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Friday, January 27, 2006

Some thoughts on what `Bubble' means for theaters and studios

It isn’t often that owners of movie theaters, who make their money peddling popcorn to Saturday night crowds, root for a new release to fail. But that’s just the position they find themselves in today, with the debut of “Bubble,” by the Oscar-winning director Steven Soderbergh.


The movie is being released simultaneously in several places: on DVD, on a premium cable channel, and in theaters. (The DVD release will be a bit delayed – until Tuesday.) That aggravates theater owners, who are accustomed to having exclusive rights to show a new film for several months. And they’re right to be on edge: “Bubble” could mark the start of a period of brutal, Darwinian winnowing for cinemas. But Soderbergh’s latest production may also be the curtain-raiser for a new era in Hollywood: an era in which presenting consumers with a smorgasboard of viewing options, at different prices but on the same day, will reduce piracy while creating new efficiencies and growth opportunities for movie studios.


Directors and some studio executives have already voiced their opposition to the idea of simultaneous release. Last year, “Sixth Sense” director M. Night Shyamalan told the Hollywood Reporter, “I just feel this idea of releasing everything at the same time is gonna kill us.”


“Bubble” itself seems an unlikely candidate to generate so much angst. Though Soderbergh is well-known for his work on big budget films like “Ocean’s 12” and “Erin Brockovich,” featuring stars like Brad Pitt and Julia Roberts, “Bubble” has a cast of unknowns who’ve never before acted in a movie. It was shot with a high-definition digital camera for a budget of less than $2 million, and though it was shown last year at the Toronto International Film Festival, it hasn’t yet built up much critical buzz. The story centers on the tense relationship between three workers in an Ohio doll factory, one of whom is killed under mysterious circumstances.


The teeth-gnashing in Hollywood started last year, when Mark Cuban and Todd Wagner, technology entrepreneurs turned movie moguls, announced that they’d signed Soderbergh to make a series of six films that would be released in a new way. Cuban and Wagner have built a small entertainment empire, which includes the Landmark Theatres chain of 59 art house cinemas, as well as several production companies and two cable channels that broadcast in high-definition. They felt that simultaneous release would address two problems the movie business faces today.


First, they posited that a big chunk of movie piracy owes to movies not being instantly available for viewing at home or on the run, on devices like laptops or portable media players. Second, they believed that by concentrating marketing dollars on a single release period – rather than splitting the spending between the theatrical release and the DVD release several months later – they could build more awareness for a given film. (On Monday, IFC Entertainment followed their lead, announcing a simultaneous release plan of its own for 24 movies this year, including “American Gun,” starring Donald Sutherland and Marcia Gay Harden.)


Cuban, who also owns the Dallas Mavericks NBA team, has said that professional sports offers a model for the movie industry: fans can experience a game by buying a ticket to attend, watching it on TV, listening to it on the radio, or reading about it the next day in the newspaper. He wanted to give moviegoers a similar array of choices, rather than dictating how and when they could view a new film, as is Hollywood’s custom.


But sports teams pocket lots of money from selling broadcast rights to their games. Theater owners keep only a small slice of the ticket price, and make most of their money selling Milk Duds and other concessions. They’re right to worry about losing their exclusive grip on new films: having to compete with the convenience of watching a just-released movie at home will almost certainly force some of them out of business, especially if other movie studios follow Cuban and Wagner’s lead. (Studios are divided: Disney CEO Bob Iger hinted to Wall Street analysts last year that he believed that movie release models might benefit from some tinkering, but Warner Bros. distribution chief Dan Fellman flatly stated that simultaneously release was “not going to happen” at his company.)


That’s why most theater owners will take a hard line on “Bubble” and other films that 2929 Entertainment, Cuban and Wagner’s company, plans to release in this manner. They’ll simply refuse to show the movies, essentially handing Landmark Theatres an exclusive. (To try to persuade some theaters other than Landmark to show their films, Cuban and Wagner are offering to cut their fellow theater owners in on one percent of the DVD sales.) But if “Bubble” or any of its successors becomes a breakout hit, drawing people to theaters despite its availability in other places, that strategy will backfire on theater owners. Who wants to have boycotted the next “Napoleon Dynamite” or “My Big Fat Greek Wedding” on principle?


If simultaneous release proves viable, the operators of movie theaters will suddenly find themselves in a hyper-competitive marketplace. Some will fail. But others will reinvent the movie-going experience, perhaps by offering cushier seats, more satisfying food, less-sticky floors, alcoholic beverages, and waiter service. (Some may even demand that you check your cell phone in the lobby.) They’ll commit to the latest in high-quality digital projection equipment, and experiment with showing new kinds of content: sneak previews of new TV shows, live concerts, sporting events that don’t appear on television. Some of them may discover that locally-produced indie films can draw an audience in their area, even if they don't warrant national distribution.


