Everything on Demand

When it hit the film-festival circuit in 2008, video artist Steve McQueen’s directorial debut, Hunger, won the Toronto Film Festival’s Discovery Award, the Cannes Film Festival’s Golden Camera for McQueen, and a British Independent Film Awards Best Actor trophy. Riding a wave of rapturous early reviews, it was picked up by IFC Films for distribution in the United States and opened in New York and Los Angeles on December 5, 2008 — just in time for Academy Award consideration.

Assuming successful runs in the two biggest and most discerning movie markets in the country, Hunger would ordinarily have rolled out to art houses in bigger markets, then smaller markets all across the country; if it did well, it might even elbow its way into some mainstream multiplexes. But Hunger tanked in New York and Los Angeles — maybe shriveling hunger strikers and trembling prison guards in 1981 Northern Ireland were a bit too much as the recession deepened and the holidays approached — so it never made it to many of those other markets.

But Hunger did wind up having a local run in many smaller markets — via cable. For the past two years, the Independent Film Channel, or IFC, has been making titles such as Steven Soderbergh’s two-part bio-epic Che, gritty Italian crime drama Gomorrah, and Israeli-Palestinian drama Lemon Tree available on demand via its cable-TV arm at around the same time they hit theaters. For $6.99 — a good bit less than the going rate at most movie theaters these days — you can sit on your couch and watch movies that have yet to make it to the local art-house theater, and may never arrive.

Meanwhile, if you can type a title, no matter how old or obscure, into an internet-connected search bar and hit return, you can track down a DVD copy, legitimate or otherwise, for delivery to your door. The proliferation of broadband internet means that attaching the word “torrent” to your search may enable you to download the movie straight to your laptop. And that’s just the unofficial traffic in films: In addition to video-on-demand offerings like IFC in Theaters, companies such as web-based movie-rental giant Netflix specialize in delivering DVD copies to your mailbox, or now, directly to your TV. And web-streaming of full-length feature films with decent picture quality is on the rise.

Film lovers have become increasingly accustomed getting whatever they want whenever they want it, and if they can’t get it legitimately, many don’t let that slow them down. As consumer desires and expectations expand, movie studios and online retailers are trying a slew of new technologies and approaches in an attempt to adapt and arrive at the Next Big Thing in home entertainment before the rest of the pack. It’s too early to tell how this will shake out in 10 years time, but film nerds will win out, as will some format or delivery system probably in the works right now. And just as some will win, others will lose.

A lifelong film fan, Mike White is the editor of the film ’zine Cashiers du Cinemart and an occasional contributor to Current sister paper Metro Times in his hometown of Detroit. (He is no relation to the actor/screenwriter/director of the same name.) White has spent years amassing a huge assortment of VHS tapes, laser discs, and DVDs of his favorite movies, often illicit copies of obscure films never available on home video. In the early ’00s, within the network of fans and websites devoted to obscure films, he began to make copies of some of his rarest items for other people.

“After a while it got to the point where I was sending out so many tapes that it didn’t make any sense to keep doing it for free, so that’s how superhappyfun.com was born,” he says in a phone interview.

Through superhappyfun.com, White and a partner sold DVD-Rs of hundreds of otherwise unavailable titles — everything from Japan-only films by shockmeister Takashi Miike to Change of Mind, a rare 1969 exploitation film in which a white man’s brain is transplanted into a black man’s body. And it turns out that it wasn’t just cult titles that people wanted. The full-length version of 1976 TV movie Sybil, starring Sally Field, proved to be a popular request, as was Follow Me, Boys!, a 1966 family film starring Fred MacMurray.

Of course, a “popular” film for superhappyfun.com might sell a few hundred copies. White says the site never brought in more than “pocket money ... it might have helped pay for `acquiring` the movies themselves.” But then, unlike organized pirates who churn out thousands of shoddy copies of hot new releases, White was focused on films, not profits.

“I tried to be the most ethical bootlegger I possibly could be,” he says. “My whole idea was that I wanted to be put out of business, in that all of the movies that I carried were available legally and easily for folks to get their hands on. It wasn’t to my chagrin that I would pull a title because it was coming on Criterion DVD; it was like, ‘OK, finally. Instead of a 12th-generation copy, here it is on DVD for everyone to see.’”

