Why Is Hollywood Making Such a Strong Push Into the U.K.?

Fighting With Your Family Still - H 2020

Fighting With Your Family

Insiders say a trio of recent deals involving Endeavor, CAA and 30West reveals a strategy by U.S. entertainment giants to get in on the ground floor of a possible British indie boom.

The first few days of the Berlinale saw U.S. entertainment giants make another significant land grab across the globe, this time over the Atlantic.

Before the festival began, Endeavor Content took a strategic stake in The Ink Factory — the production company behind AMC/BBC hit The Night Manager and recent wrestling comedy Fighting With My Family. Day one saw CAA take a minority slice in newly formed Elysian Film Group Distribution, headed up by former StudioCanal U.K. boss Danny Perkins. And just 24 hours later — outside the agency space — 30West took a minority chunk of Altitude Media Group, the Brit banner encompassing sales, distribution and production, led by Will Clarke and behind Asif Kapadia’s recent documentary Diego Maradona.

The British push comes as the U.K. box office is booming — theatrical admissions last year hit a decades-long high — but indies are finding it increasingly difficult to presell films to the U.K., in part because of a dearth of local, non-studio distributors. The trio of new deals represents a vote of confidence in the British market but, some industry players fear, also could signal potentially dangerous ambition on the part of the agencies.

30West’s deal, which follows the company’s acquisition of a majority stake in Parasite distributor Neon back in 2018, can be seen as a reaction to the booming British theatrical market. The market for indie distributors isn’t quite as rosy. The top three studios — Disney, Universal and Warner Bros. — accounted for more than 60 percent of the British box office in 2019. It’s understood that 30West sees its investment in Altitude as a countercyclical move to get in the U.K. market before an indie boom, perhaps with an eye toward repeating the kind of success seen domestically with Neon, which has carved out a strong and growing market for art house and independent films.

But market observers see the trio of Brit deals as further expansion by the agencies and finance groups, which appear to be creating vertically integrated mini-studios, combining talent relationships with international sales and financing arms and, now, even distribution.

Michael Barker, co-president of Sony Pictures Classics, tells The Hollywood Reporter that a move into U.K. distribution makes perfect sense for companies that are packaging and financing indie films but finding it harder to presell them at markets like Berlin’s EFM. "It helps for companies that can get these films made, to have more control of international distribution to get their movies out there," he says.

For international buyers, however, there is a worry that the agencies in particular will be more focused on their commissions than the marketplace. "Generally [the agencies] have used these moves into new areas, like financing and international sales, to get more movies from their own clients made," notes Martin Moszkowicz, chairman of German mini-major Constantin Film. "Which, from our perspective, had not led to better or more commercial films."

Much more annoyed, however, are the indie sales companies, who are dependent on the agencies for talent and packaged films but see them as muscling in on their business. "It’s fucking antitrust," one exec tells THR. "They’ve already cut out the middleman, us, in international sales. Now they are going directly to the consumer with distribution. When are the studios going to realize they’re also cutting them out and put a stop to this?"

This story first appeared in The Hollywood Reporter's Feb. 23 daily issue at the Berlin Film Festival.