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Attention, Ted Sarandos: Indie Distributors Have Something to Say To You

Attention, Ted Sarandos: Indie Distributors Have Something to Say To You

Netflix chief content officer Ted Sarandos has recently riled the industry with talk of day-and-date releasing films on the streaming service and accusations that theater owners will “kill movies” if they continue to resist multi-platform distribution.

Yesterday, Ted Sarandos backtracked saying that he wasn’t calling for day and date on Netflix, but was just “calling to move all the windows up to get closer to what the consumer wants.”

Whatever it is that he is calling for, it’s clear that day-and-date continues to be a hot-button issue for the industry.

Of course, we know what the consumer wants: to have as many options as possible and
to see movies when and where they want to as soon as they become
available. But does that make financial sense for distributors and
theater owners?

John Fithian, president/CEO of the National Association of Theater Owners told Deadline that, in fact, Netflix was imperiling the future of movies. But where do independent distributors fit into the equation? Surely, they want their films to be seen by the greatest number of people, but they need to make sure that revenue is generated.

We asked independent film distributors for their response to Sarandos’ keynote and his suggestion that theater owners are killing film by quashing day-and-date releases on Netflix and their thoughts on the future of movie theaters and how we watch movies. Below are their unedited responses:

Mark Urman, Paladin:

God save us from
keynote addresses.  Full of absolutes that become obsolete before you know
it. Nothing and no one can
kill the movies, certainly not the theater owners, many of whom have already
adapted quite successfully to the changing tides.  True, the large
commercial chains have yet to, and treat digital like it’s the Antichrist, but
they have their reasons.

Ultimately, the
audience decides what it wants to see — when, where, and how.  Theaters
must cater to audiences, as do digital distributors. For that matter,
filmmakers must as well.  So, it’s all up to them, or should I say us?

So much change, so
much confusion, but a few good movies are all we need to make things right.  And,
does it really matter how people see them as long as revenue is generated? 

Sorry, but I have no
BIG IDEA; just a lot of small ones, every day, most of them about movies and
how to get them out into the world.

Emily Russo, Zeitgeist Films:

That’s not a surprising perspective to have from Ted.
From my point of view, if that’s his position then Netflix will also have to
change their model for how they acquire product and in general be a more
reliable partner.

Because the theatrical model, for all its risks, is still
where we generate potentially, the greatest rewards for our titles.  Lots
of sea changes going in in our industry, we’re also trying to figure out the
next 25 years (to follow the 25 we’ve successfully navigated).

Dylan Marchetti, Variance:

I understand why Mr.
Sarandos wants every film to be on Netflix day and date. I want every (good)
film to be a Variance release.  But he knows that any resistance here
isn’t to day-and-date releasing, it’s to “day-and-date and also free for
Netflix subscribers.”  Windows are important, and they are a science,
and Sarandos knows that too… if they weren’t, we’d see House of Cards running on NBC at the same time it showed up on
Netflix.  After all, everyone with a TV gets NBC, so aren’t access to all
those eyeballs what’s best for the show?  Not necessarily — because this
isn’t checkers, it’s chess.

But since gauntlets
are being thrown down, how about this one: If Netflix is serious about day and
date movies on their platform, why don’t they do what they did with television
and put their money where their mouths are, go for original content?

I were them, I’d give a million or so dollars to fifteen of the most exciting
filmmakers out there (Manohla Dargis smartly suggested something similar to
this last year).  No strings attached and no interference…make your dream
project and it’ll debut on Netflix, with an appropriate marketing push.

Give it to new school
folks like Terence Nance, Eliza Hittman, Mike Ott, Ava DuVernay, Panos
Cosmatos, Alex Ross Perry, Dee Rees. Give it to old pros like Lynn Ramsay,
Sayles, Araki, Anders, Jarmusch, Linklater.  And don’t forget foreign
filmmakers like Sono, Lanthimos, To, Breillat, Cristian Mungiu… it’s a global
culture now, subtitles aren’t scary.  Don’t get me started on the
possibilities for docs.

Right there, for less
than the price of half a season of House of Cards, they’ll have instantly developed the most
interesting slate a distributor could hope for, and the films are theirs to do
with as they please.  That’s something I could do a roadshow or traveling
festival with, going out the same day it was on Netflix (or even after), and
people would show up for it in droves.  It’d bring more film fans to
Netflix, and would provide proof to the bigger distributors as to whether or
not the Netflix-centric model works.  

Speaking for Variance,
I’m open to any model that is beneficial to filmmakers — both in terms of
visibility and finance– and there’s certainly a model (for the right film) where
Netflix at the same time as theaters is a workable, positive thing… but there’s
going to have to be some creativity in the design of it.  When I talk to
musicians about how putting everything on Spotify has worked out for them,
almost without exception most of them are not happy campers… so I can see why
people are leery about the “all the movies you can eat for $9” model.  It’s
up to Netflix to prove that it’s viable.

