Three months into the Covid-19 pandemic and the short and long-term effects of the virus on the indie film market are starting to present themselves in a more concrete manner.
Home Entertainment is Essential
Now more than ever, at home entertainment is proving essential, in both quality as well as quantity. The leaders of the streaming wars are starting to emerge as are the dominant (and most lucrative) forms of generating revenues for independent content.
In the short term, as people were quarantined at home, distributors began scrambling for finished and deliverable content. any hook they could find into content that dealt with a pandemic or virus was definitely an added bonus.
Still, that did not necessarily prove to be lucrative for producers as the uncertainty of the economy made buyers even more cautious and reluctant to part with cash than normal.
Rather, volume driven digital platforms were scooping up as much “rev share only” content as they could.
As the dust begins to somewhat settle and the world inches back toward business as usual, buyers are starting to see the gap left from nearly a full market cycle left twisting in the wind.
Additionally, the lack of production, which will likely continue for some months, paints a bleak picture of late 2020 and, even scarier, their 2021 pipeline of new titles. Anyone with a decent film in post-production currently is in an advantageous position.
Power is Moving Back to the Producers
The talent agencies, who in previous years seemed to hold more control over projects getting off the ground than ever before, are rapidly relinquishing their power and influence back to the producers. Agents were laid off in waves and the ones who managed to keep their jobs, have struggled desperately to keep pre-covid projects intact.
Producers who have managed to maintain momentum during the lockdown will likely prevail, as talent at every level of the totem pole needs to get back to work imminently. Some of the usual financial and artistic roadblocks may wither away.
Coming out of the quarantine, producers and talent alike don’t want to start from scratch, rather, they want something queued up and ready to shoot.
The biggest change to independent Hollywood looks like it will be the way films are shot, not how they are distributed.
SAG is currently structuring and implementing new “covid regulations” for producers and actors to abide by on set.
Although the full scope of these new regulations is still to be determined, one thing Producers are coming to terms with is that their job just got much more challenging. Not only will covid doctors or “consultants” potentially be a new on-set staple, but reduced numbers of crew and talent will likely be a major restriction.
This means that content may become much more intimate in scope OR utilize and become more reliant on post-generated content through CG and other VFX.
We may also see a new genre emerge in which talent never shares physical space at all.
This is a very bitter pill to swallow for big budget and grand-scope studio films, whereas small indie films will likely get back into production the quickest and begin to thrive again.
The Battle Between AVOD vs SVOD
On the distribution side, a lot of new platforms have been introduced into our homes including the much-anticipated (and much deflated) Quibi, as well as other mainstream contenders such as HBO Max.
One thing has become clear in all of this – AVOD, or ad-based Video On Demand, is clearly emerging as the dominant revenue generator for independent content.
Platforms such as TubiTV and Xumo are rapidly expanding in both geography and quality, and the proof is in the numbers. This is likely why Quibi – despite Chairman Katzenberg’s blaming of Covid-19 – has fallen flat.
SVOD platforms such as Netflix and Disney Plus have proven that the masses have an appetite for paying subscription fees, but adapting that to the potentially explosive short-form market seemed to be a misfire.
Another component, which may have contributed to Quibi’s struggle, is consumer’s desire to be interactive with the content they watch. Other SVOD platforms such as Amazon Prime and HBO Max will thrive simply based on the fact that they’re not necessarily relying on new subscribers, rather the content is a value add to subscriptions to their brand that already exist.
What About Theatrical Distribution?
The last big-ticket item to address is how we will (or will not) embrace the theatrical experience in the United States coming out of the pandemic.
While locked down, a major battle ensued between one of the biggest studios and the largest domestic exhibitor.
In short, the studio, which relies heavily on the commitments of the partner exhibitor, announced a new strategy that would all but eliminate the exhibitor. The exhibitor, holding better cards than anyone realized, fired back, insisting they would cut ties if that were to happen.
Assuming US movie theaters in their traditional form don’t evaporate completely into the pre-covid past, they will continue to serve as a major cornerstone of the business.
For consumers it will be more of an emotional break than a financial one, but I suspect theaters won’t go anywhere. Likely, they will adjust to the new conditions that Coronavirus has forced us to embrace.
That aside – bringing drive ins back would likely be emphatically welcomed by both old and new generations alike.
Things are evolving quickly, as are the new challenges being presented.
One thing is for sure – people still need, want and enjoy movies – now more than ever – and there is a constant demand for new and better films.
That combined with the transfer of power away from the studios and talent agencies means that independent content creators, more than ever, have some ripe opportunities ahead in the very near future.