Delivering the Los Angeles Film Festival's keynote address, Cinedigm CEO Chris McGurk points to seven signs of a coming independent film boom
Cinedigm CEO Chris McGurk said nay to the Hollywood naysayers at the Los Angeles Film Festival on Saturday, using his keynote speech to say that the movie-business prophets of doom are wrong, and that the industry is in fact on the verge of a renaissance in independent film.
"Time and again, we’re told by the Sky is Falling folks that film is an antiquated experience that’s being crowded out by all the new entertainment options that keep emerging," said McGurk, who founded Cinedigm after 25 years at MGM, Universal, Disney, Anchor Bay and other entertainment companies.
"[But] I will confidently predict that we are about to see cinema history repeat itself yet again. In the past, whether it was the arrival of sound or TV or home video, each time new technology came on the scene, it was initially viewed as the enemy.
"Instead, each time it led to new paradigms of success. I am confident that the same will be true of digital technology, and the sky will continue to remain right up there where it belongs … An Indie Renaissance is indeed on the horizon."
McGurk focused his speech on what he said were the seven signs of that renaissance, and positioned it as a rejoinder to recent LAFF keynotes that, he said, "pretty much said that the world of independent film was coming to an end."
Previous speakers, he said, foresaw disaster for indies because of competition in the home and on mobile devices, because of small studios going out of business and majors closing their indie divisions and because of the steep decline in DVD sales.
"We are fast approaching a time that, in important ways, is reminiscent of the previous two great flowerings of independent film," McGurk insisted, citing the artistic boom of the late '60s and early '70s and the golden age of indies in the late '80s and early '90s.
The first, he said, was fueled by cheaper, more portable equipment, the second by the increasing number of distribution outlets on cable TV and home video.
And both booms, he added, were helped by major-studio business models that were collapsing – just as they are now, when "tentpole film productions routinely run $250-$300 million, with marketing costs to match" and "even major blockbusters are only generating single-digit returns." When one of those films fails, he said, "the write-offs can be devastating, and we have seen a couple of instances of that recently."
His seven signs of the impending indie renaissance:
"The Production Revolution."
"Today, equipped with a Red camera and a computer, any filmmaker can cheaply and quickly produce a motion picture suitable for theatrical release."
"The Distribution Revolution."
Digital distribution into theaters, which is expected to be possible in 90 percent of all North American theaters by the end of the year, is making delivery faster and cheaper. At the same time, digital distribution through home and mobile platforms creates "an exploding demand for filmed entertainment."
One success story: “Margin Call,” which "cost $3.5 million to make and took in $4 million on VOD, $5 million in domestic theaters and another $5 million internationally. So it was solidly profitable before it even went into other ancillary markets — something that rarely happens with major studio releases."
"Big talent is into small films."
With the studios cutting back on the number of releases, and focusing on franchise films that may not be artistically satisfying, McGurk said actors and directors are willing to work for less money in the indie arena, which "increases the viability of independent films."
"Exhibitors want independent films … desperately."
Theaters, he said, see about 85 percent of the seats go unsold each year, and are so anxious for new product that two chains, AMC and Regal, partnered on their own indie studio, Open Road Films.
But McGurk warned that exhibitors may have to revise their strong opposition to any attempt to shorten the windows between theatrical and video release. A more flexible approach to shorter windows for indies that do not receive wide releases will, he said, "open up their doors to a whole new stream of independent content" that might otherwise go straight to DVD.
The success of live, digitally-delivered Metropolitan Opera productions and the weekend-matinee Kidtoons series is proof, said McGurk, that theaters can be successful "by precisely aligning content with avid audiences in a communal setting."
Crowd-sourcing platforms like Cinedigm, he added, can help theaters determine where the audience is and what they want to see.
"The new narrowcast release strategy, combined with the kind of creative windowing we saw with 'Margin Call,' will get filmmakers access to more eyeballs under an economic model that is more likely to generate real rewards."
"Those of you who bought the Facebook IPO, hold on to your stock," said McGurk. "Social media is still the future" – in this case, for movie marketers who can take advantage of the fact that while people don't want to watch commercials online, they do like to watch movie trailers and ads.
"More dollars. And, by the way, more euros and yen and pounds and pesos and rubles."
The hopeful signs that exist in the U.S market, he said, also exist in the international market.
"All of these add up to a more profitable business, which inevitably adds up to a more productive and expanded business," concluded McGurk.
"Which means that, as in the first golden age of independent film that started in the late ‘60s and in the second one that started in the late ‘80s, all of you movie lovers will have more movies to love at the multiplex, or on your TV or your computer or your iPad, or other devices yet to come that will provide even more digital canvasses for today’s cinematic artists."