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Nothing to acquire, so agents and distributors become producers.

The in-house production rate of the majors could satisfy their distribution needs.

The "independent" business, whether one is talking about production or distribution, is in the throes of a downward cycle. All indications are that things could get a lot worse - before they get better.

Some, like veteran producer/international sales agent, Walter Manley, president of Manley Productions, blames the sharp decline in the video business, mainly in Europe, which provides the independents with 65 per cent of their total foreign income. "They are down significantly in Europe and to some degree also in Japan," he noted. "They are still okay in Brazil, Korea and in Mexico."

"However," he adds, "that's not good enough to finance a picture. We used to make quite a few films and simply sell them to video when prices were very good. It had reached the point where many pictures were made for under a million dollars, and a lot of them never saw the light of day theatrically."

Others, like William Shields, chairman of the American Film Marketing Association, said "These aren't so much difficult times, they are changing times. The demand is for bigger, more expensive films with recognizable stars, and it is eclipsing the lower budgeted action-exploitation film."

On the theatrical side, Manley said, "We are now in a position where we must cause pictures to be produced because we simply can't acquire them. There isn't anything to acquire. And the product we make has to be good enough to compete with the majors."

Translated to the world market, this means that the independent film, which is normally lower-budgeted than the releases from the majors, is having a tough time competing with the big U.S. studio pictures, which, as Manley pointed out, "dominate around 85 per cent of the playing time in most countries."

Add to this the difficulties which the independent producers are having in obtaining financing, combined with the upward spiral in marketing costs, and the overall problem becomes painfully clear.

But the sales agents admit that they are finding it increasingly difficult to find pictures to offer to the European distributors. A number of them, like Manley, are now generating their own product supply.

For instance, Manley plans to produce three or four pictures, the first involving a Merchant-Ivory production, to be directed by Connie Kaiserman.

"The idea," said Manley, "is to come up with product which can be pre-sold to the European distributors in the traditional manner, and which the Europeans perceive as having box office appeal.

"It isn't so much a question of budget," said Manley. "In fact, most of the time distributors -- and ultimately the public -- don't care about the budget. People are buying elements -- director, story, stars. They are concerned whether the creators involved have delivered money-making films before."

Manley, like Troma's president Lloyd Kaufman, (which produces and distributes domestically and internationally) noted that the independent production field was seriously narrowing. "Independent distributors today must feed largely off their own productions," he said.

He stressed that there would be the exceptions, and recalled Sex, Lies and Videotape, "which everybody bought, and didn't give a hoot about the fact that it was made on a shoe-string."

Manley and others in the international sales field are the first to admit that the changing patterns in foreign distribution work against the independents, many of whom are largely beholden to the majors and couldn't function without them.

What's more, the in-house production rate of the majors has reached the point where it couldn't satisfy the requirements of their distribution machineries. Studio-financed independent product is basically used to fill the gap, though independent producers often complain that their pictures tend to be given short thrift by the majors if they have to compete with big-budget, studio-produced features. Their negative costs now average in excess of $25 million. The major distributors tend to focus their attention on marketing budgets for these large-scale productions, in part because they need to recoup, and in part because of studio pressure.
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Publication:Video Age International
Date:Apr 1, 1991
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