Don’t Kill Your Movie: Avoid Deadly Mistakes with Distribution Deals (Guest Blog)

There is a woeful lack of knowledge by so many independent producers and directors today, who make crucial yet avoidable mistakes in the distribution of their films

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This then results in little revenues for their movies. Not a week goes by without my hearing a complaint from someone who’s earning minimal money from their recently released film.

What are three of the crucial mistakes?

1. Signing Bad Contracts
I’m not going to sugar-coat this: Too many producers and directors sign horrendous contacts with distributors. Yes, I understand that most who make movies and documentaries are not business people — of course they’re not, they’re creatives. But if one wants any semblance of a career and to keep making content, you have to see revenues actually come back to you. Otherwise, it ends up being a hobby while you continue to work a day job.

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What’s the solution? First of all, read every single contract yourself and understand what’s in them. Whatever you don’t understand, have your attorney explain it to you. Eventually, you’ll be able to understand these things with one read-through, as well as recognize when important things are missing. Secondly, have a good entertainment attorney who will ALSO be reviewing the agreement. And not just any entertainment attorney, but one who knows distribution agreements. Really knows them. This is an important qualifier. You’d be surprised how many attorneys will miss things in such contracts, which then come back to bite you. So please don’t hire your attorney cousin who does a little production legal on the side of his Marriage Law practice.

Lastly, there’s a list of about a dozen crucial items that must be addressed in every distribution contract. When you get that “boilerplate contract” from a prospective distributor, I guarantee you that a number of these crucial items will NOT be in that agreement. (Such as Expense Caps.) You must know what all of these items are — for your protection — and get them into any contract. Additionally, you cannot rely on your entertainment attorney to be sure these are all covered; know what they are yourself so that you and he/she can discuss and negotiate them with the distributor.

2. Not Understanding VOD Today
Video on demand is a growing market in today’s landscape. Unfortunately, too many independent producers and directors don’t really understand this market — as well as the necessary ingredients to increase sales and have success here.

For ease in understanding — as well as strategic purposes — VOD can be broken into two market segments: 1) Internet VOD, and 2) Cable/Satellite/Telco VOD. Internet is those platforms such as iTunes, Amazon, Hulu and so forth, that most everyone understands today. Cable/Satellite/Telco (short for “telephone company”) are all those systems that mostly pre-date the internet platforms, such as Comcast, Time Warner, Cox, DirecTV, Dish, AT&T, Verizon, etc.

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It’s important to delineate between these two segments, in order to understand that marketing and increasing your sales typically means a different set of strategies that need to be deployed. The “one size fits all” approach rarely works in reaching your audience in both of these market segments. Unless you’re a studio, of course, and can spend tens of millions of marketing dollars. But even then, they’re employing different strategies and techniques in each market, from theatrical down to internet.

Unfortunately, many independent filmmakers today don’t understand any of this, and then wonder why their movie makes no money (or little money) when available on Comcast for 30 to 90 days. Clearly this hurts, because the Cable/Satellite/Telco VOD space accounts for 77.5% of ALL movie revenues earned through VOD. Internet VOD only accounts for 22.5%. That’s a significant revenue difference of more than triple. (Stats courtesy of The NPD Group.)

So what is a typical producer or director to do? In my next article, I will discuss specific strategies that should be utilized in today’s marketplace to increase sales on Cable/Satellite/Telco VOD.

3. Lack of Follow Through
This is going to sound silly to some, but many independent producers and directors today do not follow though with their movies, beyond signing a contract with a distributor. They make a deal, deliver the movie, and then leave everything in the hands of their distributor(s). Why would you do this?

The only valid reason for doing this, is that you have a good relationship with your distributor (meaning you have worked with them before), they do a great job and you always make money. Bravo, you’re one of the lucky ones. What happens more often than not, however, is a deal is made, the producer or director moves on to their next project, and the distributor doesn’t do a good job. And once a film has been released, you’re now trying to play catch-up if things haven’t gone well. Which is a difficult, if nearly impossible thing to do.

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Now if you’ve received a healthy advance on your film, and/or you’ve had pre-sales from international, then maybe you’re fine with whatever happens. But barring that, producers really need to be more involved today, from understanding who your audience is for your film, to how you’re going to reach them — and then actually doing so. Ideally in partnership with your distributor(s). The marketplace has changed SO much, that many distributors are (forgive me) “old school,” and don’t understand how, for example, social media can play a huge difference in sales for a movie or documentary.

And then there are many distributors and aggregators out there, who play the game of “Throw the movie out there and let’s hope it hits.” Seriously? Why would any producer today take that gamble? The marketplace is glutted with content, the typical consumer has more options for recreation today than ever before, and too many distributors have not caught up with the times. On top of that, you’ve presumably spent at least two years and considerable money on your movie, so walking away after the contractual ink is dry is a mistake. You might as well have just gone to Vegas and put it all on black at the Roulette table.

Bottom line is, unless your distributor has a good track record for you, you need to be involved in the distribution strategy that will be employed, including participating in the lead up to, and through the release.

Is this the fun part of making movies?? Not for most. But it is absolutely crucial today for increased success.