Not that long ago, premiering a star-driven Sundance Film Festival movie on a video-on-demand channel was an admission of failure.
But last year's festival produced two huge on-demand hits, Richard Gere's crime drama "Arbitrage" and Kirsten Dunst's wedding comedy "Bachelorette," which collectively generated nearly $30 million in revenue, mostly from VOD.
With the nation's most prominent film festival kicking off Thursday in Park City, Utah, can history repeat itself?
"The last year has educated people that they can have a hit using alternative distribution platforms," said Tom Quinn, the president of the Weinstein Co.'s Radius label, which released "Bachelorette." "This Sundance we'll see how much everyone has learned."
After years of hype in the independent film business, digital platforms have finally begun to bear fruit. Last year's Sundance didn't yield the mega-deals that over the last decade have seen studios pay as much as $10 million to release low-budget productions such as "Hamlet 2" in theaters.
But thanks to VOD, movies that were bought at Sundance last year for only about $2 million, including "Arbitrage" and "Bachelorette," were breakouts. "Arbitrage," purchased by Lionsgate and Roadside Attractions, has grossed $8 million at the box office but nearly $12 million on VOD; "Bachelorette" has tallied less than $1 million at the box office but $7.3 million on VOD, according to their distributors.
Several movies from Sundance 2012 did perfectly well following more traditional release plans centered on opening in movie theaters, bolstered by strong reviews: the Oscar-nominated "Beasts of the Southern Wild" and "Searching for Sugar Man."
Each year, scores of independent filmmakers come to the snowy Utah town looking for deals that will bring their movies to audiences. Over the course of the festival's 10-day run, sales agents will huddle in condos and movie theater lobbies, haggling not only over how much the films will sell for but also where they will be shown. Finding the next "Arbitrage" will be on the minds of many buyers this year.
Among the contenders are Richard Linklater's "Before Midnight," the director's final installment in a romantic trilogy starring Ethan Hawke and Julie Delpy; the porn-addiction comedy "Don Jon's Addiction," directed by and starring Joseph Gordon-Levitt; the Shia LaBeouf-starring romantic thriller "The Necessary Death of Charlie Countryman"; "Kill Your Darlings," which offers the prospect of watching Daniel Radcliffe as a young Allen Ginsberg; and "Lovelace," the story of the '70s porn legend as played by Amanda Seyfried.
Experts say celebrity is a key factor in an on-demand hit; it's nearly impossible to attract channel-surfers without a known name.
"The VOD model doesn't work without a good cast — home entertainment is just different that way," said Howard Cohen of Roadside Attractions. "'Beasts of the Southern Wild' would never do 'Arbitrage' numbers on VOD — no way. And you have to have talent that are willing to support a VOD release and do publicity."
But filmmakers also say they believe their star-driven offerings will resonate with buyers because they tackle universal issues.
"Linda [Lovelace] embodied the evolution of the culture because she was very much about the loosening of sexual mores," said Jeffrey Friedman, who co-directed the film. "She's also a great character study — she's the girl next door who ended up in a very dramatic situation."
Challenges remain with VOD. Many filmmakers want a commitment that their movies will play in theaters before VOD, as well as a large upfront cash payment, known as a minimum guarantee. And actors aren't always on board for a release that will play out largely on television sets, though some are coming around.
"I think the discussion with talent is a lot easier now," said Jessica Lacy, head of the independent film division at ICM Partners, which is selling titles such as the relationship drama "A Teacher" from the young director Hanna Fidell. "But it's still a discussion."
Although there are often willing buyers for sexy films with a big star, filmmakers also hope they can sell difficult but highly original work.
Last year saw the debut of "Searching for Sugar Man," the story of a mysterious Detroit musician by unknown Swedish director Malik Bendjelloul. The film, bought by Sony Pictures Classics, has joined "Exit Through the Gift Shop" and "Capturing the Friedmans" on a list of all-time Sundance documentary breakouts and has been nominated for an Oscar.
Sundance 2012 also famously yielded "Beasts of the Southern Wild," a magical-realist drama from first-time feature filmmaker Benh Zeitlin that Fox Searchlight purchased; it has taken in $11 million at the box office and landed Oscar nominations in the best picture, director, actress and screenplay categories. Searchlight executives have signed up to make Zeitlin's next film.