Yesterday Chris Anderson over at his Long Tail blog posted some research done by Kalevi Kilkki, Principal Scientist at Nokia Siemens Networks. I don’t really follow the math, but somehow he’s worked out that if there were a lot more movie theaters in the US and an efficient distribution network that didn’t require physically shipping prints to the theater, there would be 60-70% more revenue available to theatrical distributors because they could show a lot more movies with niche appeal. They claim there are 13,000 films shown at film festivals every year and there’s all kinds of untapped theatrical revenue from those films that everyone is just throwing away. Now, you can do a lot of stuff with fancy math that seems reasonable, but this is just ridiculous.
Theatrical distribution is the opposite of niche. The nature of theatrical presentation is that you have to herd a group of people into a particular room at a particular time. You don’t get around that by building more theaters. Have you ever gone to an art house theater on a Tuesday evening? 9 times out of 10 you’ll see 15 people in the audience.
Let’s imagine that there were enough new screens to show every movie available for theatrical distribution, and also assume there’s a network that instantly delivers HD (or better) versions of the films for playback on fancy digital projectors. In the real world, those screens would be built very small and because of the nature of niche interests, the screenings would be even more sparsely attended than they are now. Eventually as you increase the volume, the screens get even smaller and the audience for each screening dwindles to one or two. Do you know what that sounds like to me? It sounds like home video.
Theatrical presentation and home video are not two different things, they complement each other. In almost every case, theatrical is a money-losing advertisement for home video.
Now, if we could get over the stigma of releasing films directly to video, that would really be something. If respectable media outlets would review niche indie movies released directly to video rather than ignoring them and lumping them in with the fifth American Pie sequel then it would be financially viable to release all those movies that don’t make it through the theatrical bottleneck that exists for very real reasons which aren’t going to be solved by technology.
And if you’ve seen even a fraction of those 13,000 movies that supposedly screen at film festivals every year (where does that number come from?) you know that most of them aren’t really of interest to anyone outside of the friends and family of the cast and crew.