It's pretty simple. When people make money doing something, more money enters that system. And it is pretty simple in the reverse: when some people make a bucketload and those that invested in it make virtually nothing, less money flows into the system.
If distributors don't pay creators their fair share of the profits, their won't be movies made. Or maybe the investors will get wise and stop selling the distributors the film. After all we are at a time that you can really do it yourself (by doing it with others). And to be clear, "fair share" doesn't mean paying them what contract swindles them out of -- it means paying them an ethical cut. And that sure in hell ain't 12.8% of the profits -- which is what happened on one of the most successful indie films of recent times.
If there is one simple goal for the new year, every filmmaker should make sure their investors get paid what they deserve. It is for all of our benefit. If there is more money available for indie film investment, more movies will get made and hopefully they will be more diverse and ambitious.
It makes me furious when I hear of a film that generated tons of cash and very little flows back to those that support the work. It makes everyone feel that the system is corrupt. It makes investors think that they can't win.
Film distributors are supporters of our cultural institutions -- especially the specialized ones. Wouldn't you be embarrassed if you released a film on DVD and it generated $139 Million Freaking Dollars and you only shared 12.88% of that tremendous wealth with the people who created the movie? Wouldn't you expect that filmmakers would all be wearing t-shirts this year at Sundance that point out that 12.88% is not a fair profit share?
That is what happened with Napoleon Dynamite. Read the shocking story here.