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Glut of Indie Films Divorces Itself From Laws of Supply and Demand

A network executive caused a stir the other day by complaining there was “too much television” out there. He was reacting to the fact that scripted series on cable had almost doubled in quantity over five years.

With the film festival season upon us, on the other hand, it’s the movie folks who might be most worried about the “too much” syndrome. With a profusion of new films on display in Toronto, Venice and Telluride, producers will be hard-pressed to find a niche for their movies in a fervid marketplace, where they’ll be competing against the buzzworthy content on TV.

Ask exhibitors if there’s too much product, however, and they’ll tell you there’s not enough — too few films have the juice to compete in an ever more diverse and crowded media universe. Reflecting this, the acquisition business at fests has become scarier for producers. “When a movie tanks, the distributor always says, ‘I spent only $2 million for the rights,’ forgetting to add that he put $15 million into prints and advertising,” observes a top specialty film distributor.

The super-abundance of TV programming can be traced to the basic laws of supply and demand — the network appetite keeps growing. The increase in indie film production is more idiosyncratic. Basically, there seem to be a lot of people who want to make movies; mostly rich people. While the Disneys and Universals focus on movies with billion-dollar potential, the new class of billionaire investors is willing to aim for more limited payoffs.

A case in point is Broad Green Pictures, funded by billionaire brothers Gabriel and Daniel Hammond, who are co-funding and distributing at least 12 films this year. Most are ambitious pictures aimed specifically at the smarthouse circuit, but their backers are going about it cautiously. Broad Green spent $3 million to acquire “99 Homes” at last year’s Toronto market and, a year later, after warily guiding the film through the exigencies of the fest circuit, will release it this month.

99 Homes” is a socially conscious film about corrupt capitalism — specifically the exploitation of middle-class home owners by real estate hustlers. There’s a degree of irony in the fact that this message is funded by a hedge fund and Abu Dhabi.

While well-funded new entities like Broad Green, A24 and Bleecker Street are stepping up output in the specialty arena, the opposite end of the spectrum — genre films — also is luring investors intrigued by the worldwide horror audience. “Genre films represent the only sector of the business where a good story can make money internationally without star casting or a big-name distributor,” says producer J.D. Lifshitz, who should know.

Lifshitz is a ferociously ambitious film nerd who, at age 22, is about to start production on his seventh genre film. He recently closed a deal with a Hong Kong entity, appropriately called Making
Horror, to further expand his slate. Intense but good-natured, with a keen sense of humor, Lifshitz and his 23-year-old partner, Raphael Margules, are middle-class kids who squandered their
meager savings on a trip to the Cannes Film Festival last year. They spent $6,600 to lease a basement booth to which they dragged prospective foreign buyers to see movies. Their business plan is lean and mean: Their films cost less than $1 million, they take nominal fees, and martial eager (and inexpensive) young filmmakers. Their intent is to challenge established genre rivals like Jason Blum’s Blumhouse.

Filmmaking may be a tenuous business, its economics more haphazard than TV, but its lure is as formidable as ever.

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