White gave up his part in superhappyfun.com in 2008, in part because of a conflict with his partner, in part because “checking the mail every day to see if I had any cease and desist orders … got to be a little too unnerving.” But the bootleg trade on the web continues, with sites such as Just for the Hell of It (j4hi.com) and Shocking Videos (revengeismydestiny.com) going strong. “Business is still pretty darn good out there for folks,” White says.

“Our goal is to not only put those people out of business, but hopefully in jail,” says George Feltenstein, senior vice president of marketing for Warner Home Video Theatrical Catalog. And indeed, the biggest Hollywood movie studios have become increasingly aggressive about bootleggers in recent years. But even Feltenstein acknowledges that “the best cure to piracy is to make the product available. It all exists because there’s demand.”

To that end, in March Warner Home Video launched the Warner Archive, a retail program with the potential to revolutionize the way studios monetize their film libraries and movie fans score copies of their undersung favorites.

For the past 23 years, Feltenstein has overseen Warner Home Video’s catalog business, releasing and marketing thousands of older titles from the vaults of Warner Bros., MGM (through 1986), RKO Pictures, and other classic studio libraries — more than 14,000 titles in all, stretching back to 1914. And for the past 23 years, he’s been steadily bombarded with requests for titles that haven’t yet appeared on VHS or DVD. Even with what Feltenstein describes as Warner Home Video’s “aggressive” mining of its catalog — which includes everything from A Charlie Brown Christmas to Zabriskie Point — there have always been people willing to pay for obscure titles that it made no financial sense to release.

“Generally, we tend to need to break even at retail at around the 20,000-unit mark,” Feltenstein says. “And if a title can’t make that threshold, it would make the likelihood of a retail release `very small`.” Despite the rise of online vendors such as Amazon, the recent demises of stock-everything retail chains such as Tower Records and Virgin Megastore has made releasing catalog titles even tougher. “There are certain films right now that four or five years ago we would have planned to release to retail, but most of our retailers that would have carried them are no longer in business,” Feltenstein says.

Cue the Warner Archive. Via the program’s web page (wbshop.com/Warner-Archive/ARCHIVE,default,sc.html) consumers can now click on one of nearly 200 titles and counting from the Warner Home Video library and buy a DVD copy of the film, individually burned and packaged in a standard DVD keep case with printed cover art. While Feltenstein might find it hard to justify authorizing the manufacturing of 20,000 units of vérité-style ’70s heroin film Dusty and Sweets McGee, selling individual copies on demand for a profit represents a win-win for consumer and studio alike. “All these little nooks and crannies in our library, they become viable,” he says.

“The dream is that anything that’s in our vault, we can make a copy for a person and have it delivered to their mailbox within five days,” Feltenstein continues. “At some point, every one of our 6,800 feature films and multi-thousand television shows, short subjects, cartoons — anything in our library — will be available to the consumer ordering through the Warner Archive collection.”

Feltenstein stresses that the Warner Archive hasn’t replaced or diminished the studio’s usual release schedule of older titles on DVD and Blu-ray, but allows that it does offer a new way for even the biggest studios to get in on the long-tail game. “I’m told the other studios are scrambling to put this business model into play,” Feltenstein says.

The Warner Archive not only offers DVDs of the films for sale, it offers on-demand downloads of the films for a lower (but not much lower) price. So far, Feltenstein says, download sales have been “basically a blip on the radar — the overwhelming majority of purchases have been for DVD.” (He declined to discuss actual sales figures.)

“I believe that the physical media business is here to stay for a very long time to come — people want to own the movies, especially when you’re dealing with collectible titles,” he says. That said, he adds, “It would be foolish to believe that downloads from our library are not going to be a growing aspect of our business.”

JUST AS PEOPLE HAVE ADAPTED TO music albums as downloaded digital bundles of compressed 1s and 0s, so have people begun to adapt to watching movies on a computer screen, or even the tiny window of a cellphone or MP3 player. Apple currently sells or rents thousands of films through its iTunes online store, and Amazon has followed with its own video-on-demand selection of 40,000 titles. And Netflix has augmented its trademark red envelopes filled with physical discs flying back and forth through the mail with a streaming library of some 12,000 titles, all free of charge to its 10.3 million subscribers (up from 6.3 million in 2006).

“We think DVD rental by mail will continue to grow for five to 10 more years,” says Steve Swasey, Netflix’s vice president for corporate communications, “but ultimately, 15, 20 years from now it’ll all be streaming, and we believe that we’ve got a great stake in the ground for that.”

