News from the MediaXchange Village

An integral aspect of the access that MediaXchange aims to provide is a look into the industry as it happens. To stay current, you must keep informed. Look to this space for constantly updated discussion topics from the recent international trades, as well as updates from fellow members of our MediaXchange community.

Film Financing in America in 2010
David Patton, MediaXchange

At the recent Produced By Conference 2010, critically-lauded filmmaker Lee Daniels (Precious) was quoted in blog article ‘More Money Same Problems’ as saying : “Hollywood perpetuates fear. Well, [expletive] the fear. You want to know the secret to making movies? Here it is: just figure it out. But you must be fearless.”

For the producer or filmmaker looking to fund their next project, those are words to live by. Many producers are finding themselves being in the position of having to “figure it out” right now.

It seems that securing distribution and talent are still key to getting the financing. The real trick is lining up those elements without having the financing already in place. Although there are less movies currently being distributed, it puts more pressure on each of those films to perform. This makes for a more difficult market for the independent producer.

As discussed in a recent Variety article, many say budget is still a key factor in producing a profitable film. Hal Sadoff, ICM head of international and independent film, says that the 15-18 million range is best. Anything much higher than that could be considered too risky.

Independent financing is even trickling down to the television level, where the TNT show ‘Leverage’ is being financed independently by Winchester Capital Management, according to this Variety article, 'Leverage' lands independent financing: De Fanti, Sagansky to fund TNT drama's third season. Although television has shifted its finance models considerably in the last few years—primarily through international co-financing models—it is rare to see a season be entirely funded independently.

When developing your financial strategy, it’s important to speak with the experts in your field to recognize financing trends. The Film Financing Exchange offers veteran and new producers alike an opportunity to discuss financing with the pros in an intimate, personal setting. Spots are limited so sign up today!

Hitting a Moving Target: U.S. Agents and Managers
David Patton, MediaXchange

If you’re looking to launch a project in the US or internationally, it is important to have an understanding of the US agent and manager. Although agents are found worldwide, the role of the US agent is quite unique. The following discusses some recent examples of deals, mergers, and how all of this could apply to your next project…

Chances are that your Hollywood agent won’t be able to procure you a studio picture deal with a payday of $20 million against 20% of first-dollar gross, as William Morris Endeavor recently did for Sacha Baron Cohen, according to Nikki Finke and Deadline.com. However, the right Hollywood agent or manager can greatly increase the chances of getting your next project moving.

After the 2009 merger of the William Morris Agency and Endeavor, there has been a lot of movement within the Hollywood agent community. Creative Artists Agency (CAA), International Creative Management (ICM) and United Talent Agency (UTA) have all reaped the benefits of merger, picking up clients and agents that were dropped along the way.

But it may be the studios that have benefited most from the WME dustup. They leveraged the dissonance within the Hollywood ten-percenteries to “trim talent deals and thus cut costs,” according to a recent piece by Peter Bart at Variety. With many clients temporarily finding themselves unrepresented, and many agents no longer at an agency, studios took advantage. Within the last year, the big deals simply weren’t being made. Combined with the economic recession hitting all American industries, big time dealmaking in Hollywood slowed to a trickle.

That is why the Sacha Baron Cohen/Paramount Pictures mega-deal was front page news when it was announced recently. This deal may be a signal that studios are willing to go back to pre-recession prices for talent and development. According to a source at the agency gossip website Deadline.com, "This actually shows where the bar is for A-talent to get something done. That it used to be, if an A-talent was interested in a project, that would get the movie going. Now, you have to have the combination of an A-level star and a great idea that is completely developed."

And what are some takeaway lessons from all this commotion?

Since market is changing it’s important to have the right agent. It sounds obvious, but it’s true. The right agent should understand your project and have an idea who might be interested. It’s about connecting the right buyer with your project, and no one should know better than your agent.

Your agent or manager may get you in the room, but the sale of a project ultimately falls to you. Even with Sacha Baron Cohen’s incredible box office track record, he had to make the rounds, give a great pitch, and ultimately sell his idea. Baron Cohen and his co-writing producers hit “6 studios in 2 days pitching for an hour each…They all kind of came up with the pitch together. And one of the reasons this was so special is that the whole storyline was fleshed out, including all the main comedy scenes, by Sacha during the pitch," according to Nikki Finke’s Deadline.com. No amount of agenting can create a bidding war if the content and delivery isn’t there.

Studios are gaining leverage. Let’s say you have a great project and your agent has worked out a deal, odds are that this deal won’t be as large as in past years.

And who knows? Maybe your next project will get that $20 million deal after all…

The Agents and Managers Exchange offers creatives and executives alike an opportunity discuss representation with the Hollywood pros in an intimate, personal setting. Bring your projects, bring your questions, and give yourself the opportunity to meet with Hollywood agents. Spots are limited so sign up today!

New Trends in Home Video Distribution
David Patton, MediaXchange

The home video landscape is changing and “streaming” seems to be the word on everyone’s lips.

Hollywood studios and cable providers have teamed up to roll out their new $30 million advertising campaign, “The Video Store Just Moved In.” Due to the continued declining sales of the DVD format, studios are realizing that streaming video onto consumers’ recently purchased HD televisions is a more cost efficient, and profitable, alternative. Video On Demand, or VOD, allows consumers to rent films and watch them on their television, usually for a premium rental price.

Netflix has also found great success in its streaming of films directly to the consumer via its Netflix Instant service. For the cost of basic Netflix membership, subscribers can instantly stream thousands of films and television shows directly onto their computer or Netflix-enabled device. With the recent announcement that Netflix Instant streaming is now available on the Nintendo Wii, Netflix has cornered the home video game console market. Xbox 360, Playstation 3 and now Nintendo Wii all are capable of streaming Netflix’s vast catalogue of content.

While consumers receive the immediate benefits from this glut of streaming availability, one company is feeling the pinch: Blockbuster Video. Once the king of home video distribution and rental, this brick-and-mortar-based mega-chain recently announced that it may have to file Chapter 11 bankruptcy. With the advent of YouTube.com and Hulu.com, consumers’ video-watching habits are changing. Now, even a quick trip to the video store can seem laborious as opposed to simply clicking on a movie from your computer or television screen.

And if all this streaming video isn’t fast enough for you, how about getting those new home video releases a month earlier? In March, with the opening of Disney’s ‘Alice in Wonderland,’ the release window for home video may be changing permanently. In a controversial decision, Disney announced that it would release the film onto home video an entire month earlier. What has been traditionally a four month gap between theatrical release and home video release, Disney has now reduced to three. While many theatrical exhibitors scoffed at this shortened release window, the film ‘Alice in Wonderland’ has remained at the top of the weekend box office for four weeks straight. Consumers seem to be not concerned that the film will be available for rental and presumably digital download within only three months time, but not everyone agrees with Disney’s decision. And only time will tell if Disney’s home video strategy proves effective in the long-term.

With its ever growing roster of new media clients, MediaXchange is always “in the know” with the latest tech trends. How will changes in digital distribution and online streaming affect your business? MediaXchange navigates this new frontier with a custom-made, client based approach. We are your Global Positioning System.