Film Distribution and Exhibition: A Comprehensive Overview
Film Distribution and Exhibition
Legal and Structural Classification of Theaters
Rooms can be classified according to two criteria:
- Legal Criteria: Theaters are classified as either standard theaters or halls x, which are permitted to project X-rated movies subject to special advertising classification and higher VAT.
- Structural Criteria: This classification depends on capacity and screen availability, encompassing the following categories:
Theater Types
- Parker: Large-capacity, single-screen theaters located in major urban centers. This model is nearing extinction due to competition from multiplexes, primarily showing blockbuster films.
- Multisalas: These complexes emerged in Spain during the 1980s due to declining viewership and competition from video and television. They feature more than two screens with varying capacities, accommodating films with diverse levels of popularity.
- Multiplexes and Megaplexes: Multiplexes have six or more screens and at least 2,000 seats, while megaplexes boast 15 or more screens and 4,000+ seats. Expanding rapidly between 1998 and 2002, these complexes adapt to demand by offering multiple showtimes of the same film, amplifying the success of popular movies. They also cater to diverse content, sometimes including arthouse films. Located near shopping centers in major cities, they offer high-quality architecture, sound, and image, but with higher ticket prices often offset by loyalty card discounts. The sale of related products contributes to recouping the high investment costs. While initially boosting viewership, the rise of megaplexes has destabilized nearby theaters, leading to closures—a phenomenon known as the scorched earth effect.
Distribution and Exhibition Agreements
Distributor-Exhibitor List
Film producers can assign distribution rights through two systems:
- Flat Rate: A fixed amount independent of box office revenue.
- Percentage: A share of the revenue based on ticket sales. This is the most common method, with two variations:
- Fixed Percentage: A consistent percentage (typically 40-60 or 50-50) throughout the exhibition period. Spanish distributors typically receive around 52%, while other European distributors receive around 42%.
- Percentage Scale: The percentage varies over a minimum number of exhibition weeks, adjusting based on performance. For example, it might start at 50-50, then shift to 55-45, and finally 60-40.
Exhibition Contract
Exhibition contracts are standardized, including details like distributor and exhibitor names, cinema name, approximate programming date (often based on previous film performance), film format, identification data, and percentage sharing.
Promotional Activities: Marketing
Marketing plays a crucial role in the audiovisual sector. It encompasses market research, distribution channel analysis, and the development of effective sales strategies. Its objectives include sales forecasting, promotion, market research, distribution optimization, campaign orientation, and product adaptation.
In the audiovisual sector, marketing is employed throughout the three phases of production:
- Development/Financing: Securing funding from investors. Producers use tools like a business plan (including an introduction, industry analysis, synopsis, market analysis, creative and business elements, schedule, financing plan, and revenue forecast) to attract investment. The financing plan typically aims for 30% equity, 30% loans, and 40% from advance sales and ancillary rights. Revenue estimates are based on projections from agents and distributors.
- Production (Filming): Marketing efforts continue during filming to secure further investment and pre-sell distribution rights.
- Distribution: This stage focuses on commercial promotion to maximize audience reach.