Rant on The Death of Indie Film as a Business Model

Went to dinner with an indie filmmaker last night. Here’s a rant based on that.

Synopsis: I think indie movie making as a business model is deader than fried chicken.

Hoping to make your little movie and make a living off of it, until you can get the next one going? Very unlikely, unfortunately.

As somebody mentioned in an email to me about this, moviemaking digital tools came along to help reduce (some) costs of moviemaking, but other digital tools came along that stripped away the marketability of those films even faster (bootleg downloads, too much content, competition for time from internet/cable/DVDs/games/etc.) and the math isn’t working out favorably right now.

Supporting evidence below:

updatea lot of the commenters (and about 60+ comments so far) are saying indie film has ALWAYS been tough and risky. I AM NOT DISAGREEING. I am saying it has become ESPECIALLY brutal in the last couple of years, the non-viability is ramping up, making the proposition even worse. Also, personally, I’m defining indie as non-studio fare, probably self-financed or independently financed, and seeking distribution by any means profitable. What are YOUR experiences with distro? Chime away in the comments! I’ve posted and rebutted extensively in the comments as well, more stuff in there. End update.

My friend’s film:

-he made a doc, shot on film, about free software. Is available, against his will and illegally, on Google Video subtitled in many languages.

-he gave up trying to stop it – was too diffficult and time consuming, Gooogle does nothing

-clear track of sales decline from when YouTube/Google Video versions started popping up

-problem: make a movie about free stuff and technology, maximum likelihood of it getting ripped off

In any case, we’d previously talked about the Bad Math of indie moviemaking – Mark Gill’s infamous (yet deadly accurate) speech about the odds against indies – 5000ish submissions to Sundance, 120 screened, maybe 2-3 make their money back. Basically, odds are 99.9% likely you’ll lose money

-look at how many movies open every week/weekend – how can your indie compete? I noticed that the great clever little indie Timecrimes that I saw at FantasticFest (think Primer but with more recursion) is opening against:
-Delgo – that weird homebrew animated thing from some Atlanta interactive guy – I fear it’ll get slaughtered at the box office, too
-The Day The Earth Stood Still with Keanu Reeves, Jennifer Connelly
-Doubt with Meryl Streep, Phillip Seymour Hoffman
-Gran Torino with Clint Eastwood
-Reader with Kate Winslet and Ralph Fienes
-What Doesn’t Kill You with Mark Ruffalo and Ethan Hawke

You wanna go up against the box office prowess of Clint, Keanu, Meryl, Kate, etc.? Good luck with that..lost in the crowd…and I thought that movie was GREAT indie moviemaking, Go See It.

It’s been great that cost of indie moviemaking TOOLS has come down – but in the end, cameras and editing and finishing are cheap as compared to what it takes to put something interesting on the screen. Name brand talent, which is what it takes to get noticed, is still spendy (but perhaps sanity is re-emerging in the market). Want a cool action car chase? The cost of closing streets, hiring cops/stuntdrivers/cars/etc. hasn’t gone down, and has probably gone up. VFX are cheaper/easier, but audiences expect more. The math is going the wrong way. The growth of new avenues of distribution – online rental and purchase in all the myriad forms and formats, cable TV, DVD/Blu-ray, etc….means so many more ways to find stuff, especially for niche markets. That’s great. But the decreasing cost of production has vastly outstripped it.

Story – a guy trying to make little cheapo guns ‘n boobies sci-fi movies on the ultra cheap – make 3 a year. He got no bites on international distribution at some film market, and sold all domestic rights for $16K. That’s half of what he needed just to break even.

Another story – similar tale of someone who, after all the other fees and cuts and whatnot were done, got $2 per DVD as producer. OK – sold about 5000 units. That’s $10K compensation for making a feature film.

True Tale – a big box retailer has out and out STOPPED taking content from indie distributors – if you aren’t coming through the big boys, they don’t want your stuff.

-talking to someone involved in movie financing, I said I guess it sounds like you shouldn’t even try if you don’t have $10M. Without even pausing to look up from her salad, she instantly corrected “20 million” before she took a bite. Think about that – it seemed so intrinsically obvious to her that it wasn’t even worth looking up to make eye contact.

Anecdote – it used to be that the hot new movie directing talent came up through commercials and music videos – think David Fincher. McG is, I think, the last name I can think of that came up that route that has achieved commercial success. Anybody else? Anyone? Anyone? Bueller? Bueller? There was a list of top 50 hot talent something or other. Nobody under 30. Where’s the new talent coming from? Not from music videos anymore – there’s barely a market, and certainly no real money, in that anymore

Anecdote – talking to that indie director, he said he was at a film market and asked where talent was being hired from. Not from the states – the hot talent was being sought overseas, where there is effectively state sponsored filmmaking. Because it is too expensive to train/build your own director, waiting for their costly early films to lose too much money. Making a good movie is DAMN hard. For all of Hollywood’s egregious idiocy, they DO have some people paying attention to making movies that they THINK people want to see. They hire experienced people with proven track records…and still blow it all too often. It is HARD to make a good, successful movie that is profitable.

