Studio (Theatrical) Distribution

Although it’s rare for a student film to get studio-level theatrical distribution, it’s worthwhile to understand how it works. After all, studio distribution has brought you the movies you grew up with and may one day bring your film to millions of people. DIY distribution can never attain the audience reach of full-scale studio distribution, which is why the studio system, honed over more than a century, holds so much allure.

There are four components that make up studio distribution: setting the right release pattern; determining the right venues; finding the right date; and finally, playing the film out through every form of audience experience—each one of which is called a window.

Distribution Patterns

The first question in studio distribution is how the film should be released. Should it open simultaneously on 3,000 screens? Should it open on one screen in a major city, and then slowly in more theaters as the audience builds? Should it open in a few theaters in 12 major cities? There are three models for releasing a movie: wide, platform, and limited. Let’s look at each one.

image OPENING DAY

On opening day of a studio release, when your movie is playing on multiple screens, try to go to as many theaters as possible—moving from location to location for each show time. You will learn about the composition of your audience and have an early, anecdotal indication of how your movie is playing. As in politics, there are exit polls and statisticians that can fairly accurately predict the opening of a film based on a few key screenings on opening day on the East Coast.

A wide release opens on 2,000 or more screens on the same day. The widest release to date was The Twilight Saga: Eclipse (2010), which opened simultaneously on 4,468 screens on July 30, 2010—meaning it was playing on one out of every eight screens in the country. Wide releases are reserved for big studio movies with massive marketing budgets. In this release pattern, the opening weekend is the highest-grossing weekend, and ticket sales decline after that. The Twilight Saga: Eclipse earned over 21% of its total box-office gross on the first weekend. The steepness of the decline reveals how well the film will do overall: a decline of 60 percent spells economic gloom, whereas a decline of 50 percent has become almost standard, and a decline of less than 30 percent makes distributors ecstatic. (Movies that decline slowly are said to have “legs” because they can “run” for a long time.) Twilight ran for over 16 weeks. After a wide-release opening, most films lose theaters each weekend. As an example, four weeks after its record-breaking release, The Twilight Saga: Eclipse was down to 3,121 screens. Films will typically make about 40 percent of their total box office returns in their opening weekend alone. Pirated copies of films often begin to circulate after opening weekend, which may also take a toll on box office revenue (see Business Smarts: Piracy, below).

A platform release goes the other way. The film starts in a small number of theaters—10 or less, and perhaps even just one. Often in a platform release, a film is shown in one theater each in Los Angeles and New York City. The strategy is to pack those theaters with excited fans so that the shows sell out. This builds anticipation and greater awareness. The next weekend, the film may expand to 20 screens, and the weekend after that to 100. Platform releases work best for movies with a small niche audience: documentaries, specialty films, and foreign language films. In contrast to wide-release films, a platform release’s box office grows each week. This type of release is a good alternative for smaller distribution companies because they can monitor sales figures closely and spend their marketing budget judiciously; when sales start to fall off, they stop spending advertising money.

A limited release is the smallest release of all; a film may play in only one or two theaters for just a week or two. Limited releases have two purposes. The first is to get reviews from movie critics in advance of releasing the film on VOD, where the distributor anticipates making the most money; most critics won’t review a movie that’s only on VOD, but they will write about a movie that’s in a theater. The critics’ reviews may provide legitimacy, awareness, and some good endorsements. A limited release costs the distributor very little, often $50,000 or less. Of course, in the event of wild success and sold-out houses, the film’s run may be extended or even expanded into a platform release.

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Many of the widest releases of any given year tend to be franchise entries, like X-Men: Days of Future Past (2014) or family-targeted movies like The Lego Movie (shown, 2014). An especially popular film may increase its screen count later in release even if it started out on thousands of screens. The Lego Movie, for example, reached its peak number of screens (3,890, up from 3,775) in its third weekend, after establishing itself as a surprise smash.

The second purpose for a limited release is to achieve Academy Award qualification, which requires that a film be screened in a certain number of theaters for a certain number of days. These rules change every year; if you’re interested in qualifying your film for the Academy Awards, you need to check the Academy’s website before you show your film publicly in any form whatsoever. Filmmakers are heartbroken when they discover they have inadvertently transgressed the rules and disqualified their films!

Exhibition Venues

After the release pattern is determined, the next question involves which theaters the movie should be released in. Where will the audience go to see this movie? Not every audience will go everywhere. Some movies appeal to more urban populations than rural populations; some play better in art houses for niche audiences, and some fare better in the multiplex for wide audiences.

