Blumhouse’s bittersweet documentary “A Secret Love” premiered today on Netflix to rave reviews. Simon Pulman represented Blumhouse in its deal with the filmmakers, Briana Hill was involved in the film’s financing, and Calvin Mohammadi and Simon represented Blumhouse in its deal with Netflix. Watch the trailer here.
Pray Away exposes the damage caused by the religious right’s so-called reparative therapy programs that claim to change a person’s sexual orientation or gender identity as told in personal stories of defectors from these programs. Read the review here.
Shown in 8-minute segments, “I Promise” documents the first year of the I Promise School that LeBron James opened in his hometown of Akron, Ohio in an effort to close the achievement gap by creating a new model of urban public education. Executive produced by James and CDAS client Marc Levin, among others, “I Promise” will serve as the public launch of the Quibi platform when it goes live in April. Watch the trailer.
One thing is clear from Sundance 2020: the current market for documentary and quality unscripted projects is extremely strong. Among several eye-catching deals, the $10m paid by Apple to acquire the documentary “Boys State” matched the sum paid by Netflix to acquire “Knock Down the House” in 2019. Concurrently, premium cable outlets and SVOD platforms ranging from HBO, Netflix, Amazon and Hulu to new players HBO Max (scheduled to launch in May 2020), Peacock (July) and Quibi (April) are commissioning a diverse range of quality documentaries, either as one-off pictures or episodic documentary series such as “Cheer,” “McMillions,” “All or Nothing” and “Making a Murderer.”
In the context of this new exciting marketplace, some of the traditional rules have changed. What do producers need to know?
- Contemplate Flexible Formats: Given the rise of episodic content, and taking into consideration the massive amount of footage that documentary filmmakers often create, it is no surprise that there have been several examples of projects that were originally planned as one-off documentary films being reformatted into two-part documentaries or even multi-episode series. Moreover, several projects that were planned as feature documentaries have been reformatted into multiple episodes of ten minutes in order to premiere on Quibi, while other documentary projects have been developed in tandem with a tie-in series of podcasts (for instance, the “McMillions” podcast promises to allow listeners to ‘go deeper inside the story’).
Accordingly, filmmakers should try to structure their deals and negotiate their paperwork in a manner that permits some flexibility with respect to the final form of the project. It is best not to be put in the position of having to determine whether a release that was signed with respect to a “documentary motion picture” would apply to an entire episodic series, especially if the subject at hand is very high level or somewhat tricky (such a subject who withdraws cooperation with the film during the course of production).
- Make Room for Buyers: Traditionally, documentary filmmakers have often adhered to the mantra that “credits are free” when according individual credits and company credits to financiers and collaborators (meaning, that filmmakers will often offer an enhanced credit in lieu of a financial entitlement). However, the new group of premium buyers strongly disfavor logos and company credits, in part because their business is predicated on keeping viewers engaged, and they don’t want people to be discouraged by long opening credits. Accordingly, it is not uncommon to see only one company logo at the top of the production – that of the platform. Filmmakers should bear this in mind, and may want to build in contractual language stipulating that all credits are “subject to network, distributor or other licensee approval” (which has been commonplace in television for some time). Likewise, most of the newer platforms do not approve of according any kind of paid advertising credit to third parties (unless it’s a very high level celebrity-like figure), so filmmakers need to be cautious when agreeing to any such obligations.
- Where’s My Backend?: Most documentary filmmakers (and many documentary financiers) would agree that nobody is in docs for the money. With that said, there have been multiple examples of extremely successful documentaries over the past twenty years that have generated profits for filmmakers and financiers. Under the new structure, whereby the conglomerates that own most of the platforms and outlets are seeking to acquire all rights and build their IP libraries, there is usually one “buyout” payment and no backend profit participation, while other forms of “upside” such as box office bonuses are also effectively rendered moot. Filmmakers need to bear this in mind, and may need to revise their financial structures to account for this (in consultation with experienced counsel, of course).
- Remakes, Remakes, Remakes: The dirty secret of documentary acquisitions is that, at least some of the time, buyers are acquiring the documentaries in order to secure the remake and other derivative rights. The right unscripted material can be fodder for a highly successful scripted series or series of scripted motion pictures – or can be used as the basis for an unscripted series spinoff format. Indeed, circumstances have sometimes arisen where potential buyers have withdrawn their interest in a documentary when it became apparent that remake rights were not available.
Accordingly, filmmakers should pay attention to remake and derivative rights when putting together their projects. They may wish to seek to acquire life rights – or an option to acquire life rights – from subjects, although this is not always possible. They may want to consider how their collaborators and financiers participate in derivatives, if at all. And when it comes time to sell the project, filmmakers should be cognizant of the potential value of derivative rights to certain types of projects. Ultimately, for documentary filmmakers the documentary should come first – but selling remake rights can be a good way to help finance the next doc!
Amid concerns over a weak market and the impact of streamers on the independent film industry, the 2020 Sundance Film Festival closed with the exhibition of several highly anticipated films, some record-breaking sales and the upsurge of important new deal makers. See below for some key trends that emerged from this year’s festival.
Slower Initial Sales
As new buyers continue to flood the Sundance Film Festival each year, including big budget-backed streamers such as Disney Plus and Amazon Studios (which purchased the 2019 Sundance hit comedy “Late Night” starring Mindy Kaling and Emma Thompson for $13 million, to little box office success), the festival has witnessed an overall resurgence of record-setting sales. Nevertheless, opening weekend sales were largely sluggish. Unlike previous years, where multiple sales might be completed during opening weekend, the first sale this year took place four days into the festival and current sales can often take days or even weeks to resolve. Perhaps due to the lackluster commercial performance of films like “Late Night,” distributors are choosing to be more selective and are waiting to view a wider variety of projects before undertaking an expensive acquisition. Slower initial sales could also be attributed to the fact that more films are entering the festival with distributors already attached, like the documentary “Mucho Mucho Amor,” which was acquired by Netflix before the festival opened, or the popular entry “Promising Young Woman” (starring Carey Mulligan and produced by Margot Robbie), which was set up at Focus Features; consequently there are fewer projects in contention.
