Indies see hopeful signs in VOD debuts

The future of specialty film could be now playing in your local multiplex — and your living room.

On May 15, IFC’s French import “Summer Hours” debuted simultaneously in theaters and on VOD.

Magnolia’s “The Girlfriend Experience,” directed by Steven Soderbergh, was available a full month on VOD before it hit theaters.

The two films have done well enough in both realms to provide ammunition for distribs who argue that simultaneous bigscreen-VOD releases are becoming an important piece of the indie distribution puzzle.

The Olivier Assayas-directed “Summer Hours” pulled in $554,165 at 37 theaters in three weeks while “The Girlfriend Experience,” marking porn star Sasha Grey’s mainstream debut, grossed $359,021 from 39 theaters in its first two weeks — decent numbers for niche titles.

In addition, both films have seen a healthy number of purchases. And neither distribution method seems to be cannibalizing the other.

Pessimists see trouble ahead with collapsing traditional distribution windows in this way. Optimists note that while the films and their grosses are relatively modest, the implications are huge for specialty films and indies — and even small-scale studio offerings fighting to hold onto screens in an increasingly competitive market.

“The guy in Lincoln, Nebraska who reads about a movie in the New York Times is now getting immediate access to it,” says Magnolia president Eamonn Bowles. “He doesn’t have to wait for a theatrical release or remember months later what the title was so he can get the DVD at the videostore. So your geographic footprint is much wider.”

Auds outside of the handful of cities that play foreign films are particularly benefiting from VOD premieres. And with auds increasingly reluctant to pay $10 and up per ticket for specialty films, the VOD fees of $4-$10 per household are starting to look pretty attractive to viewers.

IFC, the biggest buyer at this year’s Cannes film fest, and Magnolia, the frontrunners of releasing pics on VOD, think there’s plenty of potential in the delivery method, saying pics will soon be making two and three times their theatrical takings via VOD.

“We feel very strongly about the model,” IFC topper Jonathan Sehring says. “VOD users are kind of early adopters — a relatively small group but very influential in terms of creating word of mouth. We don’t see it as hurting the theatrical revenues.”

IFC and Magnolia each have seen enough success in VOD that others, such as John Sloss’ Cinetic, are expected to launch similar services while simultaneously pursuing computer downloads.

More than 50 million cable and satellite TV subscribers have access to VOD, a potentially huge audience for first-run films.

Bowles and Sehring are convinced the theatrical artpic biz remains viable despite the seeming head-to-head competition with VOD. Both IFC and Magnolia have access to booking their releases into theaters owned by their parent companies — IFC, as part of Rainbow Media’s Cablevision, is a sister company to the Clearview chain, while Magnolia is part of the HDNet empire, which includes the Landmark theaters.

But filmmakers and exhibitors aren’t feeling quite as sunny. Filmmakers complain that their cut of VOD revenues is even smaller than from the admittedly foundering specialty theatrical biz. Exhibitors, meanwhile, still suspect VOD premieres will cut into theatrical revenues. Many want to maintain the current window of four months between theatrical release and the home launch.

John Fithian, CEO of the National Assn. of Theater Owners, has been dismissive of simultaneous VOD rollouts, asserting that the number of films released simultaneously to the home is not going to grow much at all and that the new format hasn’t worked.

For Magnolia’s Bowles, however, the only drawback in concurrent VOD and theatrical releases is that once a distrib commits to a VOD premiere, the opportunity to go for a wide theatrical release is curtailed.

“But these aren’t movies that are going to have a run of 1,500 prints anyhow,” he says.

IFC is now releasing two titles a month on VOD. About two dozen pics have preemed on VOD to date, dating back to IFC’s release of 2006 Palme d’Or winner “The Wind That Shakes the Barley.”

“Four Months, Three Weeks, Two Days,” “Che,” “A Christmas Tale” and “Gomorrah” all have turned in decent VOD runs.

Magnolia saw VOD success in 2008 with Irish horror pic “Shrooms,” heist caper “Flawless” and James Gray’s Joachim Phoenix starrer “Two Lovers,” which grossed $3 million at the box office and at least that much on VOD, according to Bowles. IFC picked up six titles in Cannes this year, most notably Lars Von Trier’s “Antichrist,” which will probably go out in the fourth quarter. “It was probably the most talked-about film at Cannes,” Sehring says. “We think it’s very high on want-to-see lists.”

Most of IFC’s titles will use the date-and-date theatrical/VOD release model.Magnolia also has started selling its VOD slateon the Xbox vidgame platform. Both Xbox and Sony’s PlayStation are moving heavily into film downloading, as the game consoles enable viewers to watch pics directly on their TVs instead of on computer screens.

The model can work not just for foreign films with niche audiences, but also for U.S. indies. Upcoming Magnolia titles feature names like Bobcat Goldthwait directing Robin Williams in “World’s Greatest Dad,” Lauren Graham and Jeff Daniels in “The Answer Man” and Jennifer Lynch’s serial-killer thriller “Surveillance.”

Pat Saperstein contributed to this report.

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