Two Distribution Scenarios for Successful Indie Films

Posted on March 6, 2014 by Chris Dorr

Here are two scenarios.

Scenario A

Your film gets into Sundance. Audiences love it and distributors swarm all over you.  The film gets nominated for multiple Academy Awards and it grosses over $20 million dollars. You never get a dime.

Scenario B

Your film gets into Sundance. Audiences love it but no distributor offers you a deal.   You build your own audience one person at a time using all the tools the Internet provides. As a result of two years of hard work, you earn $500,000.

You are an indie filmmaker. Would you rather have $500,000 in your pocket or nothing?

In scenario A your hard work ceases when you finish the film and a distributor picks it up.  In scenario B your hard work starts long before the film is finished and continues long after it is done.

In scenario A, you have no business control.  In scenario B you are totally in control.

In scenario A, you take on no risk.  In scenario B you take on all the risk.

You get a shot at fame or a shot at fortune.  You get one or the other—not both.

These are not abstract scenarios or simple what ifs pulled out of the air.

They are based on real films in the real world.

What drives you, fame or fortune?  The chance of fleeting celebrity or real income?

What is the plot of your film’s journey?

About Chris Dorr

I consult with companies on digital media strategy and business development. Clients include Samsung, MTV Networks, Tribeca Film Festival, Shaw Media and Canadian Film Center. I created the Future of Film blog for Tribeca. I have worked in the movie business for Disney Studios, Universal Pictures, Scott Free and in the digital media business for Intertainer, Sony and Nokia. Contact me at [email protected] or follow me at @chrisdorr
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  • http://outinthestreetfilms.com/ Out in the Street Films

    Scenario A. However, both scenarios are highly unlikely. Most likely:
    - you don’t get into Sundance
    - you don’t get a distribution deal
    - you fail to make more than $1000 self marketing

    Next possibility:

    - same except you do make some cash through self marketing but hardly enough to sustain a living

    Next possibility:

    You do get a distribution deal, but:
    - The film is hardly seen, it just languishes on a distributors slate
    - The film gets some play, but you never see a dime and it’s very obscure

    In all of these scenarios the only really take-away is that you have a film under your belt and experience, which is important to have. Do two or three more of these and

    • chrisdorr

      Very valid points, the question is, how to change the internal dynamic of the system? Can more indie filmmakers succeed at Scenario B?

      • http://outinthestreetfilms.com/ Out in the Street Films

        I think you have to negotiate that deal for yourself. Ideally you negotiate pre-sales (maybe 20% to70%) prior to production along with tax incentives (20%-30%), plus possibly soft money (grants). You would include your salary as part of the budget to pay yourself 5% - 10% as director, $45K as writer, $2%-5% as producer,

        Then you would add a cut of the profits (50% - 80%) either before or after P&A. P&A is what eats up filmmaker profits because it is unlimited or not capped. So you have to cap it or include it as part of the distributor responsibility. You may not be able to make that deal, which means you have to self distribute.

        If you have a completed film without making anything on it yet, you either sell it outright to cover your budget and tack on a percentage of profits before P&A, or you self market and self distribute for 100% of the take. The problem there is that you have to invest in marketing first.

        And the $500,000 in Scenario B is not the filmmaker’s profit is it? You have to cover your budget. If your budget was only $500K your rate as a director is likely $50K over five years at best. That’s poverty wages.

        • chrisdorr

          Good points, in my calculation (rough to be sure) the 500k is what goes into the filmmaker’s pocket. So it includes say the fee you get directly from Netflix, the money you make from selling on the VHX platform and crowdfunding on Kickstarter (they take 5%, so it is the 95%), of course they are many variations on this depending how you as a filmmaker directly sells your film to your fans and how money has been raised for the project. In one scenario the whole budget could be covered by a Kickstarter campaign (including mkting dollars) so all dollars raised go to the filmmaker. In the music business, Amanda Palmer did that with her Kickstarter campaign. No reason a filmmaker can not do the same.

  • Paul_Rand

    This is why you need to check yourself before you think you are a talented filmmaker. Are you really that good? Or are you just enthusiastic and dedicated but still a mediocre filmmaker.

    • chrisdorr

      Paul. thanks for your comment. I think you have to ask yourself if you will work hard enough to become good. Are you willing to fail and learn in order to become better?

      • Opsoclo Films

        One thing i learn, making mistakes is often consider a valuable lesson and a useful tool for one to make a wiser decision in future.

    • http://outinthestreetfilms.com/ Out in the Street Films

      Talent in film requires more than raw talent alone. You can’t sore like an eagle if surrounded by turkeys. You can’t make films with inadequate resources. You need to practice the art to realize your true talent. You need to fail before you can succeed.

      Besides, a lot of bad films are made. More bad ones by untalented people are successful than good ones by talented people. So there is effectively no measure of when and if someone is a talented filmmaker or not.

      • chrisdorr

        And I would add, there are bad films made by talented people. Even they are not exempt. And the quality of the film is often seen in the eyes of its audience, not by any objective standard. The question is how to get the audience that will respond positively or at least let the filmmaker know s/he did not hit the right spot this time, but could next time.

      • george

        It’s “soar”.

  • Opsoclo Films

    Scenario A: It establishes a name for you in film industry only if you’re newcomer. But if not, something is wrong, and it needs to fixed.

    Scenario B: You build your own audience, this will not only teach the filmmaker how the industry works (distribution) but gaining a whole lot of knowledge about how to attract more audience and maintain it. It will help him latter.

    It’s a quiet an issue but it depends on the current atmosphere of the industry and the filmmaker, if he fully notice what’s going on around by reading industry experts article’s and blog’s such as this blog and Ted Hope’s.

    • chrisdorr

      Thanks for your comment. Very well put.

  • FilmmakerA

    This really is the worst kind of article. For starters, with scenario A, if there really is that much interest, you’re going to get a very sizable advance. Scenario is B is completely unrealistic, and can only be put forth by people who have no inkling about the actual costs and expenses and revenues of film distribution. Frankly, these types of articles do more harm than good.

    • chrisdorr

      Do I believe these are the only scenarios? No, but they are real ones, that filmmakers can face. Can a film with interest get a sizable advance? In very rare cases, yes, but that is declining. Also, it is very rare for the filmmaker to see anything beyond the advance, even if the movie does well. Scenario B is actually based on a real film-it is not based on a fantasy. It has also happened more than once, just not enough as it should.

      • FilmmakerA

        But what you’re doing is highlighting two rare situations - but picking the worst case for traditional distro and the best case for DIY, and then saying, go ahead and choose. It’s dishonest. Most films fall far between these two. And even worse, youre not mentioning the money and time one has to spend for DIY. As someone whose done it and lost a lot of time and money, your “easy choice” scenario is really dangerous and irresponsible.

        • chrisdorr

          Point well taken. I would also say the the tools of the Internet-if applied well and judiciously-take time but not a lot of money for filmmakers who want to build an audience. This was not true even 5 years ago. (I don’t know when you spent your money.) The scenario B I use was very recent and the filmmakers did use those tools very effectively. They did not spend a dime on a theatrical release yet their film went into theaters. They raised money from a crowdfunding campaign-no cost-but a lot of time. In other words in Scenario B you can build an audience one person at a time at a very low cost-and if your film does not take hold-you have not lost a lot of money-just the opportunity cost of your time. In Scenario A, you get fame but no money-and yes, that fame may have value for your next project, but it brings you no money from the film you have made-and more importantly-you have no direct connection to a sympathetic audience that awaits your next project.