Overheard – ‘spend half your money making the movie, the other half on marketing’ – I hear of so many indie efforts trying to get together finishing funds, not realizing the costs of making acceptable deliverables, etc. Raise as much as you’ve already raised, again? A laughable endeavor for many – they can’t pull it off (the amateurs). Should they budget this way? Yes. Can they? No.

Indie moviemaking? Make more lower cost movies? With the massive decline in viewership of the original networks (ABC/NBC/CBS/Fox), competition for eyeballs online, on games, on cable, etc. – it is SOOOOO very expensive to market a film –
from a May 2007 NYTimes article:
“Last year, the average price for a major studio film increased 3.4 percent, to $65.8 million. By contrast, average marketing costs, which hit their peak in 2003, declined 4.4 percent to $34.5 million.”

From a March 2008 Studio Daily Blog entry (before economy fell into the shredder):
“The average negative cost on a feature released by an MPAA-member studio in 2007 was $70.8 million, with an additional $35.9 million in marketing expenditures, for a total of $106.6 million. Sounds like a lot, but what Poland zeroes in on is the average cost cited for releases from the quasi-independent specialty divisions of the same big studios (we’re talking now about the likes of Warner Independent and Fox Searchlight): $49.2 million, with a marketing spend of $25.7 million bringing the total to $74.8 million!”

Or just read the Mark Gill original: indieWIRE: FIRST PERSON | Film Department's Mark Gill: "Yes, The Sky Really Is Falling.": “We’re entering an era where the only films with any chance for success will be the $100 million-plus tentpoles, and reasonably priced films of some perceived quality.”

Some perceived quality…that means, probably in roughly this order: script, direction, acting, and technical competence. Note which is last.

Also talks about average marketing budget of $35M. AVERAGE. If spending $35M to advertise, might as well make it something GOOD. Let’s see….spend $10M or $100M for what we’re going to advertise for $35M….hmm….better do $100M.

Supply and demand is upside down – there’s WAY too much content, made on these easier and cheaper tools (relatively speaking) of the last few years competing for the limited amount of time we’re willing to watch stuff. More important than that however, is how willing we are to PAY for stuff.

This written in 1995, people: The Newspaper Industry and the Arrival of the Glaciers – Boing Boing:
“The price of information has not only gone into free fall in the last few years, it is still in free fall now, it will continue to fall long before it hits bottom, and when it does whole categories of currently lucrative businesses will be either transfigured unrecognizably or completely wiped out, and there is nothing anyone can do about it.”

At dinner, my friend was saying basically the same thing about creative content. Think about that, and re-read this line: “whole categories of currently lucrative businesses will be either transfigured unrecognizably or completely wiped out, and there is nothing anyone can do about it.”

Can you present strong evidence to the contrary?

I’m not saying it isn’t possible to make a good, worthy, financially successful independent film.

I’m just saying there’s no proven, valid, viable business model where it makes sense for investors to put money into it.

And in this wretched crashing economy, I think the days of the vanity, ego-driven, support-the-arts investor support of indie films are OVER.

My friend wondered what this would mean for moviemaking in the future – would this kill off future generations of talent?

In a way, I kind of hope so. A lot of movies are being made that, frankly, shouldn’t be. We can count on the talented and committed making the effort to get their stories told. Bravo. But probably 80+% of film school grads are going to be moths to the flame – poof – nobody saw that tiny flash of color, weren’t looking, and it is gone forever.

As long as I’m ranting, film school education has GOT to be one of the worst investments. Spend $100K or more to learn a craft where you have no hope of making that kind of income as a median for 10+ years. An ex-girlfriend talked about going back to grad school, and if your loans totalled what you made your first year out (about $45K in her case), it was a good balance, a good deal. So, $100K in loans and $25-$50K at best first year out? Bwahahahhaaaaa…..of, man, that hurts. Yes, that’s mean of me to phrase it that way, but Dark Mike is at the wheel today. Puppies, Skittles and Beer not on the agenda.

I’m really a post guy. I write a little bit. I have some ideas _I_ think are fun and interesting and dabble with the idea of making into a movie. Should I go for it? As a business decision, No Way. Here’s what I think might be the best possible, most optimistic outcome were I lucky and talented – I have an idea for a short film. I own a Red, a couple of lenses, enough post gear to finish out and deliver 4K DPXs for filmout (nah, 1080p is Just Fine). I’ve probably spent about $80K on gear….which I never quite really intended to get into that position, just kinda happened. But that’s another article.

