creativity, technology, business know-how, and loads of moxie, a new wave of black distributors is seeking to revolutionize cinema. “We must control our images, our copyrights, and the means of production,” says actor-director Tim Reid, who launched Petersburg, Virginia-based New Millennium Studios in 1997 and now sees his company serving as a production, acquisition, and distribution entity for new filmmakers. “I want to work with young black creative talent, creating distribution opportunities that will allow us to share in revenues in a fair manner.”
So you can fully appreciate the overwhelming challenge that black filmmakers face, let’s cut to the players. For the most part, major studios own the distribution companies–Buena Vista is Disney’s; then there’s Universal, Warner Brothers, and Twentieth Century Fox–as well as specialty film divisions like Miramax, another Disney company, and Fox Searchlight, a unit of Fox, that control much of the pipeline to movie exhibitors. The so-called “mini-majors,” which include Lions Gate and Artisan, represent the next available distribution channel.
Now, take a front row seat to review the process. In order for a film to get into your local cineplex, a film producer strikes a deal with a distribution company. The distribution company licenses the film, determines the number of prints, or copies, to make, and screens the film to buyers representing movie theater chains such as Loews, AMC, United Artists, and Magic Johnson Theatres.
According to Lisa Davis, a partner in the New York entertainment law firm Frankfurt Garbus Kurnit Klein & Selz, there are four primary film distribution models:
The studio deal. A studio finances a film, owns its copyright, and gives the producers a budget and, possibly, a percentage of the net profits. (In such an arrangement, the filmmaker rarely receives back-end payments.)
The negative pickup model. The producer secures financing when the distributor agrees to purchase the negatives of the film upon completion of production. Back-end payments are usually negotiated with the distributor.
The exclusive distribution agreement with a mini-major. The distributor gains rights to the film for as long as 20 years, and, in turn, pays the producer an advance. The distributor splits the net profit with the producer after recouping the advance and its P&A (print and advertising) costs.
The exclusive distribution arrangement with a small distributor. The distributor gives a small advance to the producer, handles the marketing strategy, and negotiates a split of the box office receipts. (for more on black film distribution, go to blackenterprise.com.)
If the distribution company successfully interests a buyer in a given film, it then negotiates the terms of leasing the film to the exhibitor. According to The Movie Business Book, edited by Jason E. Squire (Fireside/Simon & Schuster, $15), virtually every deal between a distributor and exhibitor is a 90-10 deal–the distribution company receives 90% of the box office gross after the exhibitor deducts an “approved house allowance” for expenses. The movie theater owner receives 10% of the gross and all concession proceeds. This arrangement operates on a sliding scale. The distributor earns less of the box office