Indie Execs Say Content Is No Longer King — Data Is

Business models on which the industry has relied for decades are breaking apart as studio blockbusters grab an increasingly large share of the domestic box office and streaming platforms splinter the audience for niche and indie fare.

The fast-changing world of independent film distribution can be a scary place. Business models on which the industry has relied for decades are breaking apart as studio blockbusters grab an increasingly large share of the domestic box office and streaming platforms splinter the audience for niche and indie fare.

"I am frankly terrified of what is going on in the marketplace right now," said Christian Parkes, chief marketing officer at Neon, the specialist distributor that has enjoyed success with impossible-to-categorize films like I, Tonya ($30 million domestic gross) and Bong Joon Ho's Parasite ($7.5 million domestically so far on the way to, Parkes estimates, $10 million-plus).

Still, Parkes said Friday during an AFM financing conference that he is "freaking out" over the changes wrought by digital disruption, the increasing competition for viewer eyeballs and the "churn" of films that, if they don't find an audience immediately, are quickly dropped for the next thing.

"You release a film on Friday and if the audience hates it, it's dead by Sunday, it's insane," Parkes said. "If your content is not special, good luck."

"It's, 'Be amazing,' which is an interesting business model," added Erik Feig, the former Summit and Lionsgate exec whose newly founded production shingle, Picturestart, has several features in the works, including Paramount's Grease: Summer Nights and Unpregnant, an "abortion road movie comedy" that will be the first original to stream on WarnerMedia's HBO Max service.

In this brave new world, Feig notes, the key is to target the niche audience. "You find a group of people who are passionate about something — and you start with them," he said. "You make a movie that will satisfy that niche audience and then you extrapolate beyond that, turn that audience into the proselytizers for your film."

And the key to identifying those niche audiences is data. Aron Levitz, head of Wattpad Studios, the production arm of the writers' social networking site, says his company uses data "to find the stories" its users want and continues to crunch the numbers as they develop those stories into films. Wattpad had a hit out of the gate with its teen romance drama After, which was adapted from an original Wattpad story and has grossed some $70 million worldwide.

Parkes agreed that in today’s marketplace, audience data is crucial. "Is content still king? I'd say data is king," he said. "If you aren't relying heavily on it, you are going to lose."

But despite the doom and gloom surrounding much of the indie industry, Tim League, founder and CEO of Alamo Drafthouse Cinemas, said he remains optimistic, even when it comes to the traditional theatrical business.

"Parasite, as a foreign-language film, is going to gross $10 million, [and] we had four documentaries last year that grossed more than $10 million," he noted. "That has never happened before. We are fine."

A version of this story first appeared in The Hollywood Reporter's Nov. 9 daily issue at the American Film Market.