by Lauren Bates, Megan McNally, Xiaodan Meng
Intro
Every aspect of media is constantly undergoing change to adapt to new standards and formats brought about by new technologies, ideas and concepts. The field of film distribution is no different when it comes to adaptation and evolution in the ever-changing entertainment industry. The traditional role of film distributors is akin to the role performed by sales agencies whose main objective is to sell theatrical releases to theaters and then subsequently distribute the films for VCR or DVD releases. No longer is distribution limited to those two mediums nor does the distributor have to be a large agency or studio. Over the past six months, there have been new developments in film distribution to theaters, the Internet, DVDs as well as who is distributing films and the ways in which they do so. The key concept is that distribution needs to be able to adapt to ever-changing times and technologies; it must undergo evolution, not revolution.
Fall 2011 Film Distribution Timeline
Theatrical Distribution
Theaters everywhere are saying goodbye to the traditional method of displaying movies. High definition digital projectors are now replacing film reels, which were once the norm in theaters everywhere. The reason for this shift is quite logical. Moviegoers want to see films in the best quality possible while, at the same time, distributing films in a digital format tends to be more economically efficient than creating and distributing reels to theaters. A print, which is a copy of a movie in its film format, is sent to all theaters that intend to screen a movie. Prints can cost up to $2,000 before considering the cost of maintaining, mailing and recovering the prints from distribution points all around the world. Another contributing factor in the high cost of production of celluloid film is the sky-rocketing price of silver, a key material in the manufacture of film. For these reasons, distributors are opting to send new Blu-Ray DVDs to theaters with digital capability – a method that saves considerable time and money on the distributor’s end. To illustrate this trend, in 2004, traditional film projectors carried the load in more than 99% of all theaters. However, by the year 2010, that number had dropped to 68%. This trend is gaining further momentum as current forecasts indicate that the presence of film projectors in theaters will drop below 37% by the end of this year, relegating the use of film reels to a niche status by the year 2015 when projections indicate that only about 17% of theaters will make use of traditional projection. The technology is evolving rapidly so distributors and theaters alike must adapt to the standards demanded by both movie producers and consumers, i.e., the format for the distributors of films must refashion its platform to suit economic and technological needs.
Online Distribution
Though movie theaters are remodeling their viewing platform, distribution has also taken movies to “The Cloud.” Distributors and independent filmmakers are now embracing the web. Once a threat to the film industry, the web is now seen as a viable option as distributors have chosen to distribute their films on various websites. Over time, theater attendance has been on a gradual decline due in large part to on demand movie capabilities through cable television and services such as Netflix. While Netflix pioneered online movie watching, new websites and design platforms are taking the world by storm. Among them, a new site, EZtakes, is attracting both big name distributors as well as independent filmmakers. This new online movie site allows viewers to rent films or download (independents and blockbusters alike) to their computers for long-term possession as well as for rental purposes. Unlike with Netflix, users can burn DVDs of the movies they purchase and most films are available in an .mp4 format, allowing users to make their purchases on mobile devices such as smartphones and tablets. EZtakes is not a subscription service as viewers must pay on a per movie basis but the price does seem to be 50% less expensive than the original shelf prices. With the popularity of online services increasing, distributors are bypassing theatrical releases and going straight to online services such as EZtakes where they can also purchase advertising space to promote their movie within the site. This method has proven to be economically beneficial both to the distributors and site owners since the cost of advertising is less expensive than large scale marketing for distributors and EZtakes is gaining revenue through advertisement sales.
DVD Distribution Developments
Many distributors are trying to find a way to attract consumers to purchase DVDs off the shelf rather than turn to Netflix and other online sites for rentals or streaming. A trend is now catching on with distributors who are selling big name films in the DVD retail market: limited release periods. Warner Bros. Entertainment announced two weeks ago that it would stop shipping copies of the last installment of the Harry Potter franchise along with the entire series as of Dec. 29, 2011. Though customers theoretically will not be able to purchase the films after that date, Warner Bros. will most likely release special edition versions in the not too distant future. For its part, The Walt Disney Company, the pioneer in limited releases, has used this tactic with great success for many years. Big name blockbuster movies such as Beauty and Beast, Sleeping Beauty and The Lion King have been released and re-released for all to purchase within limited time frames. Though Warner Bros. does not have the luxury of owning as many popular classics to distribute time and time again, the Harry Potter franchise may be their first great opportunity at distribution gold. According to Entertainment Weekly, $5.1 billion of the $12.1 billion that Harry Potter has raked in for Warner Bros. has come from the home entertainment department of the company. Therefore, home entertainment is a huge market for their distribution company.
