Buyers and sellers at the American Film Market in Santa Monica were clearly relieved to be busier over the weekend than they were at the beginning of the weeklong event.
But one message received from the mart is that the number of movies being produced is set for a tumble over the next year.
AFM’s opening day was clearly slower than that of previous markets. The corridors of the Loews hotel were occupied but not heaving, and restaurants in the Shutters hotel were taking diners without reservations.
By the weekend the decibel level and some folks’ spirits were rising. Deals have been done, and prices for most territory rights appear to be holding at recently adjusted levels.
“People are extremely concerned about their own economic situation and are extremely targeted. They come here knowing exactly which five or six pics they are interested in, and largely they have stepped up to the mark (in terms of prices),” said Lisa Wilson, prexy of international at Graham King’s GK Films.
Nu Image chairman Avi Lerner is like most independents in that he’s never going to be completely happy with the state of the market. Lerner is capable of saying, “This is the biggest ever AFM for us” and almost in the same breath saying, “The market is slow” — and that from a man selling out on the hottest title in the market, the Sylvester Stallone-helmed $60 million mercenaries actioner “The Expendables,” headlining Stallone, Jason Statham and Jet Li.
But Lerner’s four-point analysis of why the current pain is deadly serious is shared by many bizzers. “First, there are too many pictures and not enough demand. Second, there’s no money. The banks are not there for the distributors, and that’s never happened before. Third, and it is a problem that isn’t getting any better, is piracy,” he said.
His fourth point presages lower business at future markets. “People don’t just buy a ticket to any movie any more; they choose what movie they go to. That is why the (Hollywood) studios are cutting the number of films they make and are making them bigger. In 2009 we will make less films and at lower prices.”
GK’s Wilson also points to an oversupply that the global financial crisis is on the way to correcting. “The market was flooded with pictures made with private equity money. We believe that there will always be room for pictures at the top of the range. However, there is only a handful of distributors in each territory buying this scale of picture,” she said.
If the ticket-buying public is becoming more selective, so too are the distributors.
“The market is slow; there are fewer exciting projects,” said Marcin Piasecki, artistic director at distributor Kino Swiat, which controls more than 10% of the Polish market. “For the first time in a long time, we don’t have to take whole packages in order to buy the titles we want. It is a buyers’ market, especially in East Europe. Russia has been badly hit by the economic crisis and is no longer driving up the price of rights in the rest of the region.”
German sales agent Ida Martins is typical of those happy that the AFM has overcome its slow start. “On day one there wasn’t even a queue for lunch. Now I’m feeling more optimistic. I arrived here from a slow Mipcom and did not expect much,” she said. “What we’ve found is that there are buyers making offers, and in one case we even had a fight over rights in Australia,” Martins added.
“There’s been activity in Asia and the smaller territories at price levels within our expectations. We can now be confident of closing deals in Europe later,” said Ricky Tse, head of sales at Media Asia, Hong Kong’s largest production and sales outfit. “It is perfectly clear that to do business now you have to have titles that stand out. We are happy to have two films by Johnny To, who is a hot potato with distributors these days.”