Bizzers headed to Berlin will find it harder to get space at the Ritz-Carlton bar this year. New sales-financing companies spawned in the wake of independently backed blockbusters like “The Hunger Games” and the “Twilight” franchise will be on the make at the European Film Market for the next “Best Exotic Marigold Hotel” or “The Impossible” — pics in the suddenly hot adult drama category — even as the ever-more-rapid decline of DVD threatens to put a damper on lower-budget projects that don’t have the whiff of theatrical play.
It’s a scene that inspires optimism in some key players, trepidation in others.
FilmNation topper Glen Basner’s coming to the Berlinale in a bullish mood.
“I love coming to Berlin,” he says. “It’s a late-breaking market with a lot of projects, but when you get there, people are prepared to make buying decisions. So we believe that you have to bring top-tier projects to every market.”
In Basner’s case, that would be Marc Lawrence’s untitled romantic comedy starring Hugh Grant and Marisa Tomei. Castle Rock Entertainment’s Martin Shafer and Liz Glotzer are producing. Lawrence will direct from his own script, with shooting to start in April in New York.
“It’s a studio-level romantic comedy, which is something that doesn’t get onto the international market often.” Basner notes.
A year ago, FilmNation handled international sales on Steven Soderbergh’s “Side Effects,” which is having its international premiere at Berlin this year, along with Anton Corbijn’s “Most Wanted Man” and “All Is Lost.”
The sector’s still feeling its way in the wake of the worldwide success of Lionsgate, a year removed from buying Summit.
Since last year’s Berlin, “The Hunger Games” and the final “Twilight” film have grossed $1.5 billion worldwide, underlining the viability of independently financed films and triggering a burst of new sales-financing companies that are joining an already growing sector.
One of the newest players to hit Berlin is Exchange Peaks Film Capital, after two-year-old sales banner the Exchange partnered with Grand Peaks Entertainment to launch a full-service specialty film fund with plans to finance and produce four to six movies annually.
Exchange Peaks will be run by Exchange prexy Laura Ivey, reporting to CEO Brian O’Shea. Grand Peaks, a large Denver-based property owner and developer, was introduced to the Exchange by Nat McCormick, its VP of worldwide distribution.
First project to benefit from the fund is the Exchange’s marriage drama “The Last 5 Years,” directed by Richard LaGravenese, with Anna Kendrick starring. “Years” was introduced to buyers at AFM in November.
Patrick Wachsberger, who built Summit into a sales giant, says he plans to use Berlin for taking marketing meetings on potential franchise “Divergent,” with shooting set to start in Chicago in April. But he’s pleased about the level of activity at Sundance.
“Sundance made me feel like the energy and the money are back,” he notes.
Additionally, the commercial and critical success of adult-skewing dramas — “The Best Exotic Marigold Hotel,” “Argo,” “Lincoln,” “Silver Linings Playbook,” “The Impossible,” “Zero Dark Theory” — is serving as a tonic to the indie marketplace. Panorama Media, launched less than a year ago as a production-financing-sales entity with backing from Megan Ellison’s Annapurna Pictures, made a big splash at Cannes by selling out most international territories on “Zero Dark Thirty”; the banner also saw solid sales on “Castle Wolfenstein.”
“I could not be more excited about adult dramas,” says Panorama topper Marc Butan. “Five years ago, that area was dead, and now it’s what’s really working.”
All that success, however, is resulting in bifurcated expectations, Butan notes, particularly amid the ongoing decline of the DVD market, and with VOD not yet developed enough to replace that revenue stream.
“You can sell, but now it’s either going be perceived as either an A-list title or a D-list title,” Butan says. “The old direct-to-video doesn’t really exist any more, and the ancillary values of a film are really created only by theatrical. In other words, audiences want the real thing.”
Exclusive Media distribution president Alex Walton notes that distribs are ready and willing to buy, particularly adult dramas, with a need to fill slates for mid- to late-2014.
“Everyone wants an original concept in a known genre that gives distributors something they know how to work with,” Walton adds. “Smart, sophisticated movies like ‘Lincoln’ and ‘Argo’ used to do $50 million or $60 million, so it’s amazing to see them doing above $100 million. Buyers have to be a little frustrated, because everyone’s looking for (the same type of) commercially driven films.”