Richard Lorber, Kino Lorber, Inc.:

(Ted Sarandos) certainly has earned
the authority to make credible comments that may shake up our industry…but it’s a
distortion to apply his comments across the entire exhibition spectrum…those
of us in the so called “specialty” film world live in a largely
different universe than the studios …our relationship with exhibition venues
and theater owners is more collaborative, even collegial, and occasionally,
happily, mutually opportunistic…for the most part “our” theater
owners are a different breed than the studios’ guys and have a very different
set of gauntlets–no less challenging but maybe not as polarizing…as a board
member of a leading non profit theater, i see the changes from a certain kind
of exhibitor’s perspective too…there’s no doubt that it’s not a pretty
picture for exhibitors in my realm.

But we are encouraged by many
creative initiatives and strategies that the small, smart and nimble art house
guerrillas are pursuing, beyond lazy boy seats and a bar. Whether you see day
and date as half empty or half full — as cannibalization or cross-promotion — It’s
going to take a lot more than protectionism against ancillary overlap to keep
folks going to the movies. I’m rooting for our team, with distributors and
exhibitors on the same side, to keep our mission alive–our company’s tagline
is “experience cinema.”

Matt Grady, Factory

There should be a
separate conversation for Hollywood/big budget films and Indie micro-budget
films concerning Netflix and Theaters. Out of all of the Digital/VOD outlets, I
do believe that only Netflix could negatively effect Box office of
Hollywood level films.

On the indie film
level, releasing films Day/Date isn’t such an issue as  people have
developed habits on how they watch films and certain people will go to theaters
and others will not, while some will watch on Cable VOD and others on iTunes or
Fandor or Amazon or Netflix and the list goes on…I look at getting movies on
Digital/VOD in a similar way as I look getting vinyl LPs into local record
shops, try to make it available everywhere knowing that some shops/outlets will
only sell a couple copies an others will sell many more with out much crossover
in clientele. Also, since press outlets are only likely to cover a film once,
having a multi-platform release is really best for films, allowing the film
will be available while awareness is at a high.

Tim League,
Drafthouse Films, Alamo Drafthouse Cinema

First, let me
preface my statement by saying that I respect Ted Sarandos greatly and am a fan
of what Netflix has built.  That said, his comments feel a bit unfair.
 He’s asking theater owners to open up non-exclusive windows while at the
same time making massive investments on exclusive window content for Netflix.
 It’s not really kosher to shame the theater industry for clinging to
exclusive windows and then shift massive resources to develop exclusive window
content for Netflix.

That said, I do wish
more theaters would be open to supporting day and day releases for indie
. Alamo
Drafthouse is one of the few exhibitors that supports the idea of day and date
and even ultra-VOD windows.  I am a open to this for small movies by small
distributors who don’t have the budget for a massive national P&A spend.
 We have proven that model can work for the right film.  For big
movies with ample production and P&A budgets, however, Netflix doesn’t have
the customer base to offer a studio what they would need to sacrifice the
revenue lost from theatrical exhibition.

I think Sarandos knows this
isn’t going to happen.  It might happen for smaller boutique movies, but
not for THE HOBBIT or THOR.

Ultimately the
studios are going to make the decision that works for them and their
investment.  With big budget movies being made for the worldwide market
and that worldwide market being dominated by theatrical revenue (especially in
Asia), I think the cinema industry is just fine.

If the studios ever
develop a direct worldwide online subscription service for their content, then
I think Netflix will be facing the same challenges as the cinema owners.
 That is a scenario I could foresee sooner than Netflix doing a day and
day release for the next AVENGERS movie.

People have been
forecasting the demise of cinema since the advent of television.  It has
been proven time and time again that cinema is not competing against home
entertainment.  To paraphrase Ira Deutchman from his 2013 Arthouse Convergence
Keynote address, a person make one critical decision on a Friday night: to stay
in or to go out.  Cinema doesn’t compete with the “stay in”
options like Netflix, Redbox or even reading a good book.  It competes
with dinner, bowling, rolling skating, going to a bar, etc, the “go
out” options.  Provided the cinema industry can remain a fun and
compelling option when compared to the “go out” options, we will
remain a healthy industry.  Instead of worrying about what Netflix will do
to our industry, I’d rather see NATO and all the big theater chains focus on
our real challenge: make sure people have a fun time at the cinema.

Eamonn Bowles, Magnolia Pictures:

Theaters aren’t going away and the economy for a large
budget film premiering on Netflix isn’t really practical, so it’s kind of a

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So if he wants to help indie filmmakers, why does Netflix offer only a flat rate of $1500 to distribute their films. Any other platform offers usage based rates. Netfilx is the last place for indie filmmakers to see any profit.

