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Reaching the silver screen: there are plenty of films. The problem is getting them shown. Black filmmakers are finally taking on the distribution challenge. (Business Of Entertainment).

WHEN INDEPENDENT FILMMAKER CARL SEATON RAISED MONEY from investors in his native Chicago, he had the same dream as many other would-be Spike Lees--transforming his vision into Hollywood glory. Yet, despite winning awards and fans at major film festivals in Acapulco, New York and Chicago, the 29-year-old filmmaker was unable to find a movie studio willing to distribute One Week, his comic drama about a bachelor caught in an unexpected fix a week before his wedding. Even solid endorsements from such luminaries as director Robert Townsend didn't sway Tinseltown's powers that be.

"The studios told us that the film was too intelligent for black people; that black people wouldn't get it, and that they didn't know how to market it," says Seaton. "Also, there were no stars."

Enter Film Life Pictures, the New York-based distribution company started by Jeff Friday this past January. An entrepreneur, Friday had launched the 6-year-old Acapulco Black Film Festival with advertising agency Uniworld Group Inc. (No. 2 on the BE ADVERTISING AGENCIES list with $245.79 million in gross billings) and the Black Filmmaker Foundation, the nonprofit organization that supports black independents. After studio executives passed on the film, Friday struck a deal with One Week's producers, Griot Filmworks. Film Life pumped an additional $1 million into One Week--initially budgeted at roughly $1 million--to cover, among other items, advertising and distribution costs. As part of the deal, Film Life and Griot agreed to split box office receipts and ancillary revenues.

To build audience demand and convince theaters to carry the film, Friday employed guerrilla tactics to generate buzz and gain critical marketing data. Through his "micro-cinema" arm, Black Cinema Cafe (BCC), he held free screenings of the film in restaurants, bars, and colleges, sponsored by such major companies as Grand Marnier and the Ford Motor Co. "BCC appears to be just a social event, as there are free drinks and a DJ. But the event is really a test screening," says Friday, who requested audiences to fill out surveys. "Across 12 cities, the screenings generate approximately 2,400 surveys per film. Nielsen [the media research firm] tabulates the results, and the filmmaker and BCC have firsthand knowledge of what people think of the film." One Week received a rating of nine out of 10, giving Friday just the ammunition he needed to persuade exhibitors to show the film.

Friday, who invested $1.5 million in personal savings in Film Life, is thoroughly convinced that his novel approach will work. Maintains the budding mogul: "Because Hollywood passes on films like One Week, it leaves good films on the table for us to distribute."

BREAKING THE CELLULOID BARRIER

Friday sounds like a character out of a film he may well distribute one day: a brash entrepreneur who takes on the establishment so that his vision, and those of others, can reach the widest audience possible. Call it Mr. Friday Goes to Hollywood.

But he's not alone. Never before have so many African American entrepreneurs taken up the mission of breaking the last celluloid barrier: distribution. Using creativity, technology, business know-how, and loads of moxie, a new wave of black distributors is seeking to revolutionize cinema. "We must control our images, our copyrights, and the means of production," says actor-director Tim Reid, who launched Petersburg, Virginia-based New Millennium Studios in 1997 and now sees his company serving as a production, acquisition, and distribution entity for new filmmakers. "I want to work with young black creative talent, creating distribution opportunities that will allow us to share in revenues in a fair manner."

So you can fully appreciate the overwhelming challenge that black filmmakers face, let's cut to the players. For the most part, major studios own the distribution companies--Buena Vista is Disney's; then there's Universal, Warner Brothers, and Twentieth Century Fox--as well as specialty film divisions like Miramax, another Disney company, and Fox Searchlight, a unit of Fox, that control much of the pipeline to movie exhibitors. The so-called "mini-majors," which include Lions Gate and Artisan, represent the next available distribution channel.

Now, take a front row seat to review the process. In order for a film to get into your local cineplex, a film producer strikes a deal with a distribution company. The distribution company licenses the film, determines the number of prints, or copies, to make, and screens the film to buyers representing movie theater chains such as Loews, AMC, United Artists, and Magic Johnson Theatres.