This new distribution model creates a demand for the films and preserves the timeless quality that might not exist were the films to stay on store shelves indefinitely. Removing the Harry Potter franchise from the hands of retailers at the end of this year should prove to be a very successful tactic for Warner Bros. The timing of the studio’s press release was no coincidence. Warner Bros. is hoping that it will encourage buyers to purchase Harry Potter during the peak spending period of the holiday season, especially when the limited time exclusivity is dangled above their heads. Although people may be able to purchase the film through an online download or watch it by way of a television streaming services, most consumers know full well that the HD-quality visual experience provided by DVDs is far superior to any other format.
New Forms of Distribution
In the wake of new technologies and the push toward servicing independent filmmakers, a new era has arrived in the world of distribution. With his controversial manner of distributing his recent film, Red State, Kevin Smith perhaps best exemplifies the power of the independent filmmaker on new means of distribution. Mr. Smith first premiered his film at this year’s Sundance Film Festival where he told distributors that he would sell his film to the highest bidder but then turned around and purchased the horror flick himself. Of course, this move irritated those he deceived but Smith managed to offend them all the more with the method he used in distributing Red State. Instead of distributing the film to theaters for a nationwide theatrical release, the acclaimed director decided to take his movie on a tour where he would pay a price to rent out theaters and set his own ticket prices, thereby pocketing the profit and directly bypassing the middle man along the way. This technique is known as four-walling. Smith was successful in his venture as his reputation alone was enough to attract crowds who were willing to pay the steep price of $50 per ticket. Though four-walling is not a recent invention, its use as a distribution method is becoming more commonplace with independent filmmakers. However, there are dangers within this system, the largest of which is that the filmmaker/distributor is taking on all the financial risk. Additionally, it would be harder for first time filmmakers to distribute a film using the four-walling method since four-walling is far more likely to be successful if a “big-name” were attached to the film – a luxury only few filmmakers possess.
Conclusion
Though this has been a brief snapshot of the developments in the film distribution industry over the past six months, the future of distribution is unsure. All means of distribution rely heavily on the technology present; with each new technological development, the distribution industry faces opportunities and challenges. As beholden as they are to technology, distributors are also heavily dependent upon the consumer. The consumer is their main priority and distributors must cater to the way they respond to the products they are distributing. Though film distribution occupies a less than glamorous segment of the entertainment industry, it holds a great deal of leverage and financial importance for every studio and filmmaker.
Please click HERE to see the interactive timeline of current film distribution developments.
New Forms of Distribution
In the wake of new technologies and the push towards the independent filmmakers power, dawns new distribution strategies. Kevin Smith and his controversial manner of distributing his recent film, Red State, perhaps best exemplify the power an independent has on new means of distribution. Mr. Smith first premiered his film at this year’s Sundance Film Festival where he had told distributers that he would sell his film to the highest bidder, than purchased the horror flick himself. Of course this upset those he deceived, but Smith managed to upset more with how he went about distributing Red State. Instead of distributing the film to theaters for a nationwide theatrical release, the acclaimed director decided to take his movie on a tour where he would pay a price to rent out theaters and set his own ticket prices where he collected the profit directly, thus omitting the middle man in the payment process. This technique is know as four-walling. Smith was successful in his venture, for his name alone was enough to attract crowds who were willing to pay the steep $50 ticket. Thought four walling is not a recent invention, the use of this distribution method is becoming common place by independent filmmakers. However, there are flaws with this system, with the largest one being the gamble of losing profit. It is harder for first time filmmakers to distribute their film using the four walling method, for four walling is only successful if there is a “big-name” attacked to the film – a luxury only few filmmakers have.
Conclusion
Though this was a brief snapshot in developments of the film distribution industry within the past six months, the future of distribution is unsure. All means of distribution relies heavily upon the technology present; with each new technological development, the distribution industry faces opportunities and challenges. As reliant as they are on technology, they are also heavily dependant on the consumer. The consumer is the main priority and must cater to the way they consume the products they are distributing. Though film distribution is a small part within the entertainment industry, it holds a great deal of monetary importance for the studios ad personel they are representing. Please click HERE to see the interactive timeline of current film distribution developments.