This week the 25th annual Sundance film festival kicks off in Park City, Utah. But thanks to the economic downturn and the fact that last year's pricey Sundance purchases bombed at the box office, this year is going to be looking a bit chilly.
Yes, the week will still be packed with parties, corporate sponsorships, and late night meetings between buyers (movie studios and distributors) and sellers (independent filmmakers). But for the 118 full-length features and documentaries premiering at the festival, it'll be a lot harder to close a deal, and the prices will certainly be a lot lower this year.
First, there are many fewer buyers and they've got less to spend.
In the past year a number of the film industry's specialty divisions-- the very arms that buy and distribute independent films -- have been shuttered or folded into larger studios. Time Warner's Warner Independent and Picturehouse singles are gone. Paramount Vantage's operations are being combined more into its parent studio, Viacom's Paramount. Universal's specialty division , Focus Features, Fox Searchlight and Lionsgate are making a point to produce more of their own films and make fewer acquisitions.
Needless to say, with financing from Wall Street tight, everyone is being much cautious about acquisitions.
Every year until now Sundance sales have continued to creep up in price--without correspondingly strong performance. "Hamlet 2" was bought by Focus for $10 million and only brought in $5 million at the US. With other Sundance films that got distribution, including "American Teen" and "Choke" disappointing at the box office, there seems to be little reason for the studios to get into bidding wars this year. And even if good content earns distribution, the price tags are sure to be more reasonable.
There's another potential issue weighing on acquisitions.
Some of the independent films were made under provisional agreements the Screen Actors Guild struck with the independent filmmakers. The studios, who own the specialty divisions that might buy these independent films, haven't struck a deal with SAG yet and certainly don't want to be pressured into any kind of deal. There's some question whether a studio that buys a movie made under a provisional agreement with SAG would be forced to adopt an interim agreement with the guild. It seems the studios would be able to avoid this issue, but it's yet another factor putting a potential cloud over the festival's market.
And Sundance is more than a festival-- it's a party fest and a destination for marketers to reach influential celebrities in swag gifting suites.
It seems in this environment it wouldn't look too good to throw the lavish parties seen in recent years, it'll be interesting to see how much the festivities are toned down. More on the corporate presence at Sundance later in the festival.
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