Shindler's Site: The Search for Critical Mass

In the nearly ten years that I have been involved in LF film, the industry has constantly been striving to achieve critical mass. This has been a frequent topic of discussion at industry gatherings, even if the actual term "critical mass" was not used.

Knowing that the many scientifically literate denizens of the LF world might differ with me in defining the term, I consulted the Merriam–Webster dictionary on America Online. It defines "critical mass" as "a size, number, or amount large enough to produce a particular result; ‘the critical mass of activity needed for a retail store.’"

"Particular result." What could that be? Profits? More theaters? More films in production and release? More organizations involved in the LF food chain? More fresh ideas for stories and production techniques? More industry nominations and awards? More recognition of the format by the general public?

Although I may have used the word "more" in the preceding paragraph more times than was necessary, is it just more of this and more of that? In my opinion, the real answer is more and better.

In the mainstream film industry, with approximately 34,000 screens in North America, "more" does not mean "better." Having more theaters has not always translated into more profits for producers, distributors, or exhibitors. A bad film at thousands of theaters just fails big. A great film in only a handful of theaters may fail small or succeed small. Winning big, in the LF or the conventional world, requires a great film in lots of theaters.

With Everest, Mysteries of Egypt, and T-Rex, LF audiences have shown that they will turn out for "better." Each garnered strong overall box office, and Everest added remarkable video results and respectable ratings on national cable TV. (These two factors add to the format’s recognition in the eyes of the paying public. Despite the Everest example, ancillary markets are still a vastly under-exploited part of the LF revenue stream.)

A critical mass requires more theaters and more production. As I have stated frequently in this column, each begets the other. However, the two segments must be economically balanced, with a mutually beneficial division of income and expenditures. I believe there must be a more viable approach to splitting box office receipts, sharing the costs of advertising and marketing, and a wider disclosure of vital industry information.

Fantasia/2000, although admittedly a unique case, is undoubtedly another step toward a critical mass. Many theaters balked at the 50% royalty fee and other conditions Disney imposed. But those high fees funded the film’s aggressive and professional marketing campaign. Although expensive, it was effective.

I believe that this more balanced financial approach helped put people in the seats, which, after all, is everyone’s goal. Reports from around the world indicate that the vast majority of F2K exhibitors are extremely pleased with its performance. Perhaps one day we will look back at Fantasia/2000 as the film that pushed the industry into a critical mass.

The LF industry is at the brink of a critical mass that could propel us all rapidly into the future. But the industry could also pull back from that threshold and stagnate. Many in the LF world believe that the demise of several companies in recent years was the result of imbalanced supply and demand. As reported elsewhere in this issue, other companies are struggling for survival right now.

Here are some of my thoughts on critical mass as related to the different industry segments.

Exhibition. Today’s LF screen count, split between commercial and institutional theaters, has only become a critical mass in the cases of Everest, a true crossover film, and Fantasia, with its unprecedented royalty split and marketing campaign. In those cases, the economics of large-scale rollouts succeeded. Where such broad-brushed marketing campaigns have failed in the past (or may fail in the future), the culprit would appear to be poor films, ineffective campaigns, or both.

Production. A critical mass of theaters should spark an increase in production. This in turn will entice more filmmakers from the mainstream industry to enter LF production, bringing fresh ideas and concepts to the screen.

Distribution. For distributors, critical mass, combined with a balanced economic model, will fund better and more professional marketing and advertising campaigns. Until just a few years ago, there were few if any unified ad campaigns for LF films. Many theaters’ campaigns consisted of little more than a timetable listing in the local paper. Once there is a critical mass, we will routinely see more comprehensive marketing plans, including national TV ads.

Industry growth for the long-term benefit of all mandates this balanced approach. Without it we will not be able to attract the capital needed to fuel further growth. Potential entrants to the industry will look at the current imbalance and determine that there are better places to invest. With it, we will be well on our way to critical mass.