By Paul Osborne
There’s been a recent battle-cry within the independent film community – lead by folks like Ted Hope and Jon Reiss – urging us filmmakers to publish the revenue generated by our movies, specifically in regard to new forms of distribution. Unlike the weekly box office reports of studio films, the actual figures for indies, particularly those using newer release methods such as Video-On-Demand, are hard to come by. Without them, and subsequently without any way of determining the success or failure of specific releases, it makes perfecting and improving new avenues of distribution quite difficult. How do you know what’s working, and what’s not, if you don’t see the results?
To that end, I’ve decided to share the figures for my new film, FAVOR, which will be released via Video-On-Demand on Tuesday, April 22nd. Obviously I won’t have any VOD numbers for several weeks, so I thought I’d begin by publishing the results of our theatrical engagements, which were all one-night exclusives in various cities. These are hardly massive figures – FAVOR is a small indie flick with no major stars or backing from the “establishment” – but they become quite interesting when compared to those of a “traditional” theatrical release of similar size. Below, I’ve put FAVOR’s box office numbers against the ones for TEN ‘TIL NOON, a movie I wrote and produced that played the same number of markets in 2007, but as a “regular engagement”, playing five shows a day for a full week.
FAVOR and TEN ‘TIL NOON had healthy film festival runs prior to their theatrical bookings, are both crime thrillers with a similar target audience, and each was released using digital elements (DCP and BluRay for the former, HDCam for the latter). TEN ‘TIL NOON cost significantly more to produce – it was shot on actual film – while FAVOR was made digitally and its budget largely crowdfunded.
TEN ‘TIL NOON’s theatrical release was, as mentioned above, a traditional one, with the flick booked to run in a theater for seven consecutive days (Friday thru Thursday), playing five shows per day. It opened at the Sunset 5 in Los Angeles in late March, 2007 and fanned out to four other cities in the weeks following. TEN ‘TIL NOON earned $3,561 in LA and $2,195 in the other markets (the specific figures for each are no longer available) for a total theatrical gross of $5,756.
FAVOR, on the other hand, played five one-night-only screenings, three of which were funneled through theatrical booking service Tugg and the other two arranged directly with the theaters. Here are the results from each city:
Los Angeles: $1,225.00
Seattle: $760.00
New York: $890.00
Shreveport: $958.50
Denver: $960.00
TOTAL: $4,793.50
At first glance the traditional theatrical release seems preferable to the single-night screenings, having outgrossed them by nearly a thousand bucks. This edge deepens when we compare the returns after the theaters take their cut.
Calculating TEN ‘TIL NOON’s returns is easy – the Los Angeles engagement was a 4-Wall (meaning the Sunset 5 theater was rented out in advance) so 100% of its gross there went directly back to the distributor. All of the other theaters had revenue sharing arrangements, but each venue only paid a percentage of the gross after the box office recouped their “house nut” (or operating cost). None of these theaters earned their “house nut” back, so there was no revenue from any of them, leaving TEN ‘TIL NOON’s total returns at $3,561.
FAVOR, on the other hand, saw returns from each theater:
Los Angeles: $200.63
New York: $152.50
Seattle: $131.50
Shreveport: $440.25
Denver: $460.00
TOTAL: $1,384.88
Comparing these returns, the traditional method appears to even more successful, with a total figure nearly 3 times that of the one-and-done screenings.
When you factor in the distribution expenses, however, these fortunes reverse themselves dramatically.
The spend on TEN ‘TIL NOON’s theatrical distribution was roughly $18,400, a relatively low sum for a traditional five city run. The biggest expenses involved publicity and advertising, a certain minimum threshold of which was set in each market by the theater in order to guarantee the booking. If a venue was committing to screen a film for an entire week, they wanted to know the local audiences had a way to find out about it. Soliciting reviews and placing daily newspaper ads were always required.
After deducting the $3,561 return from the $18,400 distribution costs, TEN ‘TIL NOON’s theatrical run generated a net loss of around $14,839.
FAVOR, on the other hand, cost almost nothing to theatrically distribute. The theaters set no marketing or advertising requirements for a single screening, and word was spread to audiences primarily through social media or direct email. All the physical elements needed – the DCP, BluRays, posters and postcards – had already been created for the movie’s film festival run and were readily available. The only tangible expense was shipping, which came to roughly $48 altogether. Subtracting that from the theatrical returns, FAVOR generated a $1,336.88 profit.
The imbalance deepens even more when broken down into how much money was earned per screening. FAVOR ran a total of five shows for an average of $958.70. That’s around 96 paid admissions per event, and with an average seating capacity in each venue of 126, it means that the movie ran in relatively full houses.
TEN ‘TIL NOON, on the other hand, played its theaters for a week – five shows per day, thirty-five shows per week – adding up to a total of 175 screenings during its theatrical run. With a domestic gross of $5,756, the average income per show was under $33. That’s less than four tickets sold per screening.
In the end, the extra expense of a traditional theatrical release seemed to pay for a lot of empty seats. From a business perspective, it appears to be smarter to approach independent cinema engagements the way one approaches booking a band, as opposed to trying to mimic a studio’s methods of releasing a title. And while the moderately higher gross of a traditional theatrical run looks sexier, it certainly can’t compete with actual positive cash flow.
FAVOR hits Video-On-Demand Tuesday, April 22nd, and I’ll share those numbers when they become available.
Paul Osborne is the writer and director of the award-winning thriller FAVOR, which hits Video-On-Demand everywhere on April 22nd, and previously directed OFFICIAL REJECTION, the acclaimed documentary about film festivals. Follow him at www.twitter.com/paulmakesmovies.
TED’s note: If you’d like to read more Distribution Case Studies, Hope For Film has collected over 40 for your reading pleasure.
http://trulyfreefilm.hopeforfilm.com/2013/10/distro-case-study-masterlist.html
