The hard sell

Industry pundits have been calling time on arthouse cinema for decades. Their arguments are familiar enough: the old auteurs — Bergman, Antonioni, Rohmer, Chabrol — are all dead and Godard is in misanthropic, Prospero-like retirement in Switzerland; minimum guarantees that sales agents could once hope to achieve with arthouse fare have plummeted; younger cinema-goers may love movies but the days of hardcore cinephilia are over; festivals, rather than being a launchpad for such films, are now the ghettos in which they are most likely to be found, and from which they rarely emerge.

Broadcasters allegedly helped start the rot: over the past two decades, as public TV stations went private and the remaining public stations started competing with private channels, films have been disappearing from the small screen. DVD is still in its death throes.

But speak to international sales agents handling ‘world’ and ‘art’ cinema and they paint a picture which, if not altogether more upbeat, is certainly more complex than the one offered by those predicting the sector’s demise. “There is no black or white answer,” says Philippe Bober, founder and head of sales and production outfit the Coproduction Office, of the challenges facing specialised sales agents.

‘Before the name of the director would be a minimum guarantee of audience. I don’t believe this is true any more’

Nicolas Brigaud-Robert, Films Distribution

What is clear is that the arthouse/foreign-language sector has become ever more hierarchical. At the top of the tree, there are marquee directors such as Pedro Almodovar and Lars von Trier whose new films are still considered events and who distributors still follow with a near religious fervour. Distributors have not even seen the script for von Trier’s next feature The Nymphomaniac and do not yet know the casting — but several have already pre-bought it. “We have so many loyal distributors really supporting Lars and a few others wanting to enter the Lars era,” says TrustNordisk CEO Rikke Ennis. Almodovar’s The Skin I Live In, meanwhile, sold all round the world last year.

But younger, less celebrated arthouse directors do not have such an easy ride. Their work will only be sold, if at all, when it is completed. Ennis says unheralded arthouse dramas are often impossible to sell. “Two out of 10 arthouse dramas have potential internationally. You could say that’s quite typical of what is happening now after the financial crisis. Acquisitions budgets are going down everywhere. A normal distributor who would have bought 10 films a year now has a budget for three.”

Ennis also makes the point that the market for foreign-language films with crossover potential — such as Morten Tyldum’s Headhunters or Andre Ovredal’s Troll Hunter — is increasing and becoming much more competitive, but buyers are turning away in droves from more traditional arthouse film. “As soon as we are talking tragic subjects, hardcore drama or character drama…the distributors have seen it before and they absolutely don’t see a market for it — unless it’s Lars von Trier,” she says.

Frederic Corvez, managing director and founder of French sales company Urban Distribution International, argues that coming-of-age films — perhaps a natural type of story for young directors making their first or second films — are now shunned by buyers.

“I think we derive less revenue overall on average from movies,” says Nicolas Brigaud-Robert, partner of French sales outfit Films Distribution. “This means that to maintain the same turnover, you have to increase the number of movies that you sell.”

These developments are driven by an ongoing shift in the nature of cinema audiences. In the past, Brigaud-Robert suggests, sellers could rely “on a solid base of movie lovers all round the world”. These people have aged and have been replaced by a new generation with a very different relationship to cinema, and who do not necessarily follow directors. “Before, in many countries, the name of the director would be a minimum guarantee of audience. I don’t believe this is true any more.”

Multi-platform future

When the recent UK Film Policy Review was published, one of its recommendations was for a loosening of the windows system for non-mainstream fare — a move already proposed in Denmark. There is already evidence that sellers of arthouse and world cinema are embracing a brave new world of multi-platform releasing. The role of festivals is changing too. Sellers often feel ambivalent about them. “It is great that they keep this pool of movie-lovers alive but on the other hand, festivals are a danger,” says one veteran sales agent.

Says TrustNordisk’s Ennis: “In the world as it was five years ago, having a film in a festival was equal to sales. It is almost the opposite today, at least for some films.” The multiplication of festivals in certain territories risks eating up the commercial market for the films they show. This is one reason why sellers are likely to be far more demanding in the deals they strike, the festivals they choose, and the deals they make with those festivals — and why many are open to day-and-date video-on-demand (VoD) releasing.

‘VoD is efficient and very profitable for big titles… but when you’re small, VoD is not the best media’

Frederic Corvez, Urban Distribution International

Urban’s Corvez argues that it is possible for arthouse sellers to bypass conventional distributors to deal directly with specialist exhibitors or festivals and still turn a profit. He cites the example of Les Grignoux in Liege, Belgium, a specialist cinema that releases arthouse fare directly. “They offer MGs, they send you royalties. They don’t recoup a huge p&a either. So it’s a perfect scale for films with medium or small expectations,” says Corvez.

Arguably, arthouse films suffer less from piracy than mainstream movies. “In some countries, piracy does not prevent us from selling,” Brigaud-Robert says. “Hong Kong and Taiwan are pirated countries but the way [arthouse] movies are released and the people they are released for are not the people who are pirating.”

Though not every territory has as strong a VoD market as the US, or is as alert to the problems of piracy, the recent experience of TrustNordisk with Lars von Trier’s Melancholia offers compelling evidence of the benefits of simultaneous releasing. Magnolia Pictures released the film in the US, putting it out on VoD in advance of its theatrical release. TrustNordisk’s Ennis argues this boosted rather than hindered the film’s box-office performance. By mid-January, Melancholia had reportedly made $1.2m in turnover from VoD and $2m in box office from the theatrical release.

“What is happening right now in the US is going to happen here [in Europe] in two years,” Ennis suggests. “It is a question of cinemas acknowledging that cinema-going will never go out of fashion… it is a question of adapting to a new period.”

There are hints the long-tail theory — the idea that niche movies selling in small quantities can still generate significant profits via new digital distribution initiatives — may actually be coming true. The launch of Netflix in the UK, the increasing prominence of iTunes and LoveFilm, the popularity of specialist sites such as Mubi and the rise in alternatives to traditional pay-TV cannot help but benefit arthouse sellers.

“VoD is very efficient and very profitable for big titles and big names… but when you’re small, VoD is not the best media,” warns Corvez.

In spite of the daunting market conditions they face, sales agents handling foreign-language and arthouse fare are not ready to quit the business quite yet. As Brigaud-Robert puts it, the “appetite” for movies is still there. The challenge is reaching the audience. “You can keep the same product but you can’t [market and sell] the same way. We keep true to who we are. There is a certain cinema we believe is interesting and that will always survive. We can’t just do it the same way we always did and rest on the name of the director.”

For Corvez, the challenge for most players in this sector is simply to stay in business during a time of huge transition, and wait for market conditions to improve. “It is hard, there’s big competition, some countries don’t buy any more — but if we can continue for the next two or three years, then [the crisis] is going to be behind us.”