Hollywood's in trouble. That seems to be the consensus of filmmakers and filmgoers at the Tribeca Film Festival.
"The economic model of the film business is broken," said Oscar-winning director Steven Soderbergh during a panel discussion Monday night entitled "Downloading at a Theater Near You."
Soderbergh cited a litany of Hollywood problems: the obscene compensation of A-list talent (top stars routinely receive packages worth $25 million) and a revenue-sharing system that he described as unfair to theaters.
But Soderbergh also expressed hope that digital formats and innovative release strategies will soon revolutionize the way we watch movies, whether Hollywood likes it or not.
He and another panelist, movie mogul Todd Wagner, proposed several cures: a salary cap for actors, a closing of the "windows" between when a film plays in theaters and when it is released on other platforms, simplification of budgets and contracts, increased incentives for movie theater owners and a cessation of pre-film on-screen advertising.
Everyone had stats to quote. Soderbergh cited the 85 percent increase in "negative cost" -- the expense of shooting and editing a film -- and a 110 percent jump in advertising and creation of 35-mm prints, all in a decade.
Panelist and BitTorrent co-founder Ashwin Navin said 700,000 films are downloaded using BitTorrent each day. And Wagner, who with Mark Cuban runs 2929 Entertainment, said movie tickets represent only 13 percent of a Hollywood studio's revenue, the rest coming from DVD, merchandise and other streams.
"That 13 percent tail is wagging the rest of the dog about how (studios) are releasing films," he said, adding that "the vast majority of the people are going to see your movie in some other medium."
"We learned this from the music industry -- you've got to give the people what they want or they'll figure out how to get from other means," Wagner said. "People like Steve Jobs (now the largest shareholder at Disney) will turn one revenue stream into three revenue streams. We need to rethink and get creative about how to exploit revenue streams in the digital (filmmaking) world."
Salary caps and instant showing across multiple media? What is this, the NFL? Well, I'd rather stay home and watch than shell out the mega-bucks it takes to go to either event. Unless something radical and inventive comes along, the day of taking the family to the theater has passed IMHO.