According to Lisa Davis, a partner in the New York entertainment law firm Frankfurt Garbus Kurnit Klein & Selz, there are four primary film distribution models:

* The studio deal. A studio finances a film, owns its copyright, and gives the producers a budget and, possibly, a percentage of the net profits. (In such an arrangement, the filmmaker rarely receives backend payments.)

* The negative pickup model. The producer secures financing when the distributor agrees to purchase the negatives of the film upon completion of production. Back-end payments are usually negotiated with the distributor.

* The exclusive distribution agreement with a mini-major. The distributor gains rights to the film for as long as 20 years, and, in turn, pays the producer an advance. The distributor splits the net profit with the producer after recouping the advance and its P&A (print and advertising) costs.

* The exclusive distribution arrangement with a small distributor. The distributor gives a small advance to the producer, handles the marketing strategy, and negotiates a split of the box office receipts. (For more on black film distribution, go to www.blaekenterprige.com.)

If the distribution company successfully interests a buyer in a given film, it then negotiates the terms of leasing the film to the exhibitor. According to The Movie Business Book, edited by Jason E. Squire (Fireside/Simon & Schuster, $15), virtually every deal between a distributor and exhibitor is a 90-10 deal--the distribution company receives 90% of the box office gross after the exhibitor deducts an "approved house allowance" for expenses. The movie theater owner receives 10% of the gross and all concession proceeds. This arrangement operates on a sliding scale. The distributor earns less of the box office take the longer a movie stays in a theater. For example, by the sixth week of the release, depending on the box office gross, the distributor could receive only 35% of the box office receipts.

Let's go to the third reel. Not only do most distribution companies make money once a film reaches the silver screen, they also obtain significant earnings from merchandising, as well as ancillary rights to distribute the movie on video, DVD, cable TV, broadcast TV, and in foreign markets.

In this process, many black movies--defined here as those with predominantly black casts created by African American filmmakers--never make it off the shelf. Major studios and distributors maintain that such fare has narrow appeal domestically and fails to attract the lucrative foreign market.

Says Marvinia Anderson, president of Anderson International, a Saugus, California-based film and TV sales distribution company: "Films with a universal theme that are easily understood by all cultures will have a better chance of success anywhere in the world. Comedies, black or white, perform well domestically, but have traditionally had difficulty traveling outside the United States."

But there are exceptions to the rule. Comedies like The Nutty Professor with Eddie Murphy and Keenan Ivory Wayan's Scary Movie were blockbusters outside the United States. And, on the independent side, Fred Williamson's Po' Boy Productions (see the sidebar "`The Hammer' Nails Hollywood") and Heid's New Millennium were able to make inroads into foreign territory. In fact, Heid had a better reception overseas when he released his first feature film, Asunder, a thriller starring City of Angel's Blair Underwood and soap opera star Debbi Morgan, in 1998. "We raised half the $2 million budget in foreign markets but weren't able to secure domestic distribution," says Reid. "I traveled to Europe and Africa and met with the buyers. Because of their long and successful track record in TV, Blair and Debbi have high recognition value in certain territories."

Black film entrepreneurs have taken a page from the scripts of Reid, Lee, and the legendary Oscar Micheaux: Get your movie in theaters by any means necessary.

CREATING THE PIPELINE

One way to ensure that black films reach the silver screen is through the creation of your own pipeline. That's what Stacy Spikes did.

Leveraging the success of the 5-year-old Urbanworld Film Festival, and backed by a $15 million investment from Sony and equity from the Black Enterprise/Greenwich Street Fund (co-owned by Earl G. Graves Ltd., the parent company of this magazine), the former Miramax and October Films executive launched a distribution company called Urbanworld Films in the fall of 2000. Urbanwofid Film's mission: acquire independent, commercially viable black and Latin films and distribute them in limited release.

