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Cannes was quiet this week. Although the stars and the paparazzi went through the usual red-carpet routine, there was less extravagance and a smaller contingent of film-buyers than usual. Yet for makers of independent films, that was not the end of the world. In their business the action increasingly takes place not on the French Riviera but in American living rooms. Tricky, intelligent films are finding a home in the least glamorous corner of the television business.
Getting independent films into cinemas, never easy, has become much harder in the past year. Some specialist distributors, such as Warner Independent Pictures, have closed and others are buying fewer films. The credit crunch and the strong dollar have cut foreign sales. Meanwhile cheap digital-video cameras and editing software have produced a flood of content. Some 5,500 films are chasing buyers in Cannes this year. Last year just 606 new films were released in American cinemas. Many lost money. "The economics just do not make sense," says Jonathan Sehring of IFC Films, an independent distributor.
Hence the rapid growth of an alternative. This year IFC will release about 100 films "on demand", meaning they can be called up for a fee in most households that get their television via cable or satellite. Many will be available on the same day that they first appear at film festivals such as Sundance and South by Southwest. Later this year IFC plans to launch a new on-demand channel to showcase documentary films. Cinetic, a powerful independent-film broker, will also get into the game this summer.
The reason for the rush is that, for low-budget films, the economics of video on demand do make sense. Cable companies, which take a cut when they sell a film, help with advertising. Mr Sehring says IFC makes about as much when a film is sold on demand as when a customer buys a cinema ticket, even though the ticket costs almost twice as much. He reckons he recoups his costs and returns money to filmmakers more than half the time—not bad for films that might otherwise have disappeared without trace.
Distributors are learning what kinds of films are best suited to video on demand. Whether accessed via cable television or the Internet, video on demand is likely to grow. America"s suburbs are becoming much more diverse places, with more ethnic minorities, more people with degrees and more gays, according to Gary Gates, a demographer at the University of California, Los Angeles. The potential audience for independent films is thus dispersing beyond the places where independent cinemas are concentrated. Not everybody lives near an art-house cinema, but almost everybody has a remote control.