The Future of Theatrical Distribution: Or How Paranormal Activity Is Like Chocodiles

Call this a broad overgeneralization, but Paranormal Activity is a defining moment in the history of theatrical film distribution.

Yes, it’s a gimmick.  Paramount very wisely picked this film up at Slamdance and very wisely changed their minds about re-shooting it with a big name cast and a bigger budget.  Paramount very wisely deployed a demand a screening in your hometown online campaign, showing the film in one-off midnight or one weekend only screenings in several cities and then watched that number of cities grow as the film became a trending topic on Twitter.  And, yes, social media was, until the papers picked up the story, the most likely way to hear about the movie. And now they claim that if the film gets a million “demands” it will be released nationwide (they’re about 100,000 shy of that number as I write this).

But the gimmicky aspect of it (or, at least, our innate suspicions every time a major corporation benefits from social media) is really not the point.

I used to think that the future of film distribution would be split into two tiers of release.  Blockbusters – sure-fire, expensive, big investment, big return flicks, your Spider-Man 7‘s – would be the only films guaranteed a theatrical release.  Probably in 3-D.  Anything that cost less than $100 million to make would never see the inside of a movie theater.  Straight-to-DVD or, more likely, iTunes, XBox, and Netflix streaming.

In fact, almost nothing would cost around $100 million.  Most movies would cost way north of that while the rest would probably never go over the golden $20 million mark the Indie Spirit Awards love so much.  That’s because the potential revenue stream from home video would rarely justify that kind of expense.  Bascially, you’d be talking about the end of the “middle class” of pictures (which is already happening).

But now there’s this weird third tier that becomes a possibility, and I’m kind of surprised I didn’t think of it sooner.

What Paramount is facilitating (disingenuously or not, you can decide for yourself if they planned on releasing it nationwide all along or if they really are performing some grand social media experiment) is the idea of customized theatrical release.  Not customized to the filmmaker, which, in a way, is what self-distribution ends up being (you release where and how you can afford).  But customized to the audience.  If only Philadelphia, Tampa, and Phoenix want the movie, only Philadelphia, Tampa, and Phoenix get the movie. And if demand for the film reaches some sort of critical mass, then it gets to play alongside Spider-Man 7 in every theater.

From an economic standpoint this makes perfect sense, provided you tweak the model a bit.  If you can establish enough demand in a given city for a product to pay for the distribution and marketing of that product (only in that city, mind you, which is far cheaper than paying for national advertising) then you can justify showing the film theatrically in that town.  It’s kind of like how chocodiles are only available on the West Coast.

An even safer bet for studios (and let’s not forget for one second that it’s a major studio pulling this stunt, not some small indie like the outfit that released Blair Witch – and let the comparisons end there, thank you very much) would be to get a pledge from consumers to buy a ticket.  A presale.  If the presales don’t meet the magic number for a release in that town, audience members either get their money back, or get an advance copy of the DVD.  And a chocodile.  Those things are delicious.

Is this actually how the future of distribution will pan out?  Probably not.  I’m sure there’s a dozen holes in my theory that I haven’t fully thought through (like is this model even remotely going to pay for the theaters themselves to stay in business).  But does it make a lot of sense right now?  To me, absolutely.  The future of the market of just about anything, especially anything that qualifies as “content”, is on demand.  With virtually every other distribution channel catering to only giving the product to those who want it instead of sending it to everyone and waiting to see who actually takes it, it makes sense that theatrical distribution would find a way to fit the new mold.

As further evidence of my theory, look at the fact that the channel Paramount is using to book these screenings is a Web service that already exists to book music acts in towns based on the same principle.  If enough people ask for it, the town gets the show.

Part of this is simply the technology enabling a process that would have been nightmarishly complicated before.  Before the Web, how exactly were you going to figure out in a reasonable amount of time exactly how many people in every state in the union wanted to see your movie?  Now, it’s easy.

What really excites me about the prospect of this becoming standard operating procedure is the idea that it completely upends the opening-weekend-dependent model that has dominated the past thirty years or so of theatrical release.  This new model would get us back to the old days of the movie gets time to build an audience on its own merits instead of having to justify sticking around in theaters by hitting a home run on its first at bat.  This is a quality issue as well, because usually the only way to hit that home run is to appeal to the lowest common denominator.  That’s not always a bad thing – I love me some common denominator from time to time – but it doesn’t make for a lot of variety of expression.

The other thing that excites me about this is the idea that the theatrical experience gets a chance to stand or fall on its own merits.  Now, if people really want to see a move in the theater, they can vote on it.  And if it turns out the age of the movie theater really is gone and nobody except me and five other dorks want to see movies on the big screen with strangers then that will be the reason they go away, and not because it became too expensive to gamble on whether or not enough people would go see your film.