Magazine article Variety

Mountain's Peak

Magazine article Variety

Mountain's Peak

Article excerpt

With a week to go before Sundance officially starts, Netflix swooped in to nab global streaming rights to "Tallulah," a dramatic comedy that reunites "Juno" stars Ellen Page and Allison Janney.

The deal, wrapped up covertly, swiftly and with a big price tag, signifies the dramatic changes roiling the independent film industry.

Consequently, Sundance and other film markets have become a tale of two competing business models, and the story doesn't always have a happy ending.

"There's been an insane influx of money," says Eamonn Bowles, CEO of Magnolia Pictures. "These bidding wars for high-ticket items, where you're spending lots of money and hoping for a big breakout hit, is one of the worst business strategies. For every 'Little Miss Sunshine' there are five instances of'Happy, Texas,'" he adds. Both films took Sundance by storm, but the former turned into an Oscar-winning hit, and the latter, a 1999 comedy, collapsed at the box office.

It was a lesson that somehow was lost on many who trudged up to Park City last year. "Dope," "Me and Earl and the Dying Girl," "The D Train" and "Mistress America" were each acquired for hefty sums, and received warm receptions from Sundance crowds, but flopped when they were presented to the general public. Of the films that inspired heated bidding wars, only "Brooklyn," the Oscar-nominated romance about an Irish immigrant, reaped a financial reward.

"There are so many new players with serious money," says Sony Pictures Classics co-founder Tom Bernard. "And there are more options to get your movie seen than ever before. It used to be that filmmakers could maybe get theatrical distribution or their movie went nowhere or maybe straight to DVD."

Netflix, Amazon and other digital buyers aren't the only well-capitalized companies willing to pay top dollar for arthouse films. And that's good news for an indie market in flux. Relativity Media, for instance, is still in the throes of bankruptcy; and the Weinstein Co. plans to scale down the number of films it releases each year, and focus more on its television operations. At past Sundance festivals, Harvey Weinstein could be counted on to leave the snow-covered gathering with at least one or two high-profile acquisitions in tow.

That may not be the case this year, but other well-heeled companies are expected to fill the gap. Broad Green (backed by hedge fund billionaire Gabriel Hammond and his brother Daniel), Bleecker Street (financed by 5-Hour Energy founder Manoj Bhargava) and the Orchard, a music and media company that made a splash at last year's edition of the festival by picking up "The Overnight" and "Cartel Land," are all on the prowl for product.

"We are going to be as competitive as we were last year," says Paul Davidson, senior vice president of film and TV at the Orchard. "We hope to come out of Sundance with a good selection of titles to fill our slate."

The advent of digital technology has not only expanded the ways movies can find an audience, it has also made films cheaper than ever to produce. For instance, "Tangerine," a look at transgender prostitutes that was one of the breakout hits at the last Sundance, was shot using an iPhone; that would not have seemed possible a decade ago, but the technology has now spawned film festivals of its own.

But there are downsides to these new forms of distribution, and to an arthouse scene that has suddenly piqued the interest of digital powerhouses such as Netflix and Amazon, which are eager for original content that can help attract subscribers. The companies are able to pay top dollar for films that are quirky and edgy, without worrying about their box office prospects. Success for a dark drama like Netflix's "Beasts of No Nation" or a polemical comedy such as Amazon's "Chi-Raq" is measured in streams and new subscribers, not ticket sales. That's not the case for smaller indie distributors, whose fortunes can rise or fall with each new release. …

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