Russia’s fim biz booming

Is it too much too fast?

Just a few days after the Dec. 2 landslide victory for Vladimir Putin and his United Russia party, another campaign hit the nation.

The country’s snow-covered landscape was blanketed with ads for the Dec. 21 bow of “Irony of Fate: Continuation,” the bigscreen sequel to a 1975 comedy of errors that is watched on TV every holiday by various generations of Russians who by now can recite entire passages from the film.

The country has changed enormously since the original “Irony” was released. In those days, moviegoing entailed hard seats, vast, gloomy, unheated auditoriums, bad sound, dreadful scratchy prints — and no popcorn, let alone soda.

But “Continuation” will launch on 1,000 screens, many of those in modern multiplexes that have sprung up in the last decade.

The changes that have occurred between the original film and its sequel point up the transforming economy and the rapidly booming film biz.

Another symbol of the changing times: Putin’s anointing of Dmitry Medvedev as his favored successor (which means he is likely to be the next president).

Medvedev, 42, has said his favorite bands are Brit metal groups Black Sabbath and Deep Purple. He is a fan of democracy and has said that Russian schools should teach “Olbanian” — slang for fluency in the Internet.

Many Westerners’ envision Russia as a country filled with sad-faced folks dressed in dreary rags, lining up under cloudy skies to buy borscht and vodka, all being terrorized by the Russian mafia while “enemies of the state” or renegade artists are sent to Siberia or a gulag.

These are fascinating notions, but no longer true.

There is a new middle class of upwardly mobile professionals with so much disposable income they’re willing to pay $50 a ticket to watch films in VIP Salons, where filmgoing is a status symbol and they don’t have to endure the hoi polloi.

Most moviegoers, aged 14-25, pay far less. This is a generation that grew up without knowing the Soviet Union or the chaos of the Yeltsin years. They go to the 1,800 and 2,000 modern screens, many of them in shopping mall multiplexes strung across Russia. Or they go to play videogames on the Internet in dens packed with other slouching figures of kids engaged in their own virtual worlds. Black-coated, body-pierced Goths mingle with skateboard slackers (or, in winter, snowboard slackers), each isolated in their own microcosm.

And, while contract killings still make headlines, the ubiquitous mafia activity of the 1990s is less evident in the lives of ordinary people.

The growth of Russia’s oil and gas industry, rising incomes, the expansion of the middle class and political stability under Putin (despite criticisms some Westerners level at him) have all changed the country drastically.

And one of the key beneficiaries: a sustained and bullish entertainment business.

With 141 million people and showbiz enthusiasm, many Westerners have labeled Russia as one of the great growth areas in the coming years, like India and China.

The country boasts 65 million admissions a year, meaning in a relatively short time, it has become the world’s 10th biggest film market and sixth in Europe. Box office this year is on target to top $560 million and is forecast to stabilize at around $900 million annually within a couple of years, according to Alexander Semenov, publisher of the authoritative industry publication Russian Film Business Today.

The showbiz boom is being fueled by a flood of new money coming into the marketplace. The growth has been so great that there now are fears of a production glut and the inevitable shakeout that comes with it. Already, distributors are jockeying for prime release dates, and there’s an inkling that only the best-financed Russian films and American blockbusters will benefit.

Like their counterparts in Western countries, serious filmmakers worry about audiences’ taste for CGI fare. And the costs for distribution, publicity and advertising have quadrupled in the past two years, while production costs have tripled, entrepreneur Paul Heth told a Moscow roundtable on the film industry last month.

“Too many Russian films go out with no clear release strategy, effectively cannibalizing each other. Production prices in Moscow and St. Petersburg are now at Western European levels.”

Heth and his partner, fellow American Ray Markovic, opened the first post-Soviet modern cinema: The single-screen Kodak Kino Mir, which bowed in downtown Moscow in 1996, following a $2 million refurbishment.

The changes in cinemas reflect the changing economy. Salaries for college graduates with two or three years of experience in fields such as law, media or advertising are running $2,000-$3,000 or more a month, at least double the highest wages a skilled blue-collar worker may expect, and disposable income is high.

For those brought up under Communism, when everything was dull monochrome, escaping the crowd and creating personal space is not a question of money, but of pride.

“For a good night out with comfort and some exclusivity, you can pay $50 a ticket for seats in VIP screening halls where you’ll share the movie with a more intelligent audience — one that doesn’t talk through the movie on mobile phones,” remarks Armen Dishdishian, president of Central Partnership Sales House, the sales wing of Moscow-based independent production and distribution shingle Central Partnership.

Conspicuous consumption is still in fashion here.

Top Hollywood films, like “Pirates of the Caribbean: At World’s End,” which this year grossed roughly $31 million in Russia and former Soviet states, are popular. But Russian-made movies command 30%-35% of total box office, and with oil money all but gushing in Moscow’s gutters, Russian producers are churning out films in bulk: some 100 or more this year alone.

