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As Netflix And VOD Steal Moviegoers, Small Theatrical Distributors Struggle

This article is more than 6 years old.

Christian Bale, Oscar Isaac, and Charlotte Le Bon in 'The Promise'

Photo by Jose Haro - © 2017 Open Road Films

Barring a miracle, this weekend's release of Terry George's The Promise is primed to be the next movie to open in (as of this writing) 2,000 theaters and yet fail to crack $10 million domestic. That's not a slight against a movie I have yet to see, which is a big-budget romantic drama set during the Armenian genocide that took place during World War I.  The $100m production stars Christian Bale, Oscar Isaac and Charlotte Le Bon and is the kind of movie fated to be more written about than actually seen. And, again, barring a fluke for which I will gladly eat crow on Monday if I'm wrong, it will be the latest whiff from Open Road Films, the studio that won a Best Picture Oscar two years ago for Spotlight. This is a grim time to be a smaller theatrical distributor.

I don't mean to pick on Open Road. They are just one of a handful of smaller and newer distributors like STX Entertainment, Broad Green Pictures and Bleecker Street that have popped up in the last few years, primed to offer the kind of films that the bigger studios don't distribute as much anymore. Yet their arrival coincides with a huge shift in consumer habits, a shift that sees more and more moviegoers spending their box office dollars on fewer movies.

With an explosion in so-called "peak TV" offered by cable and streaming services and a deluge of video-on-demand cinematic choices (to say nothing of Netflix's ravenous appetite for feature films) each and every weekend offering the same kind of smaller-scale fare as the likes of Broad Green and Bleecker Street, it is harder than ever to get consumers to actually go to a movie theater to see something that isn't a blockbuster.

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The notion of films that once would have been mainstream studio programmers dying in platform release isn't a new one. Whether it's Michael Douglas's Solitary Man ($4.3 million in 177 theaters back in 2010) or Cedar Rapids ($6.8m in 462 theaters back in 2011), the notion of a star-driven, mainstream dramedy barely making a blip in theaters has long vexed me. So at first the emergence of VOD as a viable secondary distribution network, a place for films like The One I Love or Margin Call to be seen in a high-quality presentation by anyone with an internet connection and a credit card, was rather encouraging.

But a bunch of smaller distribution houses popped up right as audiences started staying home for more and more kinds of films.

Over the last few years, especially in the last two years, we've seen a deluge of seemingly mainstream movies from all studios (Rock the KasbahA Cure for Wellness, Black Hat, We Are Your FriendsThe Brothers Grimsby) die horrific deaths in wide or semi-wide theatrical release. Fox can take a Victor Frankenstein because they have The Revenant and Deadpool on deck. It's a lot tougher for the smaller folks to withstand flops when A) they don't have the conventional tent poles and B) the kinds of films in which they specialize are the very sort of thing that audiences aren't seeking out in a multiplex.

It's great to say that you're the home of somewhat prestigious dramas like The Infiltrator or The Secret in Their Eyes, but it's tough when audiences seeking such fare have a deluge of options at the touch of a button at home. And that's assuming (optimistically) that they plan to catch up with Miss Sloane on VOD or DVD.

There are exceptions, to be sure. STX scored huge with Bad Moms, which was exactly the kind of star-driven, genre-friendly mainstream release that was supposed to be the kind of thing they offered. A24 has scored with challenging fare like MoonlightThe Witch and The Lobster just over the last year or so. But for A24, the best-case scenario is a $25 million+ domestic gross and they too have watched the likes of Green Room barely make $3m domestic and allowed plenty of films to go direct to TV before a token theatrical release.

By the way, next time you read about some movie starring Shia LeBeouf or Emma Watson making pennies in theaters, ask yourself if that film was actually a commercial endeavor or an indie film with a VOD-centric release. There is a big difference between Matthew McConaughey flopping with Free State of Jones as opposed to Gus Van Sant's The Sea of Trees.

The cruel twist of fate is that the handful of smaller-scale distributors that popped up to offer what Hollywood (allegedly) failed to provide got screwed by a massive shift in consumer habits which saw television and streaming filling that void. Walt Disney can survive Queen Of Katwe making just $10 million worldwide because of that whole Marvel/Pixar/Lucasfilm thing, and I hope they keep distributing such fare if only as a mitzvah. But when movies like STX's Edge of Seventeen and Open Road's Before I Fall barely crack $14 million domestic less than three years after Warner Bros.' Before I Go snags a $12m debut and $50m domestic total... Well, that's a problem if Before I Fall is one of your bigger releases in a given year and it's not just about big studios versus smaller studios.

Some, like Broad Green Pictures, got screwed right out of the gate, with only a single real hit (A Walk in the Woods with $29 million domestic in late 2015). Some, like Open Road, started in 2011 when a film like The Grey could leg it to $51m domestic and The Nut Job had a shot at $60m. It's not like Open Road's output has decreased in quality. Oh sure, we can make fun of Max Steel, but they've also offered Oliver Stone's SnowdenBefore I FallThe PromiseBleed For This and Sleepless, all of which were (be they good films or bad) star-driven genre fare and prestige projects with notable filmmakers.

And STX popped up on the scene back when a movie like The Gift could leg its way from a $12 million debut to a $43m domestic total on buzz and strong reviews in the tailend of the summer. Two years after A24's Ex Machina legged it to $25m and Weinstein's The Woman in Gold legged it from a $2m debut to a $33m domestic gross, I cannot imagine a similar result in today's marketplace.

In late 2013, CBS Films' Last Vegas legged it to $63 million domestic. Yet now we cheer when CBS's Hell or High Water crosses $26m even with rave reviews and Oscar nods and Warner Bros.' Going in Style may not crack $35m domestic. It's one thing to decry the death of the smaller film from the big studios. It's another to fear for those who specialize in smaller-scale fare when audiences are often avoiding such things, be it because of at-home options or because they are spending their theatrical money on four-quadrant tentpoles (Captain America: Civil WarFantastic Beast and Where to Find ThemThe Martian) that target adults as much as kids.

I hope this can change. And I sincerely hope that STX, Bleecker Street, Broad Green, Open Road and the rest are finding ways to make money from the likes of Captain Fantastic not cracking $6 million or The Bye Bye Man earning $22m domestic. Although I can't imagine the theaters are too thrilled at the moment with said results.

It's one of the reasons I go out of my way to focus on Warner Bros. and Lionsgate, both when they win and when they lose, because they are major studios still putting out a deluge of diverse (in terms of genre and scale) theatrical offerings alongside the would-be biggies over all 12 months of the year.  Because if the newbies don't make it, then it's basically up to the Dream Factory and the House That Jigsaw Built to keep the middle-class movie somewhat alive save for Amazon and Netflix swallowing up everything else outside of the Oscar season.

But rather than argue what the upstarts can do differently, I instead implore you, the reader, to seek out movies like this in a theater. You've probably already seen Fate of the Furious and Kong: Skull Island, so go see The Promise, The Lost City of Z, ColossalTheir Finest or The Circle when they open at a theater near you. Don't wait for Redbox or Netflix. Or, if you honestly can't afford the time (and money) to see an extra movie or two in a given month in theaters, at least buy said movie when it's priced at $15 on early digital HD as opposed to waiting for it to be $5 for rental, $1 at Redbox or nothing on Netflix.

We can argue whether the likes of STX or Open Road are heroes by virtue of keeping such films available in wide theatrical release, but they shouldn't have to be martyrs. The movies are out there, acquired and distributed by relatively new companies that got caught in a sea change that has hurt all non-tentpole movies. Whether or not that will be the case even a year or two from now is entirely up to you.

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