Emile Meyer

I've been reading this topic ever since it was announced.

My two cents, if I may:

I'm from South Africa. Now, culturally, South Africa is a TV-oriented market, so that means that the majority of the people over here will more like than not watch TV than go see a movie. Don't get me wrong: people still go to theatres in droves to go watch the biggest blockbusters and support them, so there is a market here for theatres.

However, over here, we normally get a movie two, three months LATER than most, except for films (read blockbusters) that carry a worldwide release date.

Add to that, we only have two huge distributors who carry the monopoly and a large satellite TV network (read conglomerate) that gets to show movies and TV first. Lately, they've been airing new seasons of shows concurrent to their US release dates; their way of TRYING to curb piracy. In essence, we don't have much choice here, as Netflix and any other online streaming service cannot be accessed from our location. We also don't have smaller theatres run by independent distributors that has the ability to show us the more arty films. Well, we do have an arthouse cinema chain (only 3 of them left in the country, run by one of the two major distributors), but that's it. So, for South Africans, we don't have a lot of options, because if you don't have the money for satellite, you have to resort to going to the movies, renting/buying DVDs and TV shows, or downloading illegally, with the latter not being cool at all.

My point with all this?

It's great to have all of the options (and I'm not judging or envious of this), but what about the little guy who doesn't have these options, at all? It's a great debate to have about making films/content available on all platforms the day it releases, as it gives greater accessibility to all. It won't kill the industry at all as Mr. Sarandos suggested in his first keynote; it'll grow it more and give more people the chance to see and experience films and content that would go unnoticed between everything else that's more mainstream. I mean, in all fairness, every filmmaker wants his/her work to be seen by as many people as possible. As a filmmaker myself, I'd want that, too, however, my debate about this comes from a perspective where I live in a country that has options and isn't necessarily backwards in terms of culture (apart from other, more political things that still are), but who won't be able to benefit from this.

Just my two cents… if I missed the plot (I tend to get overly passionate about things, film being one of them), then that's my piece. :)

Gary Meyer

OK Ted…can we do some marathons of HOUSE OF CARDS, ORANGE IS THE NEW and ARRESTED DEVELOPMENT in our theaters day and date with their Netflix releases?

Interesting that they bought SQUARE but it won't go on Netflix until next year so it can play in theaters first and establish its Oscar worthiness.

Will the Academy change their rules to allow simultaneous theatrical and VOD formats?

marie therese guirgis

There are plenty independent distribs not quoted here. IFC, A 24, Radius, Phase 4, Cinedigm, Strand, Music Box, Gokdwyn, Cinema Guild, to name some…

I am not suggesting that the NYT review all digital/VOD only releases for the reason you state, too many. I am pointing out that theatrical is still the only way to get publicity, for the most part, and theatrical is expensive. Many films are being released theatrically only to secure VOD deals. Theatrical isn't going anywhere.

Robert Maier

As someone who recently experimented with opening a new art film theater specializing in indies and docs, I'm disappointed in seeing all the movies that go so quickly to VOD. Once with Netflix, they have years available. A small theater has just a tiny window– maybe a week or so to promote a film and attract patrons who are so immensely distracted. It hurts when you book a new film, and your patrons say they'll skip it because they just saw it VOD. Small art houses may be the real victim who cannot compete, so except for maybe the 10 largest cities, no one in this country, at least, will never see a film on a large screen, with great sound, and the magic communication that goes on between a group of people watching a movie in a theater. And people do like the theatrical experience, let's just hope enough of them will postpone their desire to see a film, so smaller market art houses can stay afloat. Sorry folks, Netflix is a killer of a great art form of movie theaters. I wonder what percentage art film producers receive? Are they getting killed too?


I don't know Dylan Marchetti, but I love Dylan Marchetti. Definitely an astute observer.

marie therese guirgis

the most interesting aspect of this article is the great number of key independent distributors who would not be interviewed or quoted and why. it is just too tough to write a piece like this when no one wants to potentially alienate such a vital, successful and important business partner. Netflix is in some cases singlehandedly making it possible for distributors to continue to acquire and release movies.

i always say that the 15 years i have worked in distribution, and now production, represent the biggest sea change in the movie industry since the birth of VHS. one of the biggest changes is that independent distributors can no longer afford to lose money on theatrical releases with the promise of making it back in ancillary. theatrical releasing has not gotten any less expensive really, even with the advent of digital projection.

the biggest challenge we face is that the traditional media has not kept up with this massive sea change in how films are consumed. The NYT, for example, only reviews, as a rule, theatrical releases. They aren't reviewing on demand or digital premieres on a regular basis. In order to generate the kind of publicity that companies like Netflix benefit from and that VOD channels value, and in turn to generate consumer interest and eyeballs, the film, for the greatest part, has to be released theatrically, horror films and major cast driven films aside.

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