The top 20 independent productions grossed about $50 million during first half of 2009 compared to the July 19 weekend gross of $80 million for the latest Harry Potter sequel. Indie’s US revenues for the first half of 2009 are estimated to be about half of what it was scored last year. Whereas in all of 2008 20 studio films netted more than $100 million, it took only seven month into 2009 to reach that number, thus leading to a significant increase of high grossing studio films. In times of duress more people go to the movies but apparently not to independent ones. Rather the audience settles for the safe and frequently franchised studio fare.

There are numerous problems. First there is an oversupply of ‘independent’ films. Few dispute the fact that a steadily growing number of independent films covering both commercial and artistic productions is flooding film festivals and new electronic platforms. Any domestic or foreign film festival director will attest to the rapid growth of submissions and the attendant problems. The Brooklyn International Film Festival had 2,786 submissions this year though it offered only modest cash and service awards of about $80.000 (in part since BIFF does not have a major corporate sponsor). The politically oriented and community based New York Rooftop film festival drew in excess of 2000 submissions for its 2009 summer program maintaining its financial balance through contributions by its loyal audience. Tribeca scored in 2009 4.720 submissions an amount similar to 2008, though twice as much as in 2003. Sundance had this year 9,300 entries of which 218 screened at the fest but only three were released theatrically.
Numerous factors drive the rapid numerical growth of the US independent film and the problems of marketing these films. For once more and more US colleges and universities train film and video makers. A significant proportion of the close to 4000 institutions of higher education in the United States have programs leading to degrees in film and video productions graduating each year an estimated 15.000 prospective film makers, it nor more. The creation and expansion of these college based film and video programs is not driven by market concerns but by academic considerations. Correspondingly most of these schools though encouraging students to major in film disciplines do not collect data as to how many of their graduates actually work in the industry. Chairs and program directors actually do not want to know their success scores since deans may cut their staff position if only several percent of the graduates secure jobs. Another factor is the declining cost of low budget films. Access to low cost production and editing equipment permit students and academically certified film and video makers to produce low budget films. There is an ever-growing number of consultants, seminars and educational institutions thriving in the film training market, all misleading prospective film makers by implicitly or openly promising entry into the film industry.
The continued rapid expansion of film festivals in the United States and worldwide exceeding probably by now more than 5000 and the rise of distribution technologies resulting in more and more platforms for films, has given some plausibility to the argument that each film has its niche. Yet even here qualifications are necessary. Film festivals are not growing as rapidly as in the past. Major ones experience contractions due to loosing sponsors with General Motors pulling out of Tribeca and Volkswagen out of the Berlinale. It is more difficult to get corporate sponsors since film festivals as marketing platforms are also impacted by the recession. The idea that each film has a niche at a festival or on a new electronic platform may have some factual basis. That this niche, if it can be secured at all, generates in most cases virtually no income is rarely discussed in fee based seminars for young film makers nor is attention paid to the massive problem of securing production funding.

Conveying the illusion that the film maker can now be in control of his/her product by manufacturing an audience for it there is an invocation of digital distribution via Facebook, YouTube, iTunes, video on demand and videostreaming, Amazone’s Createspace, Hula and Indieflix, to name but a few. It certainly is impressive to learn that Myspace has 145 million users and Facebook 250 million. That citizen based videos and democratization of the media are politically desirable can also be debated though it is an old idea that arises whenever a new communications technology comes about. Yet what is lacking in most cases are data about the income derived from digital distribution showing clearly how many film makers derive revenue from having placed their productions on these platforms and what the down load revenue is. There is also the obvious question if those deriving revenues get enough to make a living or at least fund their next production with it.

Placement on a platform will generate results only if the film maker or the platform can create an audience and name recognition for the production which was traditionally derived from theatrical distribution. And there the problem starts. Today few companies acquiring low budget films, thus specialty pick up seems to disappear. Among the remaining ones are Fox Searchlight, IFC, Sony Pictures Classics and the smaller ones Magnolia and Oscilloscope. Gone or cut down are New Line Cinema, Vantage, Warner Independent, and Picturehouse. Thus we observe the problem of not only having enough good films and the new one that there are not enough distributors that can market the few good films. Compounding the problem is the decline of newsprint. Getting to be known through film critics was essential for indie film makers but the decline of print journalism as expressed in shrinking or disappearing publication (Christian Science Monitor) has led to the dismissal of close to 60 film critics last year. Overall, except for the internet, 12 5 of all positions in publishing have been terminated over the last year and a half in the United States. Not being local, internet buzz and the overestimated blogging phenomenon do not have the same impact as the local critic published in print or electronically.

In the funding area Indies are worse off than ever. For once, if there is no prospect that an indie film will be picked up by a studio; there is obvious reluctance by an investor to fund the production. The days of Wall Street pumping billion of dollars in the film business (about $15 billion during 2005 – 2008) and eager venture capitalist looking for projects are over. Given the global credit crunch, the collapse of television markets due to declining ad revenues, and the stronger dollar, it has become very difficult to selling distribution rights in foreign markets. This is aggravated in foreign markets by the success of local movies, frequently heavily subsidized by public agencies, and shifting tastes (possibly except for US blockbusters). Thus there is little in the US production or distribution sector that could enthuse the independent film makers. He can phantasize about Europe where close to $2 billion in public subsidies were spent 2007 in EU countries on film making and more than 700 films produced and a healthy independent film sector exists.
What happens in the United States is modest in comparison. There is Sundance with several new initiatives to foster new productions and fund fellowship, primarily in the documentary area as funded by the Open Society Institute. Two recently announced private initiatives by “indie Studio” and the Gersh agency will fund up to 16 new indie projects and the State of California has in spite of its bankruptcy created a film incentive totaling $100 million for $1 to $10 million projects. Most applicants to date have come from the independent sector. Thus not all hope is lost.

Claus Mueller, New York Correspondent
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