Wednesday, August 15, 2007

IFC Flopping and Flailing (and media buying it)

IndieWire and Variety (and others) report today that IFC is abandoning its plans to release bigger budget indie features and focus instead on IFC First Take. IFC touts this as a simple strategic shift with IFC Entertainment Pres Jonathan Sehring telling IndieWire that IFC is "sticking to its core" by "focusing on niche titles or, 'providing independent films with the strongest vehicle and the broadest reach possible.'" IndieWire essentially reports this matter of factly, and fellow blogger Sujewa even asks " are such initiatives the revenue & awareness future for real indie filmmakers?

Dear God, let's hope not. With all due respect to my friends Sujewa and IndieWire (and even those I know at IFC), I think its time to call bullshit on all of this IFC malarkey. First, IFC is essentially announcing a failure - they're either not capable of releasing these larger films or someone at the company, probably above Mr. Sehring, has pulled the plug because these films aren't profitable or don't fit the company's overall strategy, which is cable. IndieWire notes that You Kill Me has pulled in about 2.4 million at the box office - ahem, subtract marketing costs, etc and that there is a failure. A marketing campaign, sure, but not a success.

IndieWire reports further:
"There are more distributors for films in the 5, 15, 20 million budget range," noted Sehring in today's conversation with indieWIRE, adding that competition for those films has become more intense, while "truly independent films are left without a sustained distribution mechanism."

Read: We can't compete, and might as well use this as a way to spin IFC First Take as some smart strategic move. Sorry, but I'm not buying that they feel so bad for "truly independent films" that they decided to stick to their core and work only with those films. More likley, First Take allows them to convince producers to sign over their film to them, getting it on VOD, which the cable operators want. Cable operators are telling places like IFC and Sundance (and others) that they want VOD offerings. And Yesterday. This doesn't mean anyone's making much money off of VOD, but the cable operators (Time Warner, etc) need to be able to tell consumers about all the great VOD offerings they have so that consumers bother to pay their hefty cable bills each month.

Note the word-parsing IFC must use to make IFC First Take sound like a success. IndieWire reports:
Meanwhile IFC First Take is flourishing, according to those at IFC and Rainbow. According to the company, the bi-monthly releases are available for download by some 40 million national cable TV subscribers when those titles are simultaneously relased in movie theaters.

Excuse me, but "available" to 40 million subscribers is a worthless figure. IFC keeps spinning, as if their life depended on it (hint hint):

"The growth of this service [known as IFC In Theaters on national cable systems] from zero to forty million in about a year is pretty much unparalleled," Rainbow spokesperson Matthew Frankel told indieWIRE this afternoon, citing the widespread availability of IFC First Take's films to subscribers of DirecTV, Comcast, and Time Warner Cable, beyond just Rainbow parent Cablevision. While not releasing specific download numbers for the First Take films, he noted, "And in regard to the films, we are very pleased with the kind of demand for this small independent film -- not only are these films available in Des Moines, Iowa but people are actually buying them in Des Moines, Iowa."

All this means is that four cable systems wanted to offer VOD, and IFC needed to suck up to them all in order to remain being carried on these services. IFC needs the cable operators more than they need IFC, and while a kid renting a film in Des Moines via VOD is great for Des Moines, its not ground breaking news. If Frankel was so happy with the numbers, perhaps he would have shared a few of them with us!

If you look at The Numbers (the website), you find First Take having a total gross from 1995-2007 of just $1.14 million, from 17 films for an average gross of $67,000. For comparison, much-less well known First Run Features has had a collected gross in the same time of $3.32 million (but with an average $46K per film) and Koch Lorber has averaged over $100K on their films in this same time. Parsing the numbers is never easy, and I can't vouch that The Numbers has these right, but IFC First Take has definitely gotten more press than it deserves for "helping" indie filmmakers. While none of these numbers include DVD or VOD sales, no one is reporting them to us in any easily decipherable manner. Bottom line - no one is making much money, but IFC can't call First Take a success without backing it up better than they have thus far.

