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MOSCOW — Indie distribution in Russia faces a tight squeeze in the next couple of years as key markets in television and home entertainment retract in the face of the global financial crisis and challenges from increased local movie output.

With Hollywood still dominant at the Russian box office, international indie product is facing increasing competition from local Russian films — which accounts for up to 30% of the exhibition market.

It is also challenged by a growing trend toward Hollywood-studio backing for local-language films in a market that continues to demonstrate an appetite for homegrown stories.

Monumental Pictures — a collaboration between Sony and longtime local industry vets Paul Heth and Michael Schlicht — will see its sequel to 2008 Russian comedy spoof “The Very Best Film” (which grossed more than $27 million), hit screens in January.

Disney is making a Russian children’s fairy tale with Oscar-winning director Nikita Mikhalkov’s Three-T Studio.

And even Central Partnership — long the flag bearer of indie distribution and production in Russia — recently announced a strategic alliance with Paramount. It will make Central Partnership, which is Russia’s fifth-place theatrical distrib with a 7.3% market share, the exclusive distributor of Paramount product in Russia and opens the way to co-productions between the two companies.

Central Partnership will continue to buy the sort of strong international indie product it favors, such as fall release “St. Trinian’s.” But Armen Dishdishian, CP’s exec VP of international, warns that sales companies must be more flexible with their pricing.

“Prices have been rising sharply over the past five years due to cutthroat competition between distributors of indie product in Russia, but the global crash means that has come to an end,” says Dishdishian, whose company is behind Russian Oscar submission “Mermaid.” “TV and DVD sales are key to meeting minimum guarantees, and with so much Russian product out there those markets are cutting back. Prices have to come down.”

Dishdishian’s approach at this month’s American Film Market could likely be reflected by other Russian indie buyers: If the price isn’t right, they’ll walk.

Plans by some large Russian media corporations to find extra revenue from Internet and VOD sources have been put on hold, further weakening appetite.

2008 B.O.

$654 million (to Oct. 5)

Top title

“Irony of Fate — The Sequel” ($50 million)

Recent pickups

“Class” (Kino Bez Granits)

“Paris” (CP Classic)

“Saw 5” (Cascade)

“St. Trinian’s” (Central Partnership)

“Tekhnologiya” (Nashe Kino)