Could The Next Hollywood Be New York?

by R.S. Mellette

To work in the film industry, one goes to Hollywood; for publishing, New York. But could that paradigm change in the near future?

Way back in the 1990's, a book was something that came on paper and a movie on film. To buy a book, you went to the bookstore. To see a movie, you went to the theatre or a video store. They were two very different businesses.

Today, both movies and books are digital files. If you want to buy a book, you go to Amazon, iTunes, or Nook. To see a movie you go to ... Amazon, iTunes or Nook.

For computers, the only difference between film and literature is the size of the file. Tour a publishing house or a digital film lab without looking at the computer screens and you'll be hard-pressed to know which was which. They are both transcoding files for different platforms, QCing those files, preparing metadata and art (posters or covers), checking chapter breaks, compressing, and uploading them to the providers.

So, consider ... Motion Picture Studios don't really make movies anymore; haven't for a long time. Sure, they find the projects. They develop the material. They finance the productions, and they distribute them, but the nuts and bolts of turning ink-on-paper into images on the screen is jobbed out to production companies. Imagine makes movies mostly for Universal. Village Road Show for Warner Bros. etc. Of course there is a tight partnership, since the Studios are often putting in most of the money, but even that is beginning to lean more heavily in the direction of the production companies.

Let's say you're a publishing house. The book industry has become so volatile that you need some ballast. You need to leverage the assets you have in a way that can spread the risk. But what assets are those? You have a company full of people who know a good book when they read one, and they are willing to read a ton of them to find the gems. You have a library of good stories, and you're buying new ones all the time. But does that make you a valuable company, or the most insane person in your neighborhood book club?

What's the first thing a movie studio does? They find the projects. You, as a publisher, are sitting on a mountain of them. Not only have you found the diamonds in the rough, you've polished them and presented them to market. You have developed the material.

In your library are Romance Novels that could become a money machine in your own Harlequin YouTube channel. And you're buying new stuff. You just shelled out cash and resources for Mindy McGinnis's Not a Drop to Drink, which is screaming for a wide theatrical release. If you're good, you can lock up the film rights before Hollywood knows what hit them.

In fact, the right of first refusal on the movie is now going to be in your standard contract.

What's the next thing a studio does? They finance. You're a publishing company. You're in New York. You can't swing a big black cat without hitting a handful of hedge fund managers who would love to place a bet on a Big Six project. Where the independent film producer has to beg and explain what they are doing, you can say, "I'm the person who found Hunger Games and Harry Potter. Wanna play with me?"

So, you've got the money. You've got the properties. Now comes the tricky part every homeowner can attest to, finding the right contractor to build on your property. If only there was a high turnover rate in Hollywood. Then there would be plenty of experienced executives looking for the chance to get back into producing. They'd have the connections to put together a string of companies to produce your entire slate.

Oh, wait! There IS a high turnover rate of executives in Hollywood. You can't swing a hedge fund manager without hitting a former studio executive. Or, in my case, a current festival director who gave you this idea in the first place.

So if this is such a brilliant plan, why hasn't anyone done it before?

Not everyone has access to the intellectual property you do, and there's distribution. In the theatrical days, a company had to have a strong relationship with the theatre owners to squeeze their films into the crowded market. That's still true of theatres, but the future is on line. You, as a new studio, are going to have to have a working relationship with the platforms that distribute films, and – bingo! You do.

Amazon, iTunes, Nook, etc. You've been delivering to them for years. You have servers and staff in place to QC, package, and upload to all of these platforms. Once you are delivering films, Netflix, Playstation, Hulu, Vudu, Cinema Now and more will come knocking.

And you're vertically integrated. When people like the book they just read on their iPad; one click and they're watching the movie. What? The movie hasn't been made? They can pre-order it You'll send it directly to their device as soon as it's ready. Talk about crowd funding, a movie could be profitable before it's even shot.

And none of this takes into account the lower budgets on films. The guilds all have "made for New Media" contracts in place with attractive rates. Shooting digitally is a fraction of the cost of the old film days. You could crank out low budget Romance Movies as fast as Cali MacKay can write the books. For the bigger budget theatrical releases, you can partner up with – and learn from – a major studio. In fact, they probably own your company anyway, so the good faith negotiations will be a breeze.

But what about the writers? Will new writers be willing to sell their film rights at the same time they do their book? That's an individual choice, of course, and I hope agents and writers alike will comment here about their thoughts on the subject. Personally, I'd say yes for a few reasons.

First, you're not selling the rights, you're selling the exclusive option to buy the rights within a certain time period. At the end of that time - if they haven't sold it - you get to keep the money you were advanced, and go try to sell the option to someone else. If your agent is good, you might sell a 3 year option from the contract date. It will take two years to get your manuscript to market, and then one year to establish sales. Hollywood will read an unpublished manuscript, but they won't take a lot of