Euro Indies Break Theatrical Windows, Launch VOD Strategies Amid Coronavirus Crisis

Jumbo - Sundance - World DRAMA - Publicity - H 2020
Courtesy of Sundance

Art house distributors across Europe are going direct to consumers while still trying to support independent theaters hit hard by cinema closures: “They are just screaming for help.”

Independent distributors across Europe, reeling from the cinema closures and government stay-at-home orders, have begun violating the prime directive of Euro art house cinema: They've broken the theatrical window.

As the continent goes into lockdown amid the coronavirus outbreak, indie distributors in the U.K., Poland, Belgium and Germany and other territories are ignoring traditional release schedules and taking films directly to consumers. As they do so, they are creating new models for independent distribution that could outlast the current crisis.

Several indie distributors in Belgium, including Imagine, Cineart and O'Brother Distribution, joined forces last week to launch VOD Premium, an online offering of art house titles currently in release or about to bow in the territory, which were made available on-demand on the country's leading VOD film sites, including VOD VOO, Proximus, Universcine, Pickx, Dalton and Lumierefilms.

Sundance standout Jumbo — Zoé Wittock's bizarre tale of a misfit girl (Noémie Merlant) who falls in love with a carnival ride — was set for a theatrical bow via O'Brother in Belgium, but instead went up online via VOD Premium.

“I spent €30,000 ($33,000) in marketing for the theatrical release,” O'Brother manager Thomas Verkaeren tells The Hollywood Reporter, explaining his decision to break the theatrical window for Jumbo and go straight to VOD. “If I wait until after the crisis, I won't have another €30,000 to spend. If it continues like this, I'll be completely broke, to be honest.”

Verkaeren adds that he was worried that when theaters do eventually reopen, his small, quirky art house drama would get squeezed out amid the glut of studio tentpoles. As the coronavirus outbreak has spread globally and theaters have shut down in most territories, every big upcoming studio release, from MGM's latest James Bond entry No Time to Die to Disney's Mulan and Black Widow to Universal's Fast 9, has been pushed back until later in the year.

“When things open again, I know my movie won't be priority number one for the theaters — maybe priority five or six, if I'm lucky,” Verkaeren says.

Across Europe, indie distributors are coming to a similar conclusion: shortening or skipping theatrical releases to get their movies to audiences and generate much-needed revenue right now. In Poland, Kino Swiat made The Hater, the new film from Oscar nominee Jan Komasa (Corpus Christi), available on VOD less than two weeks after its theatrical premiere, as cinemas across the country began shutting down. In the U.K., art house distributor Home reached an agreement with streaming service Mubi to bow Andrew Kotting's The Whalebone Box online the day it would have gone theatrical, before Prime Minister Boris Johnson issued a nationwide stay-at-home order. In Germany, Munich-based distributor eksystent Filmverleih did a direct-to-VOD launch for Isadora's Children, a dance drama from French director Damien Manivel. 

It is a radical move for indie distributors in Europe which, historically, have been among the fiercest defenders of theatrical releases. It was French distributors that helped push Cannes to ban Netflix for not holding to France's strict windowing regime, which requires at least three months between a theatrical bow and a VOD release, and 36 months between a film's cinema release and its debut on a subscription streaming platform.

But extreme times seem to call for extreme measures.

European national cinema bodies, which have traditionally defended theatrical windows, are now getting behind VOD models as a means to help struggling producers, distributors and independent cinema owners. Germany's Federal Film Board and France's national cinema center, the CNC, have called for a loosening of theatrical windows in the current crisis. On Friday, the French government passed a temporary measure allowing the CNC to unilaterally shorten the VOD windows for films that were in release as cinemas across the country shut down following the coronavirus outbreak.

This goes directly against recommendations by the European theater association UNIC, which represents the bigger exhibitor chains and which last week warned that allowing movies to break release windows could do long-term damage to the industry. Instead, the UNIC has called on national governments in Europe to step in and support, or bail out, theaters hit by the crisis.

A handful of European companies are finding a way to both take films directly to shelter-at-home audiences and to continue to support local theaters.

On March 18, Draken, Sweden's largest art house movie streaming service, joined forces with indie distributors Nonstop Entertainment, Folkets Bio and Smorgasbord Picture House to offer VOD releases of such current theatrical titles as Céline Sciamma's Portrait of a Lady on Fire and Haifaa al-Mansour's The Perfect Candidate. But Draken also invited independent cinemas in. For the next six months, Draken will split the revenue earned from new subscribers to independent Swedish art house cinemas. Each new subscriber can decide which cinema they want to support.

“We saw our subscriptions jump more than 10 percent the first day [after the initiative],” says Jonas Holmberg, artistic director of the Göteborg Film Festival, which runs Draken. “The revenue from that is enough to pay a month's rent for a small independent theater.”

Draken doesn't stand to make much money out of the deal — "We're splitting the revenue, but we still have all the expenses,” Holmberg admits — but he said as a company run by cinema lovers, it had no choice. “We talked to cinema owners and we saw the crisis they are in — they are just screaming for help.”

Kino-on-Demand, a German VOD service that also specializes in art house titles, launched a similar program, which allows new subscribers to give direct donations to the neighborhood indie theater of their choice. The German VOD release of Isadora's Children is via Kino-on-Demand, with the distributor splitting online revenues with local cinemas.

Mubi, the world's leading art house streaming service, is doing deals with local theaters, including Rio Cinema in London, Cinema Italia in northern Italy and Belrin's Yorck Kinos, to give their members access to Mubi's service.

The demand is clearly there. Mubi CEO Efe Cakarel tells THR that subscriber figures shot up 14 percent last week as more countries went into lockdown. In Italy, which has spent more than a month under shelter-at-home orders, subscriber figures jumped 52 percent.

Phillip Hoffmann, whose Rushlake Media operates Kino-on-Demand, said the platform saw “high double-digit growth” in the first 72 hours after Germany introduced major restrictions on public gatherings.

However long the current shutdown lasts, many in Europe's indie industry believe the coronavirus crisis will prove a watershed moment. The online structures and cross-industry partnerships being formed now — between indie distributors, VOD platforms and art house theaters — could form the basis for new business models.

“I don't think it can continue as before, that when theaters open, suddenly everything will be like it was in 2019,” says Hoffmann. “Hopefully this crisis will force the independent industry to focus on what's really important, on what the industry really needs and what the customers really need. We can have an independent infrastructure that can be both digital and local. The big question is whether we want the revenue for online streaming to go to that great art house cinema in your neighborhood or to some tech giant in Seattle.”