Genre-Based Films and Documentaries Still a Hit
Initial sales notwithstanding, this year was a big hit for documentaries. Beginning with Netflix’s pre-festival purchase of “Mucho Mucho Amor,” documentaries continued to drive sales at Sundance, perhaps even more so than in previous years. Some of the most buzzed-about films included the star-studded Taylor Swift and Hillary Clinton biopics. Most notably, Apple and A24 teamed up to acquire the Concordia Studio-produced “Boys State” for a staggering $12 million, a new sales record for documentaries at Sundance.
Another standout success was the Andy Samberg-led romantic comedy “Palm Springs,” which set a new festival sales record thanks to a $22 million deal with Neon and Hulu, dethroning the record previously held by “Birth of a Nation” by a substantial amount. The deal reportedly includes an acquisition fee of approximately $17.5 million along with a guaranteed bonus compensation, the details of which have not yet been disclosed.
There are a few possible explanations as to why these record-breaking sales were feasible in the current risk-averse climate:
- First and foremost, it’s worth noting that each of “Boys State” and “Palm Springs” was jointly purchased by a traditional distributor and an OTT streaming service (with exclusive streaming rights) – a split that reduces individual financial exposure and aligns with the existing assets of each buyer. This dual arrangement presents a fruitful venture for both theatrical distributors and streamers that could in fact establish a new business model for future sales, as discussed below.
- In an era of divisive discourse where Sundance submissions have increasingly veered into controversial topics, many of the best-selling films presented a hopeful or positive message. The non-partisan political coming-of-age story “Boys State” depicts the dramatic plot twists of contemporary politics and the importance of civic engagement. “Palm Springs” is a romantic comedy that has been widely compared to the cult classic “Groundhog Day,” a feel-good movie with wide-ranging appeal. Thus, the films offer content that is inherently less risky (indeed, some of the biggest and most successful sales in past years at Sundance were similarly genre-based, such as “The Big Sick”).
Where Does Sundance Go From Here?
What does all this mean for the future of Sundance? On the one hand, the festival’s trajectory seems somewhat uncertain. Unlike Cannes or the Toronto International Film Festival, which benefit from a larger international market, Sundance focuses primarily on small-budget independent films and documentaries, which historically have not performed well at the domestic box office. Moreover, as streamers such as Netflix continue to develop and produce original content, there is less demand for third-party content. In that respect, Sundance may begin to look more like a showcase of distribution-ready films rather than a traditional marketplace.
However, there could be a few potential developments that offer reason to be optimistic about the future of festival sales:
- Streamers Dominate the Market: Digital streaming studios continue to aggressively search for binge-worthy content that will satisfy their numerous subscribers and hopefully attract new ones. As more buyers enter the independent film market every year (with Disney Plus and HBO Max considered major new players), the appetite for content could result in heightened competition in a market that is increasingly dominated by streamers. In turn, this influx could also spur more hybrid deals between streamers and traditional distributors.
- More Hybrid Theater-to-Streaming Distribution: The rise of digital streamers may encourage a symbiotic theater-to-streaming sales model similar to that between Neon and Hulu or A24 and Apple, where traditional distributors control theatrical rights and streaming services piggyback with subsequent streaming rights. Netflix and Amazon seem inclined to focus on delivering hits quickly to their subscribers, rather than in engaging in lengthy and likely non-lucrative theater releases. For instance, Netflix’s “The Irishman” and Amazon’s “The Aeronauts,” two of the respective studios’ biggest recent releases, both had fairly limited theatrical runs prior to streaming. Since streaming services don’t necessarily measure success according to box office performance or other traditional metrics, they are less likely to be willing to invest in expensive theatrical runs and are instead focused on collecting a slate that will boost their subscriber numbers. In fact, according to Jennifer Salke and Matt Newman, heads at Amazon Studios, “Late Night” is one of the top five best performing films on Prime Video and is therefore viewed as a commercial success by the company, despite its box office revenues. Distributors that are exclusively theatrical, on the other hand, would benefit from a streamlined process where streaming rights are simultaneously negotiated and the financial risk is accordingly re-distributed, with streamers fronting a majority of the acquisition cost. (As more details of this year’s biggest sales emerge, it will be interesting to see how distributors who have teamed up share profits, if any). As a result, the bifurcated sale of theater and streaming rights seems like a commercially viable approach for current buyers. Moreover, reduced costs could allow for distributors to partake in multiple sales or even larger individual sales. For all these reasons, the joint theater/streaming sales model may become a key source of growth in festival sales.
- Potential Rise of Episodic Content: Sundance has remained a festival mainly for feature length content and has resisted embracing episodic programming compared to other markets. Nevertheless, with the continued popularity of episodic content and the potential growth of short-form content, this could rapidly change. Quibi, the short-form content mobile streaming platform, made a high-profile appearance at Sundance this year and may become yet another market disrupter following its launch in April.
Regardless of sales, Sundance continues to attract droves of industry veterans and movie enthusiasts alike. Furthermore, the festival’s reputation as a prestigious launching point for rising talent supports its ongoing relevance in the contemporary market. Nonetheless, given the unpredictable trends of the past few years and the ever-evolving digital media landscape, it will be worth keeping an eye on the direction of future Sundance sales, perhaps as an indicator of larger trends in the industry.