Executives say the recession has been a healthy correction, clearing away excess and leaving deals that were smarter and realistic
For all the recession-led moaning ahead of the Cannes Film Festival, the film business appeared to be alive and on the upswing.
Across the board, Hollywood dealmakers in Cannes said that business was brisk, from international sales in the marketplace to new private investors looking to place money in filmmaking to institutional financiers returning to the game.
Union Bank of California and Comerica came in force. A New Jersey billionaire looking to get into the film industry cut a swath, serially holding court with film producers who were eager to sign up for his cash.
“We’re seeing the first sign of health come back to the market in 18 months,” said Graham Taylor, co-head of Endeavor Independent. “You have to walk before you can run, but it feels like we’re starting to see upticks that will strengthen over the next several quarters.”
That’s not to say that the economic downturn wasn’t noticeable. Vanity Fair’s bash was cancelled, and by all accounts hotels were a bit less crowded, reservations slightly easier to come by.
But like the premonitions of doom ahead of this year’s Sundance Festival, Cannes turned out to be a place where people did business. Weinstein Company executives said they closed $50 million in foreign sales at the festival, not including those for its upcoming star-studded, musical extravaganza, “Nine.”
Sony Pictures Classics bought no fewer than three films, including the Palme d’Or winner “The White Ribbon,” the crime thriller by director Jacques Audiard in Arabic, French and Corsican, “A Prophet,” and the story of a love affair between, as the title suggests, “Coco Chanel and Igor Stravinsky.”
In every case, executives said buying prices were very modest, in the $200,000 to $300,000 range.
“I think the whole marketplace underwent a major correction,” said Jonathan Sehring, President of IFC Entertainment, who also bought several films. “I think you truly got the best films ever coming out of Cannes. We bought two that have the potential for making money.”
IFC bought “Looking for Eric,” a warm comedy from Ken Loach about a middle aged British postman visited by an apparition of the soccer star Eric Cantona (many said the film would have to be dubbed, or subtitled, in English, to be understood by American audiences). Sehring also bought “Antichrist,” an experimental and hotly debated film by Lars von Trier. Both will be released in late 2009 or early 2010.
There was similar enthusiasm among sellers.
“We’re very excited, we’re selling out our international,” said a senior Weinstein executive, who asked not to be identified. “People are buying movies one year out, and one and a half years out. Our buyers want more product.”
Taylor said Endeavor’s 25 or so films closed between $140 and $170 million in business at the festival.
And there were hints that a couple of hedge funds – out of the game since the cataclysm on Wall Street – would be stepping back in the film financing businesss by summer, according to executives involved in those deals, which have not yet been finalized.
Most film executives said that the economic recession had been a healthy correction for the marketingplace, clearing out a lot of underbrush and excess. The deals that were left, they said, were actually more straightforward and smarter. Agents are more realistic about star salaries, the investors left in the game are more sophisticated about the business.
"Gone, for all of us, are the days when movies are made by filmmakers that don't have an audience," said Sehring. "The producers out there are a lot more realistic."
True, the major studios weren’t buying (“Dead,” was the terse email that came back from one major’s acquisitions chief), but that has already been the case for many years.
Many competition films, including Quentin Tarantino’s “Inglourious Basterds,” and Pedro Almodovar’s “Broken Embraces,” already have U.S. distribution (by Weinstein and Sony Classics, respectively).
The social scene was far from dead this year too. Every night the sound of music blasted across the Croisette, from yachts in the harbor to the Vitamin Water tent on the beach. Universal put on an old-fashioned dance shebang for “Taking Woodstock,’ with a cover band playing The Who and Crosby Stills, Nash and Young to a packed house.
Anvil, the heavy metal band, put on a packed concert in a Cannes nightclub. Microsoft co-founder Paul Allen still had his blowout party on his Starship Enterprise-sized yacht, where he played guitar with a cover band for his guests.
Only AmFar really showed its age with its annual event in the ultra-exclusive Cap d’Antibes; the fundraiser for AIDS research attracted fewer stars and raised just $4.5 million, compared to $10 million last year.
Charities are hurting all over. And perhaps AmFar — which had its heyday in the early 1990s — is a bit past its prime.
“To me, it was a great festival,” said Endeavor’s Taylor. “We stripped out a lot of the white noise. We did business all day, every day, with no distractions.”