Why Film Distribution Needs Innovation

Why Film Distribution Needs Innovation

As a young entrepreneur working in the movie theater industry, I have found the mechanics of film distribution are inefficient and in need of innovation.

The current system of theatrical film distribution is structured on an antiquated format: Celluloid film. Distribution companies have not taken advantage of the infinite utility of digital technology, and instead remain stubbornly fixed in the blind bureaucracy of the pre-internet Dark Age.

This is a problem that affects all cinema lovers, because it greatly restricts what films are shown on the big screen. It is our mission at Indywood to solve this problem.

Let me explain.

First, a little history . . .

End of the Celluloid Age

When you and I were growing up, every movie we saw was shot on celluloid film.

Everybody loved celluloid! It’s definitely the most beautiful format for shooting and viewing film. However, it was cumbersome and expensive.

Ten minutes of 35 mm film stock cost about $1,500. And because you couldn’t see what you were shooting until it was developed, you had to “shoot perfect.” (And perfection’s never cheap.)

Once a celluloid film was completed, the distributor would pay to make prints of the film – just imagine the cost of making hundreds of prints of a 90-minute film – and then ship those prints to theaters across the country.

Now, films are shot on digital, not celluloid, and the process of making a movie is massively more efficient and inexpensive.

An improvement, right? Well, not for everyone.

The Effect on Small Theaters

Back in 2007, a friend of mine who runs an art-house cinema in my hometown got a letter that would change his business forever.

The letter was from the Big Six – the six studios that dominate Hollywood. They were announcing the death of celluloid film. They had collectively decided to stop printing on celluloid. From then on, films would be distributed on a digital format called Digital Cinema Package (DCP).

The catch: If my friend wanted to retain his access to major Hollywood films and mainstream indie films (distributed by Sony, Fox Searchlight and Focus Features), he was going to have to upgrade to DCP – at a cost of at least $100,000.

The Down Side of DCP

Forgive this passionate outburst, but I say, “F#*@K DCP!”

Here’s why DCP is holding us back:

1.) Cost: The cost of getting the equipment you need for a DCP set-up is so prohibitive it creates an entry barrier for many who want to open a small theater. And it’s put some existing theaters out of business. (My friend’s theater survived partly with help from a community Kickstarter campaign to raise the money for conversion to DCP.)

2.) Control: The glory of digital files is that they can be moved and manipulated quickly and efficiently. But DCP files are highly encrypted, because The Big Six are frightened that their films will be pirated.

3.) Shipping: DCP files are so big (typically more than 100 gigs) that they can’t be transferred online. So distribution companies are still paying to ship physical hard drives to theaters (same as when they shipped celluloid reels back in the day) while you and I are streaming films at home.

So at a time when everything in the film industry is becoming more efficient and less expensive, in the movie-theater business, DCP is holding us up.

The Indywood Model: No DCP

At Indywood, we don’t screen off of DCP. We figure we can run a successful movie theater without it.

Here’s Indywood’s deep, dark secret – our “wizard behind the curtain,” you might say:

Our projector cost $700 – the type anyone could buy at Best Buy – and we screen off of Blu-rays and DVDs.

We use “consumer grade” technology, and it works. For a fraction of the DCP outlay, we’re solving all of the problems:

1.) Cost: Our entire technical set-up at Indywood cost about $2000. If we had had to pay $100,000 to install DCP capability, Indywood would never have opened.

2.) Control: Sure, Indywood can’t screen first-run, mainstream films. But we can screen anything else we want! There are soooo many movies out there. We want to have creative freedom with what we show, rather than being fed first-run films.

3.) Shipping: Okay, here’s another “wizard behind the curtain”: We have screened many feature films that were smaller than 2 gigs. And they looked just fine! You can easily send a file that size online, which is how most of the filmmakers we work with send us their work. What we’re wondering is . . . if we can do this, why can’t the Big Six distributors do it, too? If they compressed their files and sent them to theaters online, they’d radically reduce costs by not having to ship anything! (This topic deserves more exploration, so I’ll expand upon it more in a future post).

Why Do People Come to Indywood?

So Indywood is showing movies off of Blu-rays and DVDs. Sounds like what you do in your living room, right?

Why then, you might ask, would people pay to come see movies at Indywood?

Because they like going to the movie theater! If the image looks good and the sound is clear, what does it matter that we’re using “consumer grade” technology?

People come to Indywood for the atmosphere and the community, not for the “industry standard” equipment.

Maybe our projector isn’t quite as nice as a DCP projector, but you know what? From a few feet back, I can’t tell the difference in quality. Is that difference worth $100,000? If it was, Indywood wouldn’t exist, because we wouldn’t be able to afford it.

But Indywood does exist! And more theaters like Indywood can and should exist!

My Soapbox

This might sound a bit like a conspiracy theory, but I think maybe the Big Six are holding the film industry hostage, using the DCP format.

For years, they controlled distribution, because the cost of printing celluloid was so high. Now, in the digital age, to remain in control, they’ve made the “industry standard” a technology that’s comparably expensive to celluloid.

They’re trying to shackle and contain new technology. But it's not going to work.

We don’t need to be bullied into spending massive start-up costs on needlessly expensive and inefficient technology. We’ve made Indywood work without DCP.

We encourage all entrepreneurial cinema lovers to follow suit!