Companies who operate theaters are collectively referred to as exhibitors. Exhibitors may see a movie as a way to sell popcorn and Diet Coke; most filmmakers will disagree: they’ll say the film is there to give the audience an escape or to entertain and inform them. Indeed, audiences do not go to the theater for the overpriced popcorn!

The largest theaters or multiplexes are operated by a small number of exhibition chains. The top four chains in North America are Regal Entertainment Group, AMC Entertainment, Cinemark Theatres, and Carmike Cinemas. Combined, these chains operate half of the 39,000 screens in the United States. (The term screens refers to the number of physical screens, not the number of sites. Because many screens are in multiplexes, the 39,000 screens are only in approximately 6,000 sites or locations.) These venues are the most important for big studio movies that need to open on thousands of screens on opening day.

There are also a number of smaller chains with dozens to several hundreds of screens as well as single-operator, independent theaters. Some of the latter are called calendar houses. Calendar houses book their schedules months in advance, and generally show a movie for only one week at a time. Many art house or specialty films are only shown at calendar houses.

As you may intuit, the choice of release pattern often determines the choice of exhibition venue. Wide releases must secure screenings with the large chains; limited runs can do well in independent theaters, small chains, and calendar houses. A platform release will need a hybrid of both, perhaps beginning on a single screen with a small chain and then moving to many screens with the large chains. Thus, platform releases must be handled with extreme care by distribution professionals who have strong relationships with all the exhibitors, so that they can secure the big-chain screens if and when they need them.

The Right Date

Now that you know the release pattern and the screens you’re aiming for, when will you release your movie? You must weigh two factors to answer this question: When will the audience want to see this particular movie, and when will the screens be available because they have not yet been committed to other movies? If the film is in a special format, such as 3D, will the right format screens be available? Once again, you will see the value in knowing who your audience is. A film directed at students won’t sell many tickets if it is released when they are studying for final exams; on the other hand, if the film is released in June, when school is out and everyone is looking for a joyful escape from academic pressure, the movie will stand a better chance. A specialty film aimed at older audiences may fare best in the spring or fall because it will have access to more theater screens (during summer and holiday seasons, Hollywood blockbusters occupy a far greater share of the screens). A holiday-themed family movie will be well received in November and December but won’t make sense in July.

Typically, studios create their release schedules based on two to four “tentpole” movies each year. A tentpole film is a big, wide release—the metaphor suggests that other movies on the studio’s slate will be protected under the big movie’s tent—that gives the distributor an opportunity to play trailers for its other movies and get audiences interested in them as well. Tentpole films come by the seasons: spring, summer, and holiday. You may have noticed that the most expensive wide-release films generally premiere at these times.

The second factor that studios consider when coming up with their release date is competition, from similar movies and for movie screens. For example, if you are distributing a horror movie, you probably wouldn’t want to release it on the same day as another horror movie that has already claimed the date and started to advertise itself: both movies would be vying for the same audience, and the pictures would cannibalize each other. On the other hand, you might choose to release your film two weeks after the other one, and try to place your film’s trailer in front of the competitor’s movie; by doing so, you would lead the horror audience from one movie to the next and reap the benefits. It is not uncommon for a studio to claim a date two or even three years in advance for a tentpole, even before the film is in production. The release date of July 3, 2012, for The Amazing Spider-Man was announced in February 2011. Six months later, well before the first film came out, The Amazing Spider-Man sequel was set to be released on May 2, 2014. The strategy serves to warn the competition: Get out of our way, or you will be crushed!

Similarly, movies compete for screens. There are certain venues that do particularly well for specialty films, and distributors jockey for position on those screens. The same is true for wide releases. Tentpole releases space themselves a week apart in the summer so that they can have available screens and, their distributors’ hope, easier access to their audiences. This is a big gamble. A tentpole movie can cost $300 million or more, with a marketing budget that can exceed $200 million worldwide. That means studios wager nearly half a billion dollars the weekend one of these movies opens, which is why studio executives plot the distribution strategy with the precision of a military battle plan. No wonder these are high-pressure jobs!

Piracy

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The Hurt Locker is a riveting film about a three-man bomb disposal unit in the Iraq War. It was made and financed independently for $15 million and first screened in September 2008 at the Venice Film Festival. Later that month, Summit Entertainment, a recently formed distribution company, acquired the film and gave it a theatrical release on July 26, 2009. The Hurt Locker went on to win the Academy Award for Best Picture.

Despite its acclaim, the film only made $17 million at the U.S. box office. One reason may be that by the time the movie hit theaters, tens of thousands of people had already seen it by illegally downloading it from peer-to-peer file-sharing sites like BitTorrent. The financiers claimed they had lost millions of dollars because of these pirated downloads and filed lawsuits against BitTorrent and thousands of its users. Five years later, The Expendables 3 (2014) suffered more than 2 million illegal downloads in advance of its opening day.

