Monday, 17 September 2012


We've got questions... lots of questions... we got lots and lots of questions....

Okay, I got three questions, two on the same topic. But hey, I love shining the light of my brilliance into the shadowy nooks and crannies of your ignorance as I do exaggerating. So let's get this ball rolling.
Dirty Dingus McGee asked... What are your thoughts on crowdfunding movies? Do you believe it may become significant, shake up the system and eventually force Hollywood to rethink their ways?

Kitty Cat said... i too, would love to hear your thoughts on the Kickstarter model---
Good question Dingus and Kitty, and I'll try to answer it for you.

I'll start off with a brief explanation of crowd-funding for my cave dwelling readers, of which there are quite a few.

Let's say you want to make a movie and to do it completely independently.
Filmmaker Mittens C. Jones sets up his Kickstarter page.

But movies are expensive to make, so what do you do?

Well one option is to go to a website like Kickstarter and you ask visitors to the site to donate money to your project.

Some projects offer premiums to the bigger donors. In the case of a feature film it can be a copy of the DVD, credit as a "producer," or a chance to meet the stars.

If they raise the money in the time allotted, they can then use said cash to make the movie.

Sounds great, and it is a great way to get a low budget film made, but there's a catch.

Making the film is one thing.

Making money from the film is another.

To make money from a film you need the means to get that film in front of audiences via theaters, home video and television.

All those outlets are dominated by the big media companies. Theaters are dominated by blockbusters, the stores that sell DVDs are interested in filling shelf-space, and TV outlets, networks, cable, and "on-demand" services want big names from big studios.

And let's not forget the costs and problems of advertising and marketing a movie.

Films are made to be seen, and if they don't get seen in ways that make money, you're essentially asking Kickstarter's visitors to give you money to play with. Even with donations people expect some sort of return on their investment, even if it's the purely emotional sense of satisfaction of helping someone accomplish their dream.

But it's not all doom and gloom.

The big studios are reducing their output, leaning more and more towards big budget fantastical blockbusters. Meanwhile the outlets for media, like theater screens, and video outlets have grown, and are starting to notice big gaps in the entertainment coming out of Hollywood.

The studios aren't interested in filling these gaps, because those films don't break box office records, and they don't move toy lines. So there may come a time when lower budget movies that have a built in fan-base in their "kickstart investors" can find a home on people's screens.

If that happens there's a chance that such films and filmmakers can be a self-supporting independent industry, operating outside of Hollywood, and eventually work without the need for established talent to seek crowd-sourced donations.

Will it change the way Hollywood does business?

The odds are stacked against it, at least for now. Hollywood studios exist in a weird financial universe of their own. A universe that's padded and protected from the vicissitudes of reality by their bulk and the greater bulk of their parent companies.

Blast Hardcheese asked... One thing I don't understand is why a studio (small or large) finally doesn't say 'heck with it' and start running themselves like a real business. Once they establish themselves as stand-up guys & gals, I would think they'd get a stampede of talent to their door.

Or is it that all of the studios are too absorbed into various Borgian collectives?
The thing about saying "heck with it" and running the studio like a proper business that is really confusing is that it was done before, and it worked.

The 1950s and 1960s were a time of decline for the major studios that mirror today's situation. Attendance was down because of competition from TV and the studios tried to counter it by making fewer, but bigger and more bombastic films than they did before.

While other companies suffered, one company prospered.
Since its founding by Hollywood heavyweights like Charlie Chaplin and Mary Pickford the United Artists company had been an iffy financial proposition.  Where the majors generally chugged along steady, UA fell victim to rapid boom-bust cycles that were mostly bust. 

Then in 1951 two lawyers turned producers Arthur Krim and Robert Benjamin took over management, and eventually ownership of the company from its founding partners. During this time they radically reformed its business model, becoming both simple and successful.

UA would partner with independent producers who were unhappy dealing with the big studios. They kept their overhead low, and operate either as your distributor, handling your films for a set fee, or as an investor/partner. Most importantly, if the film made money THEY DIDN'T SCREW YOU.

This meant that everyone went to UA first with their projects. The big producers UA did business with got bigger, and made United Artists bigger too. Suddenly the little company that had to struggle to survive was cash flush and Hollywood's best investment. They even took over MGM's distribution after the company's first round of insolvency.

Alas, it was not to last.

United Artists was bought out by a big conglomerate, the management changed, and with it the business model.

United Artists started to run more and more like a traditional Hollywood studio. The independents who formed the basis for their success started to move away. This made the company increasingly fragile, until the collapse of the bloated Heaven's Gate drove them into bankruptcy, its takeover by MGM and its current moribund state.

The classical Krim-Benjamin model does work, but for it to be implemented the Ivy League MBAs who run the studios would have to sacrifice some of their turf, their power, and their perquisites.

Maybe we can crowd-source funding for an independent financier/distributor along the classic United Artists model?

Anyone got a few billion to spare?


  1. Here is a question for you, D. I just watched The Raid: Redemption, from Indonesia. It cost a little over $1 million to make. It retroactively ruined The Avengers for me, because its action scenes were about 20 times better. Why does it cost us 220 times more to make a movie 5% as good? What the HELL is wrong with us?

  2. Blast Hardcheese19/9/12 10:11 am

    Hi Sandy,
    Not to steal D's thunder, but a few reasons for bloated budgets are:
    1) Star salaries.
    2) CG isn't as cheap as everyone thinks. (Needs lots more manpower than you think)
    3) Star salaries
    4) Iron-fisted control of the actual shoot by unions (again, lots more manpower b/c everyone's second cousin gets a job)
    5) Star salaries
    6) There is no number 6
    7) Star salaries