Shindler's Site: LF2K

By Marty Shindler

Everywhere one looks these days, newspapers, magazines, TV, and on-line, there are retrospectives and forecasts on every conceivable topic. (One would think that some major event was about to happen.)

Shindler’s Site is no exception. I have never been bashful about putting down what’s on my mind with respect to the LF industry, so here are my thoughts. This column looks beyond Year 2000 to where the industry might be several years hence.

The industry has grown tremendously from its inception, most rapidly in the past five years. I believe this rate of growth and its accompanying evolution will continue unabated for some time.

Looking ahead, we see that several companies will grow beyond their entrepreneurial roots and become professionally managed organizations. With several large companies as players in the industry, competition will be more meaningful and positive in all respects. Industry domination will be a thing of the past. This part of our evolution, although vital, will be painful, as many will not survive the changes, victims of future shock.

Technology will be critical to the future growth of the LF industry. The phrase "e-business or out of business" will apply to us as much as any other business.

Growth will happen all along the LF food chain. Let’s look at a few of those links and project what they will look like a few years into the next millennium.

• The marketplace will continue to attract new players all the time, while weaker links fall by the wayside.
• Certain fallacies will continue to exist. For example, many will still be convinced that their film ideas are new and innovative, and that once produced they will generate a continuing revenue stream. The idea that all LF films are evergreen will still be believed by many.
• There will be more films in development and in pre-production than ever before. Competition is good, and with more screens available, a continuing flow of product is important.
• A few purely commercial LF films will become blockbusters and will turn the heads of the global production community. At the same time, several traditional LF films will break new ground in presenting images and stories about breakthroughs in science. These films will achieve similar box office success.
• A balance will finally be achieved between the needs of institutional theaters and the needs of commercial theaters. (More on that from the exhibition point of view later.)
• Goods and services vital to production will be procured electronically on a regular basis.

• For those with the latest in technology tools, post will be easier. Non-linear editing systems simpler than those in use today will play a big role. Sound, sound effects, looping, and, of course, visual effects will be available on the desktop.
• For those who no longer equate bandwidth with jewelry, sufficient bandwidth will exist to allow transfer of files around the globe quickly and easily. The editor in Los Angeles will work closely with the director, who is in Africa working on his next project, while the score is created in London. Through use of a storage area network (SAN), a thriving new concept in handling data files for use by many, each can access the material they need when they need it.
• Once the film is completed in post, a digital file will be sent to the lab, where prints will be struck for the those theaters still using film projectors. The same file will be encrypted and stored on the distributor’s server, where theaters using electronic projection will be able to download it securely to their projection servers.

• No broad consensus will be achieved on the allocation of box office. Raging debates will continue over the traditional formula, in which exhibitors pay a lower percentage of box office and absorb print and advertising costs, versus the Fantasia 2000 model, in which the distributor pays for P&A, but takes a significantly larger share of the receipts. The deciding factor will be the quality of the picture and the reputations and negotiating skills of the parties.
• Lease negotiations will appear on Web auction sites. The highest bidder in a given locale wins the lease.
• There will be many more ways to earn revenue on LF films. In the ’90s, distributors did not significantly exploit ancillary revenue streams, but this will change and films will regularly appear on TV. In fact, an entire network will be devoted to LF films, allowing aficionados to watch at home 24 hours a day on their giant, flat-panel, high-res monitors.
• The once-heralded 500-channel universe will be forgotten. In the future, there will be literally thousands of channels, each after its own niche and market share. And the same bandwidth that made it easy to share files now allows for movies on demand, all paid for with a click of your wireless infrared mouse. The system already knows your credit card number and handles the transaction over a totally secure network.

• Critical mass will be achieved. Theaters are no longer located only in larger cities. Institutional and commercial theaters alike will spread to every suburb and beyond. Enough new films will be made each year to meet each segment’s needs. Balance and harmony will be achieved.
• Distribution of a theatrical release will rely on network advertising, made feasible by the growth in new theaters. The Internet will be of paramount importance in the marketing of all films, LF or conventional.
• Concession revenue is still the financial mainstay of the theaters.

• Technology is at its best in communications tools. We will have information of all kinds available at our fingertips.
• When Universal Studios announces in late 1999 that their web site will include up-to-the-minute worldwide box office and home video data, the rest of the industry quickly follows suit, even the holdouts in the LF industry. Everyone wakes up to the fact that information sharing benefits everyone, and secrecy benefits no one.

We all have visions of the future. This is my perspective. Where do you see the LF industry going?

Best wishes to all for a happy and healthy holiday season.