The pre-sale market has dried up and is never coming back, financiers at this year’s Cannes tell me. That, combined with fewer banks lending to producers, means equity investment is more important than ever. Even those private lenders still left in the game, say they want to fully finance their own movies with equity.
The trend at this year’s market has been for sales agents to make one or two key pre-sales, encouraging financiers in. But distributors have been folding their arms, waiting for completed product. Buyers used to jump in throughout a movie’s production, locking distribution rights for themselves. No more.
“We’ve converted into a completed film market, unless it’s a bigger project being sold by a handful of sales companies,” one financier tells me. “It’s changed forever and I don’t think it’s ever coming back.”
Financiers say they are now only interested in genre films. After all, if distributors are not prepared to take a risk, then why should they?
Not that there was much to pre-buy anyway. Distributors have complained about the lack of attractive projects at this year’s market. Inferno generated heat on its Brad Pitt adventure The Lost City of Z, while Summit’s The Three Musketeers 3D sold well. IM Global sold out on its Jason Statham thriller – Statham being the nearest the indie market has to a sure thing.
As for all those hot projects being talked up before the market, there’s been silence. Nothing about Tony Scott’s Potsdamer Platz, starring Javier Bardem, Mickey Rourke and Statham again; nor about McG’s adaption of Broadway musical Spring Awakening; no sales news about Nu Image’s Kane and Lynch, starring Bruce Willis and Jamie Foxx. Of course, announcements may still be coming once everybody’s back at their desks.
There wasn’t much interest in finished projects either. Normally, there are three or four completed films that get buyers salivating. Not this Cannes. Sony Pictures Classics has been the only studio to flash its cash so far, buying domestic rights to three titles: Another Year, Of Gods and Men and In a Better World. Relativity Media bought US sci-fi movie Skyline. And IFC acquired US rights to Xavier Dolan’s Un Certain Regard entry Heartbeats. And that – for the most part – has been it.
Not that you’d know that from the daily trades here, which talked about “a roaring trade”. Sales agents spoke about the market stabilising with lots of buying going on. Well, they would wouldn’t they?
Didier Duverger, co-chairman and managing director of French bank Coficine, tells me: “The international market hasn’t been very good. The future’s doesn’t look much brighter, and that’s not going to change.”
Of course, it may be that those sales agents who blame the pre-sale market drying up aren’t very good at their job. Heather Mansfield of Mansfield Associates – who represents Hong Kong’s Standard Chartered Bank in Europe – tells me sales agents she was policing have made lots of sales “because they had movies that people want”. That said distributors have been negotiating hard to get prices down.
Other lenders I spoke to – who went around the market checking on what sales agents have been doing – were more downbeat. Duverger says: “I’m really scared the market is going to stay this way for another two or three years. It’s not a nice feeling.”