“There’s a danger that the domestic production market is overheating,” Dishdishian says.

Dishdishian points to the discrepancy between Russian cinemagoing demographics and those in other parts of Europe: Barely any Russians over the age of 35 go to the movies, with 90% of audiences aged 15 to 25. In France, by contrast, people over 35 make up 43% of the audience, which has a significant effect on the sort of films that get made — and achieve success.

In Russia, that means youth is served.

“As a company, Central Partnership aspires to produce a diversified slate of films, but the current state of the market forces us to make commercial decisions,” he says, explaining why next year’s slate contains films such as teen comedy sequel “Ne Kto Ne Znaet Pro Seks 2” (Nobody Knows Anything About Sex 2) alongside more serious movies such as costume drama “Taras Bulba.”

The rush of new, inexperienced producers — many of whom have grossly exaggerated expectations, such as achieving 20% of return from DVDs (in a mature market like France the official figures show DVD and video overall account for just 2.2% of revenues) — are “breaking basic industry rules,” he says.

“There is going to be a shaking-out in 2008, and only strong Hollywood movies and good Russian films — ones that use technology well or have some other novelty factor, 3-D or digital — are going to fare well,” Dishdishian predicts.

Rodnyansky at CTC agrees Russian-made films are due for a rethink; In 2008, Hollywood producers are likely to have the best opportunity for clawing back some of the Russian box office they lost to local fare in recent years, he says.

And, despite Westerners’ concept of state-controlled cinema, film directors say the silver screen isn’t prone to censorship (although Putin has crushed freedom of expression and driven all independent television off Russia’s smallscreen).

When Alexei Balabanov’s shocking “Cargo 200” premiered at the Russian national film festival Kinotavr last June, producer Sergei Selyanov boasted that he would gladly arrange a screening for Putin. The film, set in the mid 1980s, depicts murder, rape, decomposing corpses, torture and filth.

Positioning of films in Russia is becoming more important, w
ith keener attention to release dates mirroring the Western film biz.”Irony of Fate: Continuation” is bowing 10 days before the date that most assumed it would premiere — so the new film has a virtually clear box office run. Although Rodnyansky’s coming of age costume drama “1814” opens Dec. 27 on 300-plus copies, the comedy “The Very Best Movie” was bumped back to late January to make room for the true juggernaut.

“Very Best Movie” and “Continuation” are both releases from First Channel, the country’s top TV broadcaster, which has produced a string of massive domestic movie hits.

Observers believe “Irony’s” producers are gunning for $50 million at the domestic box office in addition to any international sales such a culturally specific film may have.

Last year, “Day Watch” opened on the stroke of midnight Dec. 31, traditionally a family day when cinema attendance is minuscule. The pic went stellar immediately.

“Continuation” stars the original film’s three key performers: Polish actress Barbara Brylska and Russians Andrei Myagkov and Yuri Yakovlev. But this time around, they play the parents of another love triangle, in which today’s top Russian stars Konstantin Khabensky and Sergei Bezrukhov compete for the love of Elizaveta Boyarskaya.

“They taken on a huge challenge — there is a whole national mythology around the old film — but having singlehandedly created the phenomenon of the Hollywood-style homegrown Russian blockbuster, they certainly have the experience. We shall be following closely how their campaign unfolds and how the film does,” says Alexander Rodnyansky, head of entertainment network CTC, Russia’s fourth biggest channel, as well as a film producer and co-owner of film fest Kinotavr.

The producers are hoping to win over a whole new generation of moviegoers. It’s a big risk: Eldar Ryazanov’s 1975 original became an instant classic by poking gentle, yet accurate fun at the uniformity of Soviet life.

Loved by Russians with same kind of intensity Americans reserve for Frank Capra’s “It’s A Wonderful Life,” the grainy, bleached colors of the original play on television channels across the nation every New Year’s Eve, as families gather for a holiday that long ago replaced Christmas as the key winter festival here.

By daring to make this sequel, producers Konstantin Ernst and Anatoly Maksimov with director Timur Bekmambetov — the team that broke all Russian records with homegrown fantasy epics “Night Watch” ($16 million domestic box office in 2004) and “Day Watch” ($36 million domestic this year) — have taken on the holy cow of Russian cinematic culture.

Anatoly Maksimov, one of the producers of “Irony” and a co-writer of its script, admitted that they were “a little nervous.”

“Everyone has their own dreams on what happened to the young couple in the original film,” he says. “This is our gift for the New Year, the only celebration in Russia that unites the whole country, bringing together old heroes of socialist labor and young acid punks around the same table, even if only a short while.

“This is not challenging a sacred cow; the film is the child of the holy cow.”

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