With Hollywood studios perceived to be continuing to pull back on films budgeted at less than $70 million or so, the bigger indies have been trying to assemble high-profile projects to fill the gap — a task that’s not as easy as it seems. David Garrett of Mister Smith Entertainment, a joint venture with Germany’s Constantin, sold out most markets at AFM for “Imagine,” starring Al Pacino, Jeremy Renner and Julianne Moore.
“Everyone’s scrambling to get projects for AFM,” Garrett notes. “Then there’s Thanksgiving, winding down for Christmas, then Sundance. There’s little real working time for people to focus on putting together more projects. Berlin is never going to be the one where you get most projects happening.”
Garrett believes it’s a tricky time for the international market.
“It’s a cliche to say, ‘It’s not getting easier,’ but I think it’s not getting easier,” he says. “Most television stations are still finding their advertising revenues are depleted. Without ancillary markets supporting minimum guarantees in the way they used to, everybody’s much more risk-averse, more cautious.”
Ironically, he adds, there’s funding available to produce movies, but not to finance distribution. That means films have to made for less money, despite the fact that P&A costs are still rising, and ancillary revenues are declining. “The pot is smaller,” Garrett says.
Berlin is traditionally a market for arthouse, serious dramas and social fare aimed at European distributors. True, there is a steadily gathering shift among prominent European companies toward producing upscale mainstream or at least crossover fare in English. But the larger question is how much of that, and how much product from the growing welter of U.S. sales companies, new and established, might find its way onto the market at Berlin.
Last year, the Berlinale saw an eve-of-fest tsunami of big English-language product. This time around, in France, home to many of Europe’s biggest players, many say they are reserving their top fare for Cannes.
Constantin’s Martin Moszkowicz believes last year’s markets were so strong that buyers may be taking a bit of a breather.
“The market is cyclical,” he says. “Last year, Berlin, Cannes, all the markets were busy. So people are exhausted.”
Moszkowicz notes that the indie sector has not seen major success beyond the Lionsgate titles and French hit “The Intouchables.”
“If there are many independent movies that are making money, then there’s money in the system, and people can buy, but the big second half movies were nearly all studio product,” he adds.
Focus Features Intl. topper Alison Thompson agrees that Berlin is a down-to-the-wire affair as producers and sellers scramble in the wake of Sundance to pull projects together.
“We have not been inundated with scripts, but Berlin is very useful to us,” Thompson says. “We’re screening ‘Promised Land’ in competition. We spend time talking to our distributors a little bit about what we will be selling in Cannes.”
Lisa Wilson, topper at year-old sales-financing banner the Solution, is coming to Berlin with the Joel Edgerton-penned “Felony,” romantic comedy “Two Night Stand” and a new promo on “Grand Piano.” She admits that the market is sending out mixed signals, with distributors having received 10 to 15 scripts as of last week.
“Presales are harder than ever to do because of Blockbuster and HMV closing in the U.K., which created a sense of panic,” she says. Still, Wilson will come armed with “Felony,” from the same producers as “The Sapphires” and a cast that includes Edgerton, Tom Wilkinson and Jai Courtney; and “Grand Piano,” a Hitchcock-type thriller. That pic is shot in Spain, which should help in landing a TV deal.
Pierre-Ange Le Pogam of Stone Angels, meanwhile, says he was impressed by the strong level of sales at Sundance.
“In U.S. distribution, there are a lot of good companies who have always been there, and new companies who look to be buying pretty aggressively,” he says. Le Pogam has Nicole Kidman’s “Grace of Monaco” in post.
Additionally, VOD is starting to show promise outside the U.S. Andy Mayson at the U.K.’s Altitude Film Entertainment, says that while VOD is at different stages in different territories and hasn’t offset the decline in DVD, it will eventually.
Said Ben Said, at Paris-based SBS Prods., producer of Roman Polanski’s “Carnage” and Brian de Palma’s “Passion,” has a grander and pithier view of the Berlinale. “Berlin remains one of the three great markets of the year,” he says simply.