Was it good news for film lovers everywhere that Cinedigm, a company that provides smaller theaters with digital projection, said it helped arrange funding to save 3,000 screens from extinction when studios phase out film prints of movies?
Early this month I wrote about how Independent Exhibition & Distribution In The US Is Seriously Threatened by the conversion to digital. If only it was simple as putting in the digital projectors and servers. Don't get me wrong, that's a great leap forward... in some ways.
Virtual Print Fees (VPFs) may provide a way for exhibitors to afford the equipment to go digital, but they indirectly, but severely, limit the type of films that can play theatrically. The answer to a Grand Abundance of movies is not to limit accessibility but to curate audiences as well as films. We have to give communities what they are hungry for… but between exhibiton splits & VPFs only films that can afford to buy (not build) audiences can truly be distributed.
The math is simple. Let's say exhibitors take at a 60/40 split at the box office. A small film might hope to do $2500/week. That means that the distributor is left with $1000. The VPF is generally $800 I believe. That means if they are 10% off that projection, they loss money playing that theater. And from the filmmaker perspective, when the the distributor is taking a 30% fee on rentals, you are in in the hole no matter what. And that doesn't take in the fact that costs, plus mark up and interest are in front of the line.
Say good-bye to small movies playing theatrically. Unless something else is done
It's so ironic that the promise of digital delivery was a more diverse menu for audiences, but it is proving to be anything but.
Another problem with the digital exhibition set-up was recently pointed out to me. Back in the days of film, when a movie was performing better than expected, all the exhibitor had to do was move the print to a bigger room. Ditto when it was bombing, the film went whoosh into a smaller room. DCP's give the studios more control over what room a film plays in in the multiplex than ever before. If they book BATTLESHIP into the big room and it dogs, guess what? No move over because the DCP's key code only works for that projector -- unless you get on the horn and track down the distributor and the flunkey on the phone gets the aproval of the uberlord to allow a move over. Too much friction prevents efficiencies of old from taking hold.