But communal movie-going isn’t going away; despite the panoply of home (and mobile) entertainment options available today, it’s still nice to get out of the house once in a while. It’s also likely that Hollywood studios will always give certain big “event” movies a theatrical-only release, to elevate them above the mass of pictures being released in every conceivable format at once. That’ll help movies with Kong-sized budgets turn a profit.


The motion picture industry often views changes to its business first as deadly threats, and only later as opportunities. That was the case when sound, television, home video, and the Internet arrived. While simultaneous release may seem like it endangers the revenues of studios and theater owners, the opposite may be true. Theater owners who figure out how to adapt will continue to be favorite leisure-time hang-outs, and they may discover that they’ve got fewer competitors and larger crowds. Studios that give consumers more choices about how they can view a newly-released film may find that their products play an even larger part in our lives – thanks to viewing in home theaters, on buses, and in doctors’ offices.


Whether or not “Bubble” itself succeeds at the box office, I think its release will be an important attempt at keeping the movie industry in sync with its customers’ demands.


Your thoughts?

6 Comments:

  • You're onto something here: a two-or-more-tiered approach, where 'lesser' films get simultaneous DVD release, and the big-budget monsters get a window in theatres. Since a lot of films these days only make their money back from the DVD release anyways, it seems like a reasonable plan, and the studios could cut marketing budgets since they wouldn't have to re-market a film months later for its DVD release.

    And here's an opportunity: day-and-date releasing, but with the DVD and/or download only available directly from the studio. Weeks later it shows up in Wal-mart and Blockbuster.

    By Blogger D, at 3:00 PM  

  • It's strange to me that so few people have discussed the anti-trust aspects of all of this. Cuban puts up the money for the film, shows it in his theaters, with his DVD company, and on his network. Of course there is no loss for him. Most other studios can't do that though, right? And although Cuban's experiment might be interesting from a tech point of view, it seems as if there is a monopoly issue looming behind all of this. I don't know how the law stands at the moment, but doesn't it seem like advocates for day-and-date releasing are opening themselves up to moving back to a old-style studio monopoly, since the companies that benefit from this method need to own as much of the distribution process as possible?

    By Blogger jfm, at 3:43 PM  

  • I realize it's probably just business in his eyes, but I have to hand it to Cuban for being the first media mogul to really cater to the independent film community. For so long, indie cinema was restricted to rundown, out of the way theaters, with DVD release dates often nowhere in sight. Independent film is becoming more accessible, thanks to Landmark Cinemas and even Netflix, and I'm glad to see the possibilities being pushed further. By simultaneously releasing the film on DVD, movie fans in areas where most indies don't come through will have an oppurtunity to see it. If the film is successful on DVD, theater chains will become more confident about playing other indie films.

    With regards to theaters, Cuban makes the point that filmlovers attend screenings not because it is their only option, but because they love the experience. Fans of Soderbergh, like myself, will probably choose to see the film on the big screen.

    By Blogger Will, at 7:36 PM  

  • I find it hard to have sympathy for cinema chains who have relied on a pretty much all-sewn-up distribution method. Any industry that is churning out highly-marketed films that no one wants to see is asking for trouble from the off.

    My answer for cinemas is here: http://projectorfilms.blogspot.com/2006/01/mant.html

    By Blogger Tim Clague, at 4:59 PM  

  • Theatre owners arew right to freeze out films like BUBBLE. Becuase there is no chance that a film released on DVD and on screen simultaneously will become the next Big Fat Greek Wedding or Napoleon Dynamite. Countless films have failed at the box office, but have found life in DVD, including films like Office Space. But films like Napoleon and Greek Wedding became breakout hits because of their slow burn strategy. To open them to a wide market place from the get go would have been to sign their death warrants. A small film like BUBBLE, an exceptional piece of work by Soderbergh, is intentionally modest. But is alsothe type of film that could have opened small and grown. (It is also a DV movie, and will lose very little at home on the television). Had they released it exclusively in theatres, its per screen avg. would have been a lot larger than 3,000. It would have had a chance to develop buzz, and organically find its audience. As it is now, it is known only for its releease strategy. It'll always be a little film. And it will always be the little film that went to DVD and on demand.

    By Blogger g-money, at 6:11 PM  

  • By Blogger Lorraine, at 10:38 AM  

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