Indie Box Office More Resilient in 2009 Than Even I Thought
Posted by Jim on Monday, January 25, 2010 in Author • Louise Levison - Independent Film Finance Consultant • Film Blogs • Film Revenue & ROI • (0) Comments • Permalink •
All those small indie films do make a difference! The final total is $3.6 billion for the indie share of the North American box office rather than the $3.5 billion I had estimated based on the totals for the ten highest grossing indie films that were available on Dec. 31. Defying the expectations of most analysts, the rest of the independent films helped to bring the final total to $3.588 billion.
We all know, however, that the domestic box office doesn’t tell the whole story. I had two phone calls this month asking for quotes. One person wanted to know how many 2009 independent films had made money, and the other wanted to know how many had lost money. Neither one liked my answer. “No one knows. Ask me again in 2011.” Despite how some people like to count, the box office is not a total measure of how a film performs, even for many studio films. To get to even a gross profit number, you have to add in domestic ancillary (television/cable― free and pay, digital, airplanes, etc.) and all known foreign revenues, as well as take out the costs (budget and prints and ads). However, we don’t know all those numbers yet for films released in 2009. It can take two to three years from the start of distribution to have a full picture.
For many indie films, home video, even with its current problems, is still the main source for ancillary revenue. Since digital is still a new market, we only know the Internet data in macro numbers, not what the results are for individual films. During Cannes 2008, John Sloss said that it would be five to ten years before the Internet would be a significant revenue source. I think that is still true.
As for foreign sales, be advised that many low-budget films and some specific genres make sizeable revenues in the domestic market with comparatively little overseas business. For example, films with a lot of talking, especially comedies, often aren’t picked up for foreign, because distributors say that overseas audiences prefer film that don’t require English. Many African-American and other ethnic-themed films show few foreign revenues, as do many inspirational films. Whether overseas audiences actually won’t like a particular film, or distributors make an assumption that they won’t like it and put little effort into distributing the film internationally, is hard to tell. I see many assumptions about distribution that go back at least 25 years. We are in the second decade of a new century. Perhaps it is time to revisit and research whether such “truths” are correct.
Louise Levison Independent film finance consultant (www.moviemoney.com) and author of “Filmmakers and Financing: Business Plans for Independents”, she also created the business plan for The Blair Witch Project. Louise Levison is the author of Filmmakers & Financing: Business Plans for Independents and publisher/editor of The Film Entrepreneur: A Newsletter for the IndependentFilmmaker and Investors. Her clients have raised money for low-budget films such as The Blair Witch Project, the most profitable independent film in history, and for companies raising as much as $300 million. Levison is President of Business Strategies, a consulting firm that specializes in creating business plans for films and film companies, as well as consulting on other aspects of the independent film business.