In running his small, nimble operation, Spikes does not offer huge advances to filmmakers but commits to projects not readily accepted by the Hollywood establishment. The reason: Urbanworld's break-even business model allows for "output deals" with Sony's Columbia Tri-Star division and HBO Home Video. This enables it to sell ancillary rights prior to the acquisition of a film. Asserts Kheil McIntyre, Urbanworld's chief financial officer: "I can acquire a film knowing that I have value coming from our ancillary deals and I can leverage those funds to release the film theatrically. This minimizes our downside risk because we've already established a revenue stream value for the film." To reduce costs and ensure profitability, McIntyre says Urbanworld's movies will not likely be released to more than 300 screens nationwide. But even in this model, each film needs a different rollout strategy--a hard lesson Spikes learned after the inaugural launch.

This past April, Urbanworld released The Visit, a drama starring Billy Dee Williams and Hill Harper that cost $1.2 million and received four prestigious Independent Spirit Award nominations and two NAACP Image Award nominations, as well as the National Board of Review's Special Recognition Award. Despite the acclaim, the film grossed a puny $180,000 in domestic revenues.

"We opened the film on 135 screens and our audience didn't have time to catch up with the film," admits Spikes, who believes Urbanworld should have employed a "platform release" model and shown the film in a few select cities so it could build momentum through strong word-of-mouth.

The disappointing performance of The Visit is representative of the challenge of bringing small black dramatic films to the screen when audiences continue to appear hungry for comedies. During the same period, Fox Searchlight released Kingdom Come, a comedy budgeted at $7 million that starred Whoopi Goldberg and LL Cool J. It grossed $23 million.

To meet this challenge, Urbanworld will offer a diversified slate of films, including Punks, a film produced by Tracey and Kenneth "Babyface" Edmonds (who also produced the box office hit Soul Food) for less than $1 million and described as a gay Waiting to Exhale, and the urban drama King of the Jungle with John Leguizamo and Rosie Perez. Says Punks director Patrik-Ian Polk: "We were seen by every major distributor at Sundance but no one stepped up to the plate. The studios automatically assumed that it's not going to be profitable. Add to it that its black gay characters and they feel that the potential is even more limited." Punks is slated for release this month.

Urbanworld also has plans to release Fidel, a documentary on the Cuban leader, For Da Luv of Money, starring the comedian Pierre, and Higher Ed, with rapper-producer Pras and Aries Spears of MAD TV.

To succeed, Spikes concedes that Urbanworld will need marketing muscle. To better position its films, he's tapped New Jersey-based Bazan Entertainment Marketing and Los Angeles-based The DuVernay Agency, two firms with extensive experience in promoting films to black audiences.

FROM THE NET TO THE SCREEN

A number of black filmmakers will continue to look to major studios for financing and distribution. But the Web may be vital to making the pitch--and the sale.

Take Urban Entertainment (www.urbanentertainment.com), the first company ever to sell a Web-based property to a major studio. The Los Angeles-based company, launched in January 2000 by founder and CEO Michael Jenkinson, a former Fox Films vice president of feature film production, used the medium to sell the popular animated Web series Undercover Brother to Universal Studios and Imagine Entertainment for $3 million. Budgeted at a reported $35 million, the live-action film version of the series was produced by UE and Imagine's Brian Grazer. The creative talent includes director Malcolm D. Lee, who helmed The BestMan, and the film's star, comedian-actor Eddie Griffin. Through the use of Macromedia Flash animation, Jenkinson wanted to make UE a distribution and audience-building vehicle for creative properties on the Web and, at the same time, a tool to move them into other media. "My aspiration was to put together experienced storytellers with technicians to produce content that was more compelling than anything else I was seeing on the Web," says Jenkinson.

In order to develop such vehicles, Jenkinson used his Rolodex or A-list talent. He contacted John gidley, writer of Three Kings and supervising producer of Third Watch. "My script for Undercover Brother sat on my shelf for years," says gidley. "Despite my very successful past, Undercover Brother would have never happened without Urban Entertainment."

