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American Film Market

American Film Market
The Path to the Film Making Process in the Multimedia World
By Joseph D. Sullivan Esq.
April 3, 2015

I discovered the filmmaking process is an extraordinary journey not meant for the faint of heart or thin of skin from a recent trip to the 2014 American Film Marketing (“AFM”) Conference held in Santa Monica, California from November 7, 2014 thru November 13, 2014.

Over 6000 people from every continent in the world were at this trade show/flea market for the movie industry.   They were looking to develop relationships/partnerships with a variety of entities in the hopes of obtaining a chance to make their film; obtain financing for their film; obtain distribution; obtain international distribution; find sales representatives and production partners all while avoiding the seedy characters holding themselves out as Industry Titans.  Many folks at AFM are young filmmakers trying to win the lottery with their simple script.  

 What I learned was that the movie industry is very complicated and filled with pitfalls at every turn.  Most folks here are not going to France, Sundance, Canada, Germany, or New York the crème de la crème of the film festivals/tradeshows.  Thus the dream of making it with their project at this bonanza by the prettiest shoreline in America makes those attending all the more hopeful that their horror, comedy, documentary can get funded. Unfortunately, even for these folks, the chances are slim.  But, you have to be “in it, to win it”, so they say.  Here is what most do, to get here:

            1.  Write a screenplay which takes 6 months to 2 years of your life, or pay to have someone write a screenplay.
            2.  Convince the entire world that your screenplay is the best thing since sliced bread. 
            3.  Try and raise money either by:

a)  Family and friends gifting you funds as none of those monies will be returned; 

b)  Selling interest into your production company so that once your production company makes money it will be able to buy the shares in return for those initial investments; 

c)  Obtain loans from friends/investors who will be paid interest and be repaid once the film makes money; 

d)  Partner with a production company that has money to invest in your project;

e)  Option your screenplay, loose control for 5 years and hope purchaser makes the film; 

f)   Partner with a production company that has financing and distributors waiting; 

g)  Raise money on internet sites, kickstarter, et al.; and 

 h)  Get to the Six Sisters and hope they agree to produce your screenplay (the Six Sisters are Warner Brothers, M.G.M., Universal, Paramount, 20th Century and Columbia).

The average film budget of independent films is between $500,000 to $1,000,000.  Once a budget gets created, the top sheet usually delineates a line which separates one group of costs from another.  Obviously there are many exceptions to the following rule, but the below the line costs involve:

            1.         Line Producer
            2.         Director of Photography
            3.         Engineers
            4.         Developing costs
            5.         Fees/Permits
            6.         Bond expenses
            7.         Attorneys fees
            8.         Budget promotion
            9.         Union
            10.       Production Crew
            11.       Food/lodging
            12.       Union issues
            13.       SAG/WGA fees
            14.       Accounting fees
            15.       Transportation
            16.       Administrative fees
            17.       Office rental
            18.       Set designers
            19.       Consultants
            20.       Music
            21.       Licensing fees
            22.       Extras
            23.       Post production costs/editing

            Above the line may include costs for the following:

            1.         Script|Writers
            2.         Directors
            3.         Producers
            4.         Actors

Once the film is properly budgeted (which means there are 10 more things that have not been accounted for which require more funds), then the movie making magic begins.  Fifteen hour days for 28 days of shooting. 

Now that the movie has been shot, the fun really begins with figuring out how to come up with more funds for the following:

            1.         Marketing
            2.         Post production editing
            3.         Distribution / International
            4.         Foreign sales/costs
            5.         Sales Agents costs
            6.         Music



Most distribution companies do not get involved until the project is complete.  As such, the million has been spent on the project, the family, investors, screenwriter are now awaiting the great news of how the movie is going to provide a return. Now you find yourself peddling your wares at this festival in hopes of meeting a distribution company or production company willing to meet with you and pay you for the distribution rights for your project. The deal cut unfortunately puts you in a place in which you may be lucky to make back any money put into the project and an even long shot that the movie brings in revenues in which a profit is actually realized. 

There are 100’s of “vendors” and 100’s of films being shown at this market.  The movies being shown obviously need to be picked up in order to be shown in theaters, which in turn, produce revenues for the distribution company and you.

Many vendors/sales reps this forum seem to be dealing with the international markets, which present another issue, pirating of your film or showing them for example in India for no return to you.

 Intellectual Property laws don’t seem to be as strong in India as in the U.S.A. Who’da thunk it?

Distributors need product.  Some company’s use the paradigm/matrix in which before the movie is made, the movie is sold oversees and presold to markets with named actors attached.  This provides revenues to the company to pay for the production or marketing of the production here in the U.S.A.  It is a formula for success but there seems to be very few in the business that go that route.  Your project will get “laid off” to this company with the hope you’re recovering your costs and then some! 

At various Production Conferences provided throughout the week, it became apparent the reality of getting a film distributed is a long shot.  The movie industry is now on a slippery slope downward with the loss of the D.V.D markets and introduction of the Netflix, Google Play, Hulu and the like.   Perhaps, it’s the alternative media vehicles we now have that the independent movie maker must exploit in order to get its movie out there into the world.  Traditional routes may be gone. If “making it” in movies is making money, perhaps you are better off becoming an accountant.    The costs of marketing budgets have seemed to triple.  If you’re making movies to break even then it’s a hobby not a “profession.” 

Social media/Youtube/VOD seem to be the new route to get movies seen without going the traditional routes.  The movie industry is probably 5 years behind and has not yet figured out this global medium the “Internet” as a way of capitalizing on making movies directed into homes. 

 “Time has become our most cherished commodity.”  The movie experience now consists of traveling to the theater; paying $25 for tickets; $20 for .15¢ of popcorn and soda which seems to be now fit for only the big Blockbuster $100,000,000 budget films.  The Independent Film has a chance of making it, maybe the costs get returned, but it looks like a long journey for the movie maker to make it.

Mr. Sullivan is an Entertainment Lawyer/Producer/Consultant