Berlin: Market Reveals Select Sales But Tough Business

Deals, buyers reflect a more concentrated market

knight of cups

Berlin was no bust. But confirming expectations, trading underscored the challenges facing an international industry that is undergoing a profound seachange.

Several high-profile marquee draws, such as IM Global’s “Hacksaw Ridge,” FilmNation’s “Army of One” and Ray Croc bio “The Founder,” with Michael Keaton; Sierra Affinity’s “Gold,” starring Matthew McConaughey; Pathe’s “Florence Foster Jenkins”; Bankside’s Sapphic “Freeheld,” with Julianne Moore and Ellen Page, pushed out some weighty major territory sales. Other companies, such as Studiocanal, Bloom and Mister Smith Entertainment, still have to report business.

Beyond select U.S. deals, however, much of Berlin’s action looks set to focus on top fest hits or Cannes hopefuls.

“The big titles at Berlin will get sold. No question about it,” said Ivan Boeing at Imagem. But, he added, sales companies are reporting difficulties pre-selling the small stuff, the medium-range titles, or the not-yet-completely-packaged ones: “I think this is really something new.”

Constantin’s Martin Moszkowicz noted that there was more business than usual on festival titles, but “on American titles, it was a fairly big disaster, which also shows where the market is heading.”

He added: “Market shares for local movies are going to go up everywhere. The classic mid-sized U.S. movie, once the backbone of the independent business, is not really selling in wide numbers (in Europe).”

There were exceptions, of course. Daniel Hammond’s Broad Green Pictures, an highly active new U.S. distributor, picked up two Terrence Malick movies: Berlin Competition player “Knight of Cups,” above, and an untitled upcoming pic. Sony Pictures Classics secured North and Latin America on Olivier Hirschbiegel’s “13 Seconds.” Lionsgate bought “Freeheld.”

IM Global made a slew of sales on the Mel-Gibson directed “Hacksaw Ridge.” In one Berlin banner deal, Sony Pictures Worldwide Acquisitions (SPWA) acquired major territories on Ben Wheatley’s action thriller “Free Fire.”

But in general, however, “There’s definitely a caution in the air. It has not been a market with bidding wars and product flying off the shelf. It’s been very methodical,” said IM Global’s Stuart Ford.

Big distributors’ major complaint was a lack of new major marquee draws. “People are having trouble packaging projects. Not many actors can clearly carry a theatrical movie and everybody wants them. Established names are starting to work more in TV and as for the up and coming talent, the studios usually snatch them,” said Tamara Birkemoe at Foresight Unlimited.

“It’s been challenging to package projects. All elements of a package including cast and price have to make sense for a buyer as they have an appetite and need for programming,” said 13 Films’ Tannaz Anisi.

Since mid-2011, the Euro has slid 23% against the U.S. dollar. “Exchange rate issues have cropped up again and again in negotiations,” Ford said, also lamenting disappearing ancillary markets. “A lot of distributors just don’t have the certainty in their numbers and their ancillary values that they once had.”

That said, Berlin was not a washout. “Regarding indie/arthouse films, there’s a huge shift to sell finished movies, not pre-sell — Sundance was the tip of the iceberg — because these kind of movies are so execution-driven,” said Moszkowicz, noting that distributors reduce risk looking for finished movies at festivals like Berlin where they see critics’ reviews, audience reactions.”

Indeed, Richard Linklater’s 1980s college-set “This Is What I’m Talking About” closed Germany with Constantin; Celluloid Dreams’ “Taxi,” The Match Factory’s “The Second Mother,” Films Distribution’s “Mia madre,” Funny Balloons’ “The Club,” Bac’s “Taj Mahal,” Film Factory’s “The Clan,” and TrustNordisk’s “Operation Arctic” all closed sales.

The bottom line, however, is that the international sales biz has now got significantly tougher. “If you talk to sales agents, they will tell you that they are working five times as hard today to make the same money as they did five years ago. Everybody feels the business is getting harder and harder,” said Jean Prewitt, IFTA president-CEO.

“Those days of just slapping something together and showing up in the market are over. Now, it is much more of a 12-month cycle,” said Lotus’ Bill Johnson.