Indies shouldn't look at First Take as a model for anything other than what it is - a strategy for a small cable channel to keep getting carriage on big cable systems. While VOD will impact the business, and indies should keep it in mind, my money says this isn't the player to watch. I'd love to see a better analysis of these numbers and the entire marketplace for smaller film distribution than I can offer here. I'm not picking on IndieWire or Sujewa - both are also small players trying to make sense of this - but someone needs to look further into this than they, or I, have been able to do. It's about time indies start getting some real numbers, solid advice and possible solutions instead of pr spin, party photos and bad distribution contracts.

[UPDATE: I stand by this info overall, but a friend pointed out that The Numbers doesn't list everything. See IMDB, for example. There's probably some overlap with the IFC Films numbers, but I can't be sure. Overall point stays the same]

10 comments:

The Sujewa said...

Good questions there Brian. More -& accurate - figures are definitely necessary in order to figure out if First Take is a very good option for a movie.

However, if the "available for 40 million" First Take figure is true, then, a desirable (by customers) & well promoted movie does stand a chance of getting a lot of customers through First Take. How much of that revenue goes back to the filmmaker is another question.

Good theatrical distribution is still goal #1 for me as a filmmaker. However, other streams of revenue & exposure are always useful - thus what I heard about First Take from yesterday's iW article is interesting. Of course more info. is necessary, and even then, it will have to be a project by project evaluation to see which combination of distribution options will work best for which movie.

- Sujewa

The Sujewa said...

Check this article out Brian:

http://multichannel.com/article/CA6439359.html

It estimates 1st 13 or 15 First Take films generating about $5 million in gross revenue.

- Sujewa

The Sujewa said...

Here's the exact line that I am referring (sp?) to in the comment above (it's not 13 or 15 films, but the first 13 months):

"For IFC, the first 13 months worth of films generated 1 million viewings. At an average price of $5, that's only $5 million."

Read the article at the URL posted in comment above.

- Sujewa

BNewmanSBoard said...

I'm still not buying it. Again, they are conveniently conflating numbers. What the article actually says is that not every home is paying $5.99 a film, many are paying $4.95 per month for unlimited viewing. I have no idea what percentage is paying-per-view vs paying a monthly fee, but I'd be willing to bet more people opt to pay only $4.95 a month for unlimited VOD. I know I would. How that gets divided up amongst multiple distributors, I have no idea, but I'd hazard a guess it isn't in the producer's favor.

Even in the hypothetical example they give of 150,000 viewings of "Unknown," they say that could be at 5.99 a pop. Probably not, but even if so, that means the gross was about $900,000. Net to producer - I don't know, but rumor has it that IFC pays 50/50 after expenses. And after expenses can mean a lot of things.

Last, "available for 40 million" may be true. That doesn't matter. I am one of those 40 million because I have cable, and I've never looked at any VOD offerings. If you put your film on Amazon, you are available to 65 million - you don't really have a bigger audience, just a chance that they could download you if they want your film. My math shows that if 150K watched this film, out of 40 Million homes, you have 0.4 percent chance of being watched. Any way you cut it, these numbers don't add up to me.

Eugene said...

What's missing in all of this is details on the actual numbers of VOD downloads. That would tell us more. In my conversation with IFC yesterday, I asked for those numbers and will continue to push, now that I understand the situation better.


People at IFC tell me that they cannot easily provide those numbers because many of them are proprietary numbers for other cable systems. IFC can apparently only choose to release Cablevision figures. The implication was that with more time, I should be able to get some figures from other systems so that we can see the whole picture. So, I am trying to do that.

Not for attribution, people are telling me that the numbers for some films are significant and are resulting in sizable checks for filmmakers who have participated in the program because of the favorable splits that IFC has been making with filmmakers in exchange for low/no upfront money. Will they continue to do that? I was just told this yesterday and felt it was not right to report it without confirming that, so I still have to verify it.

I was careful not to build my story around the 40 million figure and tried to explain that this is only access. But, in fairness, having those films accessible to more subscribers is the first step, if those people are actually buying them and then the we'll start getting a better idea if this is a viable model.

I think you are asking the right questions and I will keep asking them as well until we can get more clear answers.

Still more work to be done here to really understand the situation.

