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Cannes film market proves buoyant for industry

May 23, 2006

By Bob Tourtellotte

CANNES, France (Reuters) – While stars like Tom Hanks and
Penelope Cruz grabbed the limelight on the red carpet at the
Cannes film festival this week, deal-making for global movie
rights proved fast and furious, industry players said.

To the general public, images of the A-listers as they are
dazzled by walls of paparazzi and TV crews are what the world’s
biggest film shindig is best known for.

Behind closed doors, or over a bottle of champagne aboard a
luxury yacht, the money does the talking, although more than
ever this year players are having to grapple with technological
changes on the Internet and devices like the iPod.

Even though worldwide box offices suffered slightly in
2005, the industry is enjoying a healthy appetite for films in
numerous arenas, including DVD, executives said.

Moreover, the market movers in Cannes continue to sound
upbeat over new arenas for growth including Internet downloads
and mobile phones.

“Our screenings have been almost full on every single one
and our meetings literally have been from 8 in the morning to 7
or 8 in the evening, every day,” said Jonathan Deckter,
president of Australia’s Arclight Films.

This year’s Marche du Film saw pre-exhibit attendance rise
eight percent from last year to more than 8,600 participants,
and festival organizers expect that number could hit 10,000
after latecomers are tallied.

More than 4,400 movies will screen in Cannes as part of the
market.

Most of those films, like “Mission: Sex Control,” horror
flick “Dead Men Walking” or Vietnamese drama “Pao’s Story” may
never play at moviegoers’ local cinemas.

More likely, they will show up on DVD, video or television,
which are key outlets for most market films screening here.

PRICES RISE

Several executives said this year’s strong demand helped
push prices higher, but both buyers and sellers point out that
licensing rights vary widely depending on film genre, quality,
stars and countries involved.

Generally, a movie produced for $6 million to $12 million
might fetch $400,000 to $850,000 for all rights in France,
whereas in Chile, the same film may get between $40,000 and
$60,000, according to published reports ahead of the show.

While most executives agreed that this year’s Marche du
Film was a seller’s market, they all said they would not know
how the final numbers added up until after the market ends on
May 28.

One area puzzling many film buyers and sellers is how much
to pay and charge for rights to download movies on the Internet
and show video on wireless phones and handheld devices like
Apple Computer Inc.’s video iPod.

“Wireless is clearly this season’s issue,” said Jean
Prewitt, who heads up the U.S.-based Independent Film and
Television Alliance which represents independent producers and
sponsors the American Film Market each fall in Los Angeles.

Because those rights and contract details remain “fuzzy” in
the eyes of executives, the IFTA has issued a guide to wireless
distribution contracts that it offers to producers and
distributors around the world.

Another development in recent years that is fast becoming
more prominent is the influx of money from private equity funds
to produce movies made outside Hollywood.

For investors with an appetite for risk, independent films
can reap huge returns. A movie like last year’s gay cowboy
romance “Brokeback Mountain” cost about $14 million to make but
earned roughly $178 million at worldwide box offices.

Earlier this week British outfit Brass Hat Films secured a
$200 million equity fund from an undisclosed financier in the
Middle East.


Source: reuters



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