Indeed, if anything is holding back the explosion of movies streaming over the internet right now, it’s the fact that in most broadband households, the internet ends at a computer. As Mike White puts it, “Most of the time, I wanna watch movies with my wife, so I’m not gonna pull something up on my 20-inch computer screen and say, ‘OK, watch over my shoulder.’”

But internet movie streaming is creeping ever closer to being as easy and appealing as flipping on the tube. A company called Roku manufactures a small black box that, for about $100, transfers streaming web video from Netflix or Amazon to your TV set. Perhaps even more decisive, Microsoft’s Xbox 360 video-game console performs the same trick. More than 11 million Xbox 360s have been sold in the United States, and according to Swasey, Microsoft has reported that more than a million Xbox owners have used the console to watch Netflix streaming. White, for one, has a Roku box, of which he says simply: “I love it so much.”

The titles Netflix offers for streaming tend to be “catalog” films — older films, foreign films, TV episodes, not the current hits — and, at 12,000 titles, a fraction of its DVD and Blu-ray library of more than 100,000 titles. “When we buy the DVD, we own the DVD, but we’re licensing the streaming content differently,” Swasey says. “This is new, and it’s evolving. It’s a whole new economic model for the studios.” In some cases, he says, Netflix doesn’t have a title for streaming because of expense — The Dark Knight doesn’t come cheap for any licensee in any form — and in other cases, it’s a matter of studios not wanting to compromise other licensing deals.

Indeed, those who hold rights to films appear to be holding back online streaming, too. In November 2008, Efe Cakarel launched the Auteurs (theauteurs.com), a website that’s a combination streaming art-house theater and social-networking nexus. “We want to ... take foreign, classic and independent films to the people — and the people are on Facebook and Twitter,” Cakarel writes in an email interview. The fledgling site has formed partnerships with gold-standard DVD imprint the Criterion Collection and the World Cinema Foundation and hosts an impressive array of curiosity-stoking contemporary films from all over the world, but so far it offers a total of 500 films for paid streaming, only 113 available in the United States as of press time.

“The big film studios who own a lot of the classic films still make a lot of money from TV deals and are afraid that doing smaller online deals will erode this lucrative source of income,” Cakarel writes. “For undistributed films, rights holders hold on to the illusion that niche films have the potential to make them rich when released in the U.S. market, and ask for unrealistic prices to show their wonderful films that are destined for small audiences.”

Thus far, the Auteurs can boast 240,000 unique visitors a month and more than 80,000 registered users, though, as Cakarel acknowledges, “not many people have paid for streams yet, but these are the early days for feature length `video on demand`.”

Of course, not all film distributors are so conservative, and video on demand isn’t such a new idea. Cable television — that other fat pipe of information flowing into many American homes — has been offering movies on demand and recent film releases on a pay-per-view basis for years. With the growth of VOD and the wane of theater screens devoted to independent and foreign films, IFC Films launched its IFC in Theaters program two years ago to make its films available on VOD via the IFC Channel to coincide with their theatrical releases. Since the smaller films IFC specializes in tend to roll out slowly nationwide, if they roll out at all (see: Hunger), it’s possible that more people might see a film through VOD than in a theater, even during its “first run.”

“We found that it was very successful in terms of the way we were releasing,” says Arianna Bocco, vice president of acquisitions and production for IFC Films. Not only does adding VOD offer “two revenue streams for all the marketing and publicity we `do` at the time,” she adds, it creates “a wider outreach and wider footprint.”

Bocco declines to offer any numbers, but does note that IFC in Theaters was successful enough that in March 2008 her company launched IFC Festival Direct to bring to VOD new films that weren’t going to be getting anywhere near a theater anyway, from Fear Me Not, a Danish drama about a man taking part in an antidepressant study and suffering from ever more sinister side effects, to Faintheart, a British comedy about historical reenactors.

“We looked at that model and thought, Why don’t we turn this into a bigger distribution strategy and bypass theatrical?” Bocco says. “You’re still spending money to release the movies, but you’re really cutting out the most prohibitive costs of releasing a film `theatrically`, which is the ‘P&A’” — prints and advertising. “There’s some potential that if it does well on VOD that the film could actually make some money for the filmmaker,” she adds with a laugh, “as opposed to what most films do, which is lose a lot of money.”

