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Video Stars

4 Jan, 2003 By: Dan Bennett

For a while, made-for-video product was available, but it got all the fanfare of a new Tom Jones album. Industry people remembered that direct-to-video enjoyed a sexy history, but what did it have left to give? The video industry had long ago become a hit-driven business.

However, with the success of several direct-to-video animated titles, coupled with the ancillary issue of revenue-sharing, direct-to-video product has been enjoying a minor renaissance since the late 1990s.

Movies made for video, lacking a theatrical release and the attending consumer awareness, remain consistent renters. Though many of the companies that once thrived on direct-to-video product during video's early years are long gone, other independents have taken their place, often producing and acquiring movies in proven niche genres.

“For those who have weathered the storms, now is a good time for companies providing direct-to-video product,” said Darrin Ramage, founder and president of horror-minded Brain Damage Films and the wide-ranging distribution company Maxim Media Marketing.

“Direct-to-video titles, or independent films, go through stages over a period of years,” he said. “You can't forget how important direct-to-video product has been for the industry. Those are the titles that helped companies like Blockbuster Video and Hollywood Entertainment get to where they are.”

Blockbuster even started its own direct-to-video line in 1999, DEJ Productions, while chains such as Best Buy enjoy a steady sales flow on direct-to-video genre product.

“Our best sellers tend to be whatever is newest,” said Best Buy merchandise manager Peggy Munnagle. “Action titles and dramas do far better than specialty titles, however, in terms of total units.”

A live-action direct-to-video title might carry a list price of $40 to $70 and live off rentals. And even though rental profits have fallen since direct-to-video's heyday, production companies are making up for it in strong special effects, good production values and recognizable actors, many either on their way down or on their way up.

There will always be a place for direct-to-video product, because the studios can't supply all that the market demands with theatrical releases, Ramage said.

“As a horror fan, I know that only one or two theatrical horror films a month come from the big studios,” he said. “But we horror fans want to see two or three a week. I love to watch the theatrical horror films, because of the special effects and things like that, but they don't put out enough horror films to fill the void.”

Brain Damage is attempting to fill that void, releasing cult product such as its recent Traces of Death. The company helped finance the film Goth, an in-house production scheduled for June release, followed in July by Hollywood Vampyr, which was a fan favorite at film festivals.

“Whether it be in video stores or on cable, there is always going to be a demand for independent product,” Ramage said. “Much of that demand will be filled by mom-and-pop video stores, which are making a comeback.

“Every label, including Brain Damage, wants as much shelf support as possible from Blockbuster, Hollywood and Movie Gallery. But we're also focusing on mom-and-pops. We would like Maxim to be the distributor of direct-to-video product for mom-and-pops. Maxim will supply product in demand when some of the other distributors have shied away from it.”

While the DVD feeding frenzy has helped raise the bar on all video sales, VHS remains a significant part of the direct-to-video turnaround, Ramage said.

“There is still a large market for VHS,” he said. “You deal with the mom-and-pops in rural towns and some of them have only VHS. We're appealing to those consumers by adding our extras that you would usually see on DVD to the end of the VHS product.”

Buena Vista Home Entertainment, which helped lead the charge in the success of family-themed, direct-to-video sequels to its big animated hits like The Little Mermaid and Tarzan, also scores with live-action video titles. Many are from Miramax Films, which produces direct-to-video sequels to such theatrical hits as The Crow and Children of the Corn.

MTI Home Video started out with direct-to-video product in 1984, producing fitness videos. The company moved away from direct-to-video product for several years, but recently struck a deal with partners Artist View Entertainment and Edgewood Productions to produce four direct-to-video movies. Arachnia is in production, scheduled for second-quarter 2003 release, followed by Avalanche Run and the martial-arts title Blow Back.

“We figured why not get involved from the start?” said Larry Brahms, president of MTI Home Video. “Why not have a voice in the product we are releasing? It also allows us to find out more about foreign sales and distribution opportunities.

“We already know that foreign pre-sale for Arachnia is in excess of the budget. One of the good things about action movies and creature features is you don't need star power. It can be creature as star, or situation as star.”

Brahms agreed that direct-to-video titles fill a gap.

“MTI is very dedicated to revenue-sharing, and there's definitely a rental market for these titles,” he said. “Our revenue studies are showing that the customer is picking these titles off the shelves and renting. Part of it is that technology has come to the point where computer graphics can accomplish special effects affordably. Technology can take part of the credit for this resurgence.”

One of the direct-to-video genres that has stayed strong over the years is urban. Jeff Clanagan, president of UrbanWorks Entertainment, said urban has helped lead the direct-to-video success at retail. UrbanWorks has entered a partnership with Black Entertainment Television to produce original titles for retailers.

“This genre has really exploded,” he said. “The demand has always been there, and now suppliers are feeding that demand.”

Maverick Entertainment is also a longtime producer of direct-to-video titles, until recently with partner York Entertainment. Recent releases from Maverick, which also focuses on the urban genre, include Honeybee, Two Degrees and this month's Go for Broke.

“Our thinking is that it's the right time,” said Maverick president Doug Schwab. “The urban genre is becoming more competitive, so the leaders need to raise the standards as far as scores, soundtracks and stories.

“This is a real opportunity for stores selling both videos and music to cross-promote. Marrying music and movies has become more than a niche market -- it has become mainstream.”

First Look Home Entertainment produces titles in-house for both the theatrical and direct-to-video markets.

“The difference between now and three years ago is we must make titles seem like events to do the best business,” said Bill Bromiley, SVP of sales and distribution for First Look Home Entertainment.

“We have to create a marketing strategy that has the feel of theatrical marketing. We do covers on mailers, spend more money on sellsheets, all the things that make stronger impressions,” he said.

First Look is careful about projects in which it gets involved with production. As the company has long stressed international distribution, titles must appeal to its wide-ranging market. It also maintains a mandate of producing and acquiring critically admired and what might be termed art-house film titles.

“The company is committed to those titles,” Bromiley said. “As long as the rental market is healthy, direct-to-video will stay healthy for us. I don't see that changing in the immediate future.”

Vanguard Cinema acquires foreign-language product seen at international film festivals.

“We're focusing on high production value, good star power and genre movies that capture a mainstream appeal,” said Vanguard Cinema sales manager Alex Xagorakis.

“Many films play and win awards in big film festivals around the world instead of having a theatrical run,” he said. “We acquire films from around the world through our ongoing pipeline of longstanding relationships.

“Only a small percentage of submissions are even considered. We release about six to eight new releases every month, and we don't see a slowdown on acquisitions.”

Finding a place for its direct-to-video titles is the challenge for the company.

“Retail placement is hard to achieve with direct-to-video titles, compared with mainstream theatrical hits,” Xagorakis said.

“Big chains and mass merchants do pick up these releases, but not always. Animal Room always sticks out in my mind. Many big chains acquired this title, and it did well for them.”

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