As in a typical studio deal, UE, Ridley, and Lee received fees for services. Universal will distribute the film, cover all P&A costs, and reap box office receipts from the June 2002 release. The film is expected to open on about 2,000 screens. UE, however, is eligible for bonuses based on box office performance, and will participate in such ancillary revenue streams as merchandising and soundtrack sales.

Jenkinson is using this model to gain financing and distribution for other UE animated series in film development, including gidley's Those Who Walk in Darkness, which is in development at Warner Brothers, and There Goes the Neighborhood, which is being developed by Alcon Entertainment for Warner Brothers.

Jenkinson was able to make a dotcom model work when most companies imploded, including the much-publicized Pop.com multimedia venture led by fiber-directors Steven Spielberg and Ron Howard, Grazer's partner. He initially financed the lean, 10-man operation with $500,000 in personal savings. In late 2000, UE closed its first round of strategic funding from media conglomerate BMG Entertainment and Provender Capital, a minority- and women-controlled venture capital firm in New York. During the summer of 2001, AOL Time Warner purchased a $4.5 million minority stake in UE, and Provender invested another $1 million. Asserts Provender partner Derek Jones; "Unlike other companies in the urban space, they have created a brand and been successful with [few] resources."

UE has entered into lucrative "first-look" deals with New Line Cinema and Warner Brothers Online. Jenkinson has deftly developed a team of well-connected ex-studio execs, including UE President Damon Lee, a former vice president of production at MGM. And, most important, he's formed partnerships with such ace talent as directors John Singleton and Reginald Hudlin

From the Web to independent distribution, more doors may bc swinging open for black cinema. If successful, you'll be able to see new filmmaker's vision at a theater near you.

RELATED ARTICLE: "The Hammer" Nails Hollywood.

Before Schwarzenegger, Snipes, and Stallone, there was Fred "The Hammer" Williamson, 63, the original action hero. The former NFL gridiron star made his name on the silver screen in such blackploitation classics--but don't let him hear you call them that--as Black Caesar and Three the Hard Way.

But the Hammer didn't want Hollywood controlling his image--and, as a result, putting nails in the coffin of his budding film career. So he struck out on his own. "I had an image of myself that Hollywood would not adhere to," he says. "Hollywood wasn't ready for that, so I said, `OK, fine. I'll make my own movie.' And I did."

The self-described black Clint Eastwood launched Po' Boy Productions in 1973, transforming himself into America's most prolific contemporary black filmmaker. He has distributed, directed, produced, and starred in close to 40 films over the past 25 years.

Using his star status, Williamson turned to Europe. "I thought my best bet was to take my concept overseas because I knew that Europeans accepted blacks differently because I had traveled to Europe," Williamson says. "So I started researching the film markets and festivals. I took my concept to Cannes, I set up posters, and t paid pretty French girls $25 to walk around in my T-shirts."

The Hammer's marketing savvy paid off: He presold his first film, No Way Back, financing the movie by selling overseas distribution rights. "The film cost me $75,000, and by the time I left Cannes I had $290,000 in presales," says Williamson of the model he would replicate for his next two films, Mean Johnny Barrows and Adios Amigo with Richard Pryor.

Today, Williamson continues to make movies with an average budget of no more than $1.5 million and European gross box office receipts of $5 million to $6 million, financed mostly through foreign presales. According to Williamson, about 5% of his films play theatrically in the United States, with the remainder going directly to video or cable TV. In his latest Po' Boy projects, On the Edge (2001) and Down 'N Dirty (2000), produced with his wife and partner, Linda Williamson, he changed the financing equation. The productions were financed by Blockbuster.

Williamson's success has made him a popular action-adventure figure overseas, and he argues that black films can be marketable and profitable in foreign markets. Williamson's advice to black filmmakers who venture into foreign territory: "Understand the culture and understand the people you're selling to, and it will influence the kind of films you make." --G.A.
COPYRIGHT 2001 Earl G. Graves Publishing Co., Inc.
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Author:Alexander, George
Publication:Black Enterprise
Geographic Code:1USA
Date:Dec 1, 2001
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