distribution arms, essentially serving the same function and even competing with one another on various levels, does not make economic sense'.
Horn insists, though, that the studio remains 'fully committed' to independent film distribution, with either Warner Bros or New Line set to release films that would previously have been released by Picturehouse or WIP. 'We'll be at the festivals,' he says. 'If we like a picture, we're going to buy it. If we like a pitch, we'll develop and produce it.'
Paramount Vantage arrived in the indie sector in 2005 and original president John Lesher put the division on the map with a high-profile slate including Babel, No Country For Old Men and There Will Be Blood (the latter two co-financed with Miramax).
The slate earned Paramount plenty of awards, but sources suggest that on top of the film's $40m budget, Vantage spent so much to market There Will Be Blood in the US that making a profit was never likely, even with a decent domestic gross of $40.2m.
Other Vantage projects - among them A Mighty Heart, Into The Wild and Son Of Rambow - have disappointed at the box office.
Lesher's promotion to president of the overall Paramount Film Group is seen by some as another factor in the decision to streamline the specialty unit (neither Lesher nor current Vantage president Nick Meyer was available for comment).
The Warner and Paramount moves also reflect a trend whose effect is being felt by all the studios operating in the specialised distribution sector, and by larger independents as well.
According to figures from the Motion Picture Association of America (Mpaa), the average production cost of a studio specialty division film shot up 60% in 2007 to $49.2m. And the average marketing cost jumped 44% to $25.7m. A lot of money to spend in pursuit of uncertain box-office returns and award-season kudos.
Meanwhile a glut of product - 500 or 600 releases a year in the US, a market that some say can only support 300 - has made it harder than ever for specialised films to stay in cinemas.
At the production end, the drying up of Wall Street financing - just last week a $450m Deutsche Bank deal for 30 Paramount films collapsed - may be prompting the studios to reconsider their specialty-sector ventures.
'With the contraction of capital availability for the overall industry, vertically integrated media companies are jettisoning less profitable divisions,' says David Davis, managing partner at US investment bank and consulting firm Arpeggio Partners. 'One of the first kinds of businesses to be shut down are the specialty divisions.'
A winter of discontent'
So after a summer of apparently gloomy news, are specialty films facing an autumn and winter of discontent or worse' Not necessarily.
Some say they have already started to adjust to the harsh new realities that were evident at this year's Sundance and Cannes festivals, where a number of high-profile specialised films failed to secure US distribution deals.
The formal demise of WIP will make little difference, suggests one indie player, because 'you got the sense they were never empowered to go out and do their job.
'WIP was, for all intents and purposes, gone for a year and a half (before Warner announced its closure).'
The jury is still out, though, on the changes at Paramount Vantage. The division may eventually lean towards more mainstream commercial projects, but its autumn slate includes awards contenders The Duchess with Keira Knightley, and Sam Mendes' Revolutionary Road starring Leonardo DiCaprio and Kate Winslet.
And under the studio's new structure, such films will be marketed by a department headed by one-time Miramax marketing head Gerry Rich.
What producers and sellers are expecting is that continuing specialty divisions will be more careful about getting involved in high-end projects.
'There will be some downward pressure on costs, both production and marketing,' says Rich Klubeck, head of United Talent Agency's independent film group.
'People will continue to take a close look at how many specialty films a year do the kind of business it takes to warrant their cost structure.' Already, he adds, distributors are being 'more selective than ever and there's more scrutiny of the perceived marketability'.
The specialty divisions may also focus more on genre and comedy films, hoping to emulate the success of Fox Searchlight's smash Juno.
Michael London, whose Groundswell Productions, with Participant Media, produced the summer's only breakout specialty hit The Visitor, reports that distributor interest in indie dramas, at least those without a clear talent or content hook, has been waning for the past year.
Now, says London, 'people are much more comfortable making a genre movie or a comedy, or making a movie that's a little bigger and trying to take advantage of talent that gives the movie a bigger profile.'
How the specialised distribution sector will emerge in the long run is tough to gauge, but London and others are convinced new or existing distributors will take up whatever slack is left after the summer shakeout.
Specialty divisions at studios other than Warner and Paramount have so far remained untouched and may now benefit from operating in a less competitive environment.
'I don't think the studios want to get out of the specialty business,' says John Sloss, founder of Cinetic Media, whose sales to specialty divisions have included Little Miss Sunshine and Napoleon Dynamite. 'The core economics of studio specialised movies are better, I would say, than those of big studio tentpole movies.'
Fox Searchlight remains the most successful of the specialty divisions, thanks largely, say indie players, to its knack for producing and acquiring films that are best suited to its well-honed marketing skills. After a run of success with comedies including Sideways, Little Miss Sunshine and Juno, and genre outings including 28 Days Later and The Hills Have Eyes, Searchlight has its pick of the specialty projects on offer.
Miramax, observers suggest, benefits from the strength of its brand and from concentrating on films that are clearly distinct from the family entertainment favoured by parent Disney.
Headed by former Disney UK executive Daniel Battsek, Miramax will this autumn look to follow up on the success of last year's No Country For Old Men with awards contenders such as Brideshead Revisited and Blindness.
Focus Features, run by James Schamus since original partner David Linde became co-chairman of parent Universal, has stayed in the game by using its international sales operation to offset costs and by broadening its slate to include films from genre arm Rogue Pictures.
After scoring with Working Title's Atonement, Focus will this autumn compete with the Coen brothers' George Clooney/Brad Pitt vehicle Burn After Reading, which is opening the Venice film festival, and producer Michael London's Milk with Sean Penn.
Sony bucks the trend
Sony Pictures Classics is the anomaly among the studio specialised divisions, sticking to its well-tested strategy of acquiring smaller independent and foreign-language films such as last autumn's $11.3m-grossing The Lives Of Others.
The remaining specialty divisions may be joined by new or existing independents that can adapt to the changing specialised distribution environment. In fact, says Cassian Elwes, co-head of William Morris Independent, what the specialised sector may be seeing now is 'the studios revolving out of independent cinema and hopefully the void being filled by new, strong independent companies'.
The new players could include Summit Entertainment, which is believed to be considering the addition of specialised pictures to its domestic distribution slate of mid-range studio-style releases; Lionsgate, which could enter the space through its minority stake in Roadside Attractions; and Overture Films, which made its mark this summer by shepherding The Visitor to an $8.8m-and-counting domestic take.
Overture COO Danny Rosett says while a reduction in the number of distributors for independent films is never good, 'obviously it opens up an opportunity for us to demonstrate we can be nimble and provide an alternative'.
One familiar name expected to eventually re-emerge in the specialised sector is Bob Berney, the Picturehouse chief working at Warner on his division's last few remaining releases - Mongol, Kit Kittredge: An American Girl and The Women.
Berney does not reveal any concrete plans for a new specialised venture, but, he says: 'I believe the audience is still there. I don't think that suddenly the audience went away.'
To tap successfully into that audience, Berney believes, a specialised distributor has to be disciplined and offer up more than just art films: 'Be open to a diverse slate that could include a family film or a genre film as well. I think that model is still workable if you make smart decisions.'