Anne Thompson on Hollywood

Somewhere over the rainbow is a place where indie filmmakers use the Internet to sell their movies all over the world. They don’t have to spend a fortune on prints and theatrical distribution; they sell their movies online directly to their target audience, and pocket a hefty cut of the revenues.

That magic moment may not be far off, says producer Linda Nelson, whose microbudget crime drama “Shifted” is available as a video download, a DVD or rental at www.Unbox.com.

While the pic’s sales to date are nowhere near that of a major studio release, Nelson is on a mission to get filmmakers away from established distribution — to remove what she sees as greedy intermediaries from the system. Nelson Madison Films has launched Indie Co-op, a subsidiary, to help filmmakers self-distribute their films on the Internet.

“This could break up the logjam and allow more content to flow out,” she says. “A lot is falling into place right now.”

Nelson co-wrote “Shifted,” a bare-bones thriller about a homeless man, with her business and life partner Michael Madison, who directed.

Filmed under a SAG indie contract with deferred actors’ salaries, “Shifted” cost about $100,000 to make. “It stinks,” admits Nelson. “(But) for what we had, it’s amazing.”

While the movie has tallied less than $1,000 in sales on Amazon Unbox, Nelson says she’s applying what she’s learned to help other indie filmmakers release their films without giving away the store to distributors.

Since arriving in Los Angeles in 1980, the former overseas investment banker and computer systems analyst has had an adversarial relationship with the movie business. She ran up against at least one shady business partner, and her ambitious plans to renovate eight movie palaces for large-screen formats ran afoul of both Imax and the ’90s exhibition bust. She and Madison gave up on large formats after they failed to close the DVD rights to their 2002 Iwerks concert doc, “INSYNC: Bigger Than Live,” which grossed $1.8 million in North America.

Unable to raise funding after two years for a slate of indie features, she and Madison finally “got brave,” she says. They picked themselves up and shot “Shifted,” a picture they couldself-finance and control.

The film’s producer and director of photography, Nelson bought a light Canon XL S1 camera and shot with Madison, who doubled as her director and leading man. They filmed inside a self-storage facility they were managing.

After many rejections from film festivals, “Shifted” was accepted by L.A.’s Dances With Films in July 2006, where it scored positive reviews from FilmThreat.com, SilverBulletComicbooks.com’s Don’t Call Me Fanboy blog and CBS Radio.

“We knew we didn’t have the quality to stand up to a theatrical release,” Nelson says. “But we got five offers from DVD distributors.” Nelson, however, was shocked by the deal terms, which were typical: No advance without a star or a decent budget. No piece of the backend. The distributor hangs on to its rights for seven to 10 years. And when they sell the DVD on the Internet via Amazon or Netflix, the distrib takes 25% of the gross and subtracts all expenses, including replicating and supplying DVDs and marketing. (Netflix won’t take any films without a distributor.)

Nelson was amazed, too, by the distributors’ lack of accountability. “They send quarterly reports by country,” she says, “But they don’t tell you how many units they sold. They don’t keep track by film. They don’t have systems or bookkeeping capabilities. There’s no such thing as making money. What you get upfront is what you are going to see.”

But this situation won’t last much longer, Nelson predicts. “Everything is changing,” she says. Any neophyte filmmaker faces a huge puzzle when it comes to selling theatrical, TV and video rights around the world. But it’s nothing the right software can’t solve.

Nelson found a do-it-yourself-DVD distribution company called CustomFlix, which was bought by Amazon in July 2005, and started supporting Amazon’s video download service in December 2006. “Shifted” was the first CustomFlix movie to be sold on Amazon Unbox.

Nelson sent CustomFlix her movie, uploaded her artwork, figured out how much she wanted to charge, and posted her trailer, pictures and posters. All she had to do was click a box, and “Shifted” was for sale on Amazon Unbox.

Unlike other DVD distribs, Amazon Unbox and CustomFlix offers a 50/50 deal: Half of the revenue goes to the filmmaker. Even if the money has yet to add up to $1,000, “I get a check every month,” says Nelson.

On the Amazon Unbox “Shifted” Web page, the film is available to rent for $2.99 for 30 days, for video download for $8.99, or for DVD sale for $14.95. The “studio” is listed as CustomFlix.

Another Nelson discovery is inDplay.com, a business-to-business application for buyers and sellers of film rights and a digital marketplace. “It’s fabulous software, a DRM management system that is usable by anyone,” Nelson says.

Via inDplay, filmmakers can create, edit and approve contract offers, and list their film libraries. Nelson hopes that inDplay will soon work with CustomFlix to stream movies for free for distributors, doing away with mailing clunky DVD screeners.

At long last, as Nelson chases her vision of a nimble do-it-yourself future for filmmakers, she seems to have found her niche.

To see Anne Thompson’s blog, go to www.ThompsonOnHollywood.com

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