If I make this one particular short, I’ll betcha I’d still end up putting $20K into it for locations, talent, lighting, travel, audio post, etc., to do something I think would make the effort worthwhile. IF I were lucky enough to get that short into a festival (while of course, short films have no marketable value), I’d probably spend another $5K on travel etc. doing the festival circuit at a level to make it fun. That’s $25K and who knows how many months of time.

Really, it’d be my expensive hobby, and I’d have to be OK with that before I proceeded on that basis.

Would I have fun doing it? Probably. It would probably lead to more stress than I expected, and take way longer and not be as fun later in the game during post, but that is my decision to make.

It isn’t so much about the technical quality of what’s possible – Red makes a damn fine image and is a great creative tool, EX-1/EX-3 amazingly good for the money (Dean Devlin shot a doc on EX-1 and seems like basically felt like F900s should F off for these applications), HVX200 and similar are, well, impressive for the little money they cost. But it is about the market. The demand. People aren’t willing to spend (much at all) money to see indie content, not when there is so much better stuff out there to be seen for free or cheap, or competing against the very little bit of free time they have.

Want to make something that works? Make something people want to watch. I have a friend trying to put together a Christmas project, and keeps saying “With this cast, wouldn’t you want to see it?” The harsh truth is…I’ve heard of the entire cast. I like many of them. I think the female lead is smoking hot, as well as talented and admirable as a human being. But that’s Still. Not. Good. Enough. There’s probably a half dozen Christmas/holiday films coming out this year.*.BUT….that said, I probably MIGHT see one of them. And even though I haven’t read the script for my friend’s project, I don’t know that I’d go see it were it made – there’s just too much other stuff out there.

This weekend – will I go see a movie? Maybe even two? Clint Eastwood and Keanu are my likely pics, but if I hadn’t seen TimeCrimes, I wouldn’t give it a second look…it looks weird, so I’d move on…

Thoughts, rebuttals, addenda?

Blast away in the Comments below.

UPDATE AFTER WRITING – this the pessimistic negative side of all this. Do I love making stuff and telling stories? Yes. I’m awaiting the first comment to tell me “If you think that way, you’ll never make it.” Maybe so – I’m feeling unusually pessimistic today. But the catch is this – for every success story that says “I just stayed true to my dream and made it!” there are probably hundreds who stayed just as true…and didn’t. We don’t hear from those boys and girls. I also have a housemate who talks about staying positive and manifesting things in your life the way you want them to be. There is ABSOLUTELY power in that statement….I’m just not in a place to harness that power today/right this minute. But there are limits to that power….that’s another entry to be written on a sunnier day, though…mike, sitting in a dark room….

…not to say we won’t have some resurgence in the future. How to make a successful indie film? Be a successful filmmaker already. Get talented cast/crew, make a movie for under $5M, which means trim WAY back on on-set luxuries, have everyone defer all fees for a future cut…and then pray – maybe your adds are 10% instead of 0.01%. But like Gill said, indie movies need to be made at indie budget levels. If it is a niche/indie play, keep in mind how big the market might be….nah, that math still doesn’t work worth a damn….

* I am even semi-responsible for taking my sister’s kids to movies so she gets 2 hours to force her husband to buy clothes for the first time in 5 years. True story! Saw Bolt!, and man, The Matrix has changed movies forever…

UPDATE SATURDAY – LOTS of lively conversation in the comments, do check’em out! Interesting to see how people define their terms. For some reason only the first 50 comments are posting, I’m getting emails about the rest, but they aren’t displaying – we’re working on it! So keep posting, they’ll all show up at once, once we get this sorted out…


Update Monday – it is interesting that some of the commenters seem to be presuming that I’m saying you should be able to get rich off of movies, Hollywood pimpin’s style. NOT TRUE. If you look at what I wrote, I’m just talking about financially viable business models – be able to sell the product for enough to pay the bills, and get the next project started. The pay being offered to most indie film efforts is abysmal at the self funded level (a few tens of thousands of dollars at best), and even working up the budget scale, the models and payouts don’t improve much. The idea of making more, cheaper movies in Hollywood (say, $10M) falls flat on its face, since advertising budgets to make the movie financially valid at a national level – you have to spend multiple tens of millions of dollars on advertising to get a decent sized audience to show up. You’ve heard of “buying the opening weekend?” – the biggest movies (think of Iron Man or Day The Earth Stood Still) dump tons of money to get a big opening weekend – because that establishes the pre-buy for the DVDs from the big distributors…and DVDs are where the REAL money is anyway…but without theatrical release, how are you going to get widely reviewed? Answers, anybody?


Mike Curtis