While streamers like Netflix, Apple and Hulu are expected to continue making big bids for the buzziest films at this year’s remote Sundance Film Festival, the still opaque nature of streaming viewership data has made it more difficult to measure whether buyers are getting their money’s worth — as an analysis of last year’s record-breaking deals demonstrates.
Obviously, the ongoing pandemic meant that any Sundance pickup that was aiming for a theatrical release didn’t see much box office revenue as older audiences that support art-house films largely stayed home. In July, Searchlight released the Questlove documentary “Summer of Soul (Or When the Revolution Could Not Be Televised)” simultaneously in theaters and on Hulu after acquiring it at Park City for $12 million, a record for a nonfiction film.
Theatrically, the film just grossed $3.7 million worldwide. By comparison, three documentaries that premiered at Sundance in 2018 — “RBG,” “Three Identical Strangers” and “Won’t You Be My Neighbor?” all earned over $10 million in limited domestic release.
Other big 2021 Sundance sales included “Passing,” a drama about a Black woman with skin tone light enough to pass as white starring Ruth Negga and Tessa Thompson. Netflix paid $15 million for the film but didn’t build much of a viewership for the project, which ranked fifth on Netflix’s top 10 most-watched titles the week of its release before dropping out altogether. (The streamer declined to provide any specific viewership data.)
An even bigger mystery surrounds Sian Heder’s indie drama “CODA,” which Apple bought for a record-shattering $25 million at last year’s festival. The film opened in theaters and on Apple TV+ on August 13, roughly six weeks before Apple TV+ was added to Nielsen’s streaming ratings system — and the fledgling streamer has released no data on the film’s viewership, though it has garnered much awards attention.
The pandemic, which has accelerated trends that were already happening before 2020, has also impacted both Sundance and the indie film market. In the latter half of the 2010s, only a precious few scripted Sundance entries managed to turn a profit at the box office. Among the rare standouts were Lionsgate’s “The Big Sick” and A24’s “Lady Bird,” which grossed $56 million and $78 million worldwide in 2017, and Amazon/Roadside Attractions’ “Manchester by the Sea,” which grossed $78 million globally as well in 2016.
But in 2019, none of the films acquired at Sundance ranked among the top 100 grossing films of the year. Park City darlings like “The Farewell” and “Brittany Runs a Marathon” failed to hit $20 million in domestic grosses. Sundance 2019’s sole presence in the top 100 was the pro wrestling biopic “Fighting With My Family,” an MGM co-production that premiered at the festival.
Now, with specialty cinemas still operating on a fraction of the revenue they had before the pandemic and doubt starting to rise over whether that side of the box office will ever again return to pre-COVID revenue levels, the Sundance market seems primed to be controlled even more by streamers looking to build their libraries as quickly as possible — and less concerned about an immediate return on their investment. John Sloss, founder of indie financier Cinetic Media, acknowledges that moving away from theatrical has drawbacks for the indie market.
“It’s true that theatrical has a better track record of building a bigger audience with how strong reviews and word-of-mouth moves faster,” he said. “Theatrical release can give a low-concept film that’s really executed well some space to breathe and raise interest over time.”
On the other hand, Sloss said the streamers are pumping more money into the indie market than ever before, using their deep pockets to put down bids that would have been seen as huge risks for theatrical distributors just a few years ago. If Netflix is willing to drop $200 million-plus to produce star-driven projects like “Red Notice” or Martin Scorsese’s “The Irishman,” then dropping $15 million on an indie film like “Passing” that is already in the can may seem like less of a risk — particularly if it can burnish the company’s prestige by winning awards.
“Between them, the content budget for the seven top streamers for this year will be around $120 billion,” Sloss estimated. “When you look at that number and at the content being released and what that money can be spent on, it’s not surprising that we’re seeing such a surge in bidding for indie distribution rights.”
How long this big spending will last remains to be seen, and likely will be based on metrics that are very different from the theatrical models of yesteryear. As Nielsen and other streaming data trackers like SambaTV build their data, analysts will get clearer data on how the top streaming titles like Netflix’s “Don’t Look Up” and “The Harder They Fall” are performing relative to what streamers spend on them.
But just as indie films released in select theaters can’t be judged by the same metric as wide releases that fill the box office top 5, indies that hit Hulu and Apple TV+ will need to be judged on their own curve beneath the levels seen by the streaming films with big stars and wide appeal. Building a transparent ratings system and a standard of success for those more niche offerings will take time.
Until then, streamers will continue to throw more and more money to sales reps at Sundance in the hopes of finding the next awards contender. There may come a point where those streamers decide that the millions they spend on five or six indie titles is better served producing one big crowd-pleasing blockbuster film or series, but until then there’s more opportunities than ever for the producers and filmmakers that get picked for Sundance to land a big sale…at least as long as they’re willing to potentially forgo their big screen hopes for it.