The Sujewa said...

Brian,

If IFC does actually do a 50/50 revenue split after reasonable & verifiyable expenses (probably so, otherwise we would have heard from some disgruntled producers by now),then, First Take is a very useful program for ultra-low budget indie filmmakers (let's say people who make their movies for $20K or under to around $200K). Even without all the figures being in, the existence of the program as an option feels like an improvement in the overall indie film distribution picture.

Also, let's keep in mind that the program is less than 2 years old, and they, like all other distributors, have to work with whatever the filmmakers have created in a given period (meaning, the fault for low receipts might not always lie on the distributors corner, even if the distributor has done everything right, success depends on the film and the mood of the audience at a given point in time).

At this point I am willing to give First Take the benefit of the doubt 'till we see what more info. can be figured out re: actual performance. I like a lot of the the titles they have chosen and I have seen a couple on my TV.

Also, like Eugene said, the "available to 40 million" is significant, think of it as 40 million stores that are willing to stock your book or DVD. With that element in place, IFC or others can advertise and make potential customers aware of the fact that a certain film is easily available for them to buy. Individual titles & amount of promotion will determine how many downloads/purchases happen. But before we get to that point, the product must be available - that's why the "40 million" figure is important & is a significant achievement. It is not the same thing as Amazon, because, when, as a customer, I sit down in front of my TV & look to see what kind of movies are being offered to buy & watch one, I am ready to watch a movie, I can have the product & the experience in a few seconds. With Amazon you have to place an order for the DVD & wait for it to show up & then find a time to watch the movie. Also, First Take movies are cheaper than buying a DVD.

Let's also not forget what the performance standards - revenue wise - has been for the genre of movies that we are discussing; Stranger Than Paradise, She's Gotta Have It, The Living End, Slacker, and Clerks are good examples to look at. Most of them earned less than $5 million theatrically when they were initially released. Now that most other theatrical distributors, for the most part, do not pick up ultra-low budget, no star, "experimental" or "fringe" movies as the ones mentioned above, First Take might be a good options for some filmmakers.

Let's see what Eugene digs up, actual First Take numbers wise. And, once more, I think the "40 million" availability number is a good thing. The right movie & the right marketing can turn that into a lot of cash.

- Sujewa

-Ira said...

The best sign that IFC's program is successful is that it still exists. If it wasn't creating significant revenues, the cable systems would have abandoned it by now, and IFC First Take would be no more.

And one more thing, when a company like IFC says that they want to refocus on smaller movies that are in need, don't confuse that with altruism. A need in the marketplace is an opportunity for a company that wants to exploit that need. Why bang your head against the wall trying to compete with other companies when you can own a nitch? Seems like smart business to me.

mary said...

Just one correction:

Both multichannel.com and the-numbers.com forget to mention one important movie from IFC First Take:

IFC First Take has released "THE WIND THAT SHAKES THE BARLEY", which grossed $1.83 million in its US theatrical release.

http://boxofficemojo.com/movies/?id=windthatshakesthebarley.htm

JC said...

To the filmmakers out there:

Regardless of whether IFC's First Take is successful or not, if you have an opportunity to get your movie onto various cable systems' VOD, particularly after a theatrical release of some sort or a home video release, you have the potential of seeing some decent added revenue to your bottom line. And revenue that was essentially non-existent a couple short years ago (except for PPV).

No, no one is going to get 40 million households to buy their movie for $4.95, but one can stand to gain an additional $30,000-$100,000 from VOD for the typical "no-name" narrative feature. (More for a genre movie or good seller.) It doesn't matter what your budget was in making it, contrary to another's comments here (with all due respect).

VOD is a good source of extra revenue right now; get it while you can, who knows how long VOD will remain viable for. Maybe a long time, maybe not.

JC
---------------
"The Secrets to Distribution: Get Your Movie Distributed Now"
http://www.Distribution.LA

Anonymous said...

Does anyone out there know roughly what IFC or other cable channels pay indie filmmakers to show their films?

$1,000? $10,000? Do filmmakers just get paid one fee or do they get paid every time the channel screens their film?

Any info would be greatly appreciated