The Independent Motion Picture Process

According to the MPAA, The average cost to make and market an MPAA film was $98 million in 2004. With the costs of studio-produced films skyrocketing out of control, independent films are making a profit and stealing the show with an ever-growing outlet for smaller specialty films.

The motion picture industry is a constantly changing and multi-faceted business. The movie industry consists of two principal activities: production and distribution. Production encompasses the development, financing and creation of feature-length motion pictures. Distribution involves the global promotion and marketing of movies in a variety of media, including theatrical, home video and television exhibition.

The majors include the Walt Disney Company, 20th Century Fox, Metro Goldwyn-Mayer, Paramount Pictures, Sony Pictures Entertainment, Universal Studios, Dreamworks SKG and Warner Brothers. The mini-majors include Miramax Films, New Line Cinema, Artisan Entertainment, Lions Gate Entertainment and Focus Features (formerly USA Films). The budgets of films financed, acquired or distributed by the mini-majors are usually lower than films distributed by the majors. Miramax, New Line and Focus are owned by the majors, while Artisan and Lions Gate are independent companies.

Phases of Film Production
DEVELOPMENT is the first phase of Production when a producer packages an idea in order to attract investors. A script is either commissioned or acquired and a budget is developed based upon this initial draft. If the budget seems reasonable, the producer will attempt to secure financing so that the project can enter Production.

PREPRODUCTION. At this time a director, cinematographer, and actors may become attached to the project as selling points. If a film is successful at locating financing, it will enter PRE-PRODUCTION, a preparation phase for the actual filming or Production of the film. At this stage key elements are secured, casting takes place, equipment is rented, storyboards are drawn, soundtrack is being worked on, commitments are sought for talent, the director and crew are hired, and contracts are finalized and signed. During this period all of the scheduling and planning is done for how and where the production will take place. This is a busy time when every detail must be considered so that Production can proceed as easily as possible.

PRINCIPAL PHOTOGRAPHY is the actual Production or filming of a motion picture. It can take from a few weeks to several months, depending on the scope and budget of the film, although principal cast members may not be used for the entire period. Principal Photography wraps when all of the scenes necessary to tell the story have been shot. A second unit will pick-up less critical shots which don't require the direct supervision of the director or participation of the principal talent. Occasionally it is necessary to reshoot scenes after Principal Photography has wrapped.

POST-PRODUCTION follows Principal Photography. The film is edited and synchronized with music and dialogue. Special effects may be added at this point. The motion picture lab will take the original footage and conform it to match the edits made by an editor on a digital editing system. The soundtrack is added and a release print is struck.

DISTRIBUTION. At this point the film is made available for sale to a distributor who will promote and secure exhibition of the film in a variety of markets including domestic and foreign theatrical, home video and DVD, pay-per-view, cable, satellite and broadcast television.

EXHIBITION. The producers may also choose to submit the film to film festivals in order to obtain critical recognition and additional exposure.

Whatever their size and budget range, independent production companies rely on the majors, the mini-majors, and independent distributors to distribute their films, and on the majors, the mini-majors, independent distributors, banks and private investors to finance their films. Independent producers also generally lack the necessary financial resources, personnel and exhibitor relationships to self distribute a film and therefore enter into negotiated agreements to have their films distributed by established distribution companies.

DISTRIBUTION AGREEMENTS. A typical distribution agreement grants the distributor the exclusive right to distribute the movie either worldwide or within particular regions from which the distributor is able to retain as a distribution fee a certain pre-negotiated percentage of the revenues generated by the movie. In certain instances a distributor will pay an upfront amount to the producer as an advance payment against future revenues.

The Motion Picture Market
The motion picture industry has become reliant on independent production companies to produce the bulk of the movies distributed. Moreover, numerous new markets have opened up with the birth of home video, DVD, cable, satellite television, the internet, and the explosive growth of foreign box office receipts. Today, the domestic box office receipts for a typical film contribute only 17% of a film's total revenue. This drop is not the result of a withering domestic box office, however. On the contrary, domestic ticket sales have remained constant. These new "ancillary" markets, including the soundtrack market, have simply added onto the revenue stream for feature films. Foreign countries are extremely hungry for American content. Moreover, over half the theaters in this country are independent and look also to smaller independent distributors for programming.