Piracy—the illegal uploading, downloading, or copying of intellectual property—remains a stubborn problem in the film industry. Filmmakers look with fear at the example of the music industry, which has suffered steadily declining sales since 2001, when pirated music downloads became popular. The Motion Picture Association of America and other organizations have launched public awareness campaigns designed to deter illegal downloads; there is as yet no evidence the campaigns have had much effect. Another strategy has been to release a tentpole film in China, India, and Russia before releasing it in the United States, as those markets are often filled with pirated copies made from the U.S. release by the time the film gets there.

You should also be concerned about piracy, because it is a big problem that will hit you in your wallet if you go into the media business. Illegal streaming can amount to 25–100% of a movie’s worldwide legitimate income;2 in other words, piracy can take that much money away from the people who created the work. As you learned in Chapter 2, when you make any creative work, you have created intellectual property, which you own. If you are going to make your living as a creative person, you need to be able to control who experiences your intellectual property, so that you can make them pay for it if you want to. This is, after all, a business.

On the other hand, some creative artists view piracy as their best friend. In these cases, they don’t call it piracy—they call it publicity and encourage it, because it spreads creative work openly and freely to audiences they could never reach themselves. At a time when independent artists must compete with $100-million-plus marketing campaigns launched by multinational entertainment corporations, viral videos and free downloads offer a ray of entrepreneurial hope that their work might eventually reach larger audiences.

The battle over piracy continues, with partisans on both sides. Some point to the examples of The Hurt Locker and the music industry as rationale for stricter copyright-infringement enforcement; they also note that most pirate sites are for-profit, so the illegal sites are making large incomes, instead of the content creators. Others look at the success of viral videos like Kony 2012, which raised more money for its charity in 10 days than other similar charities raised in 10 years, and music events like Ozzfest, which have offered tickets free and made their money on merchandise, as avatars of a new business model: the more free engagement audiences receive, the more they will pay later for deeper engagement with the artists and their work.

To stay informed about piracy and how it affects you, creativefuture.org, a service organization sponsored by the MPAA, is your best resource.

Windows

In order to make the most money possible with each movie, distributors will play a film out through a variety of platforms, or windows—in theaters, on DVD, on cable, and so on. The sequence continues to change in response to audience reactions and patterns of consumer behavior. Distributors adjust their “windowing strategy” to find the best way to make the most money from a film, taking into account the film’s audience, expected levels of awareness, and want-to-see. This is the area of distribution that is most in flux. Distributors continue to experiment with different formulas for different movies and will likely keep doing so.

In some cases, a theatrical release may be the first window, followed by VOD, digital download, airline and hotel screenings, DVD sales or rentals, pay cable, free television, and so on. This strategy makes sense for a film that can collect significant theatrical box office earnings, like a tentpole movie, or a film that benefits from the prestige of a theatrical premiere, such as a high-profile specialty release. In other cases, a film might play for three weeks on VOD, followed by a limited theatrical run, with other windows following. This latter strategy has been effective at making money for some specialty films, which at times have earned over $1 million from VOD income before ever appearing on a theater screen.

image DETERMINING DISTRIBUTION STRATEGIES

Using three movies opening this week in your city as examples, determine which kind of distribution strategy each is using: wide, platform, or limited release. You can determine this by seeing where each is playing—the kind of theater (big chain or independent)—and on how many screens.

Some specialty films now open simultaneously in theaters and on VOD: this is called day-and-date releasing, and some larger movies are also experimenting with this pattern. Exhibitors oppose this pattern, because they say it diminishes theater ticket sales. Distributors, on the other hand, contend that potential ticket buyers decide weeks before opening day if they will go to a theater to see the movie or watch it at home, and that these two means of collecting income add to each other, rather than cannibalize each other. On this matter, distributors and exhibitors continue to disagree. As technologies continue to change and audience interest evolves, the window sequence will continue to adapt and change.

Marketing and Distribution Pro’s Emergency Kit

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  • image Word-processing software for creating and revising the press kit, plus photo-processing software (such as Photoshop or Photoshop Elements) to crop and adjust photos for public relations purposes
  • image An excellent record-keeping system. You will have multiple drafts of press releases and potentially hundreds of photos. You need to make sure you’re using the most recent, approved press release and photos
  • image Thumb drives, DVDs, and a cloud locker to store and easily transfer marketing materials
  • image A database of all the press you’ve contacted, all the festivals you’ve applied to, and all the exhibitors and distributors you’ve had discussions with. There could be hundreds of these individuals and organizations to keep track of