Bocco points out that, in the past, most films traditionally went (or tried to go) through a long and long-established series of steps: first a theatrical release, then to DVD, then cable-TV pay channels, and finally broadcast TV. “Now we’ve collapsed windows, because people are watching movies in a different way,” she says. “There’s much more choice out there, and as a distribution company we had to adapt to technology and the way people are watching movies.”

That means, in part, that IFC Films has more control and more options for its releases. Hunger may have had all the U.S. theatrical exposure it’s going to get, and would otherwise remain unseen until it arrives on DVD toward the end of this year. But thanks to IFC in Theaters, viewers all over the country — even those who don’t have a local art-house theater — have had a chance to check it out. “The films that we release theatrically, you know they’re great movies, but you don’t have any choice about keeping them in theaters longer,” Bocco says. “But this is a way that films can be extended ... they can have a life on VOD.”  

NATURALLY, THIS BRAVE NEW WORLD OF obscure DVDs ordered up with one click and new films streaming instantly to your home doesn’t excite everyone, least of all those who have done the most to support discerning cinema culture over the past 50 years or so — namely the art-house theater and the serious video store.

George Mansour, now 75, has been booking art-house films since he was 30 years old, so he has witnessed the early waves of foreign films shaking up these shores, the collapse of the old Hollywood studio system and the rise of the independent filmmaker, the advent of home video, and the heyday of crossover “indie” hits. In addition to consulting for New York’s famed Angelika Film Center, he now books 21 screens around the country. Asked if VOD programs like that of IFC affect the business such films do at theaters he books, he answers, “I think it does.

“Magnolia and IFC and companies like that are trying to have their cake and eat it, too — trying to have theatrical runs and also have the money from on-demand,” he continues. “It’s fine for them, but it is cutting into the grosses of the small, independent art houses. I don’t know whether ultimately it’s going to be something that’s self-defeating.”

Neither IFC or Mansour will discuss numbers for box office or VOD take, but Mansour cites recent IFC theatrical release The Girlfriend Experience, Steven Soderbergh’s hotly hyped film about an escort played by porn star Sasha Grey, as a film he suspects may have done better at independent houses if it hadn’t also been available via VOD.

“Maybe if I were a little more Olympian about this idea `I could say`, Well, this is a great way for someone in Lincoln, Nebraska, or some cut-off rural area, to be able to access specialized movies,” Mansour says genteelly. “But why not wait three months, four months? At least give the theatrical run a chance for it to breathe and to generate grosses and to keep the places that advertise and that make people aware of these movies alive.”

“For the kinds of movies we release, I think there’s room for both” theatrical release and VOD, IFC’s Bocca says. “And I don’t think that the theatrical experience will go away, because it’s a social experience. There’s so much more to it than watching a movie on a big screen.” In the long term, she argues, “DVD has a larger chance of being in jeopardy” as a format than the classic art house.

But the DVD itself might not be going anywhere for a while. Streaming may be coming on strong, but Blu-ray technology has given movies-on-disc a boost with its exquisitely sharp picture, rich sound, and boatloads of features.

“I personally don’t see a great rush of people who wanna build a collection of movies on their computer,” Warner Home Video’s George Feltenstein says. “But they want to have them to watch on their 100-foot screen. That’s what Blu-ray offers.” And just as DVD took a number of years to catch on, it will take a number of years to die out says Netflix’s Steve Swasey. After all, he notes, “the VHS tape is still clinging to its last breath of life. You still have Americans with VHS players on their rack and tapes they just can’t part with. DVDs are only 10 years old.”

Mike White just wants to watch more movies, and the format matters less than the fact that he knows they’re out there, out of his reach.

“What about all those films that still aren’t available on DVD, and were never available on VHS?” he asks. “Are we ever going to catch up to that point? Or is that going to be version 4.0, where we actually have that dream that we’ve all had — you know, it’s three o’clock in the morning and I suddenly want to see The General with Buster Keaton, and I can just go to my interface unit and punch a code and there it is. It’s what they’ve been promising us for years. ‘Oh yeah, we’ll have every movie in the world and it’ll download immediately.’ You’ll turn on the chip in your head.”

Lee Gardner is the editor of Current sibling the Baltimore City Paper. A version of this story first appeared in City Paper.

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