8297 – Test away, I say!!

New film “Bubble” to test anxious industry
PARK CITY, Utah (Reuters) – If director Steven Soderbergh and others have their way, movies may soon start appearing in homes and stores at the same time they hit theaters, paving the way for a revolution in the industry.
On Friday, Soderbergh and businessman Todd Wagner are releasing “Bubble” as the first movie in a six-part series of low-budget films, all debuting in theaters and on a cable TV network owned by Wagner’s company, as well as on DVD, at the same time and for the same prices consumers would generally pay.
They are not the only ones undertaking such “day-and-date” distribution strategy. Earlier this week at the Sundance Film Festival, IFC Entertainment, a unit of Rainbow Media, unveiled its plan to release 24 low-budget movies in theaters and on pay-per-view TV channels on the same day.
The simultaneous distribution in all three venues presents a direct challenge to the industry standard of releasing films first in theaters, months later on video or DVD, then on TV. Studios have benefited from the traditional practice as they sell the same film again and again at different times of its product life.
Soderbergh, Wagner and IFC want to use new methods of digital distribution to give audiences the movies they want to see, when they want to see them and where they want to see them.
“The technology is there,” Soderbergh told Reuters. “Consumers now want choice, and they should have it. At the very least, let’s find out — instead of speculating — what it’s going to mean in the long run and in the larger picture.”
But theater owners argue such distribution plans could signal the end of a more than 100-year-old industry by cannibalizing box office ticket sales that now reach around $24 billion annually around the world.
“We believe simultaneous release is a death threat for the movie industry,” said John Fithian, president of the National Association of Theater Owners.
Hollywood studios are closely watching the “Bubble” release, which they see as something of a test, albeit a small one because the film is a low-budget production made for a reported $1.6 million.
The studios know change is coming because new digital technology is allowing consumers to download movies and TV shows directly to home PCs, laptop computers and handheld gadgets such as Apple Computer Inc.’s iPod.
They are concerned that illegal copying and downloading of films will become widely popular and hurt ticket sales in the same way piracy damaged the music industry’s CD sales.
Moreover, this past summer, the studios suffered through a box office slump that many attributed in part to audiences simply skipping the films and waiting for the DVD. To compensate, the studios now are narrowing the time between a film’s theatrical and DVD releases.
But just like theater owners, studio executives are loath to see the “day-and-date” distribution strategy take hold because it might cannibalize ticket sales. Video retailers are subject to the release patterns set by movie studios and, as a result, have less say in the matter.
This past summer, Walt Disney Co. Chief Executive Bob Iger told analysts and reporters that digital technology was moving the industry toward simultaneous releases.
The company pressed the issue last fall, when its ABC television network began offering TV shows for download on the iPod. Other networks followed, but NATO’s Fithian said Hollywood’s major film studios remain hesitant.
Many industry watchers see a somewhat limited impact from the “Bubble” release because the film is low-budget and will play mainly in Wagner’s Landmark art-house theaters and only on his HDNet cable TV network, rather than on a broadcast network.
The film weaves a tale of small-town boredom and jealousy. Soderbergh used people from local Ohio towns to act the four major roles, and he shot it with digital cameras.
“It added realism,” Soderbergh said. “Every once in a while, it’s nice to see somebody on screen who you felt was from that place and spoke like somebody from that place.”
Still, “Bubble” has kicked up a fuss in Hollywood because Soderbergh is the director of such big-budget films as “Ocean’s Eleven,” and the idea of day-and-date releases of $200 million blockbusters like “King Kong” or “Harry Potter” is what really worries Hollywood and theater owners.
In fact, at this early stage, many industry watchers believe the real impact of day-and-date distribution will be for low-budget independent films and filmmakers like those gathered in Park City for the Sundance Film Festival.
Such movies generally only play in large cities and in fewer than 100 screens. A big-budget Hollywood flick like “Kong” reaches more than 3,000 theaters.
Day-and-date distribution takes advantage of the national advertising campaigns for a low-budget movie by putting the film not only in big cities, but also in rural areas on TV or PC.
Rainbow Chief Executive Joshua Sapan likens the idea to an art house in the home. “It will have the effect of enlarging the audience for independent films when they debut,” he said.
But Wagner sees a broader future when theater owners around the world embrace the idea. To offset the possibility of cannibalizing ticket sales, he said he would share DVD revenue with them.
“Not all theater owners are saying no,” Wagner said. “In fact, a lot of them are saying yes.”
But Fithian warns of a time when movies are no longer special events for audiences, and become more like TV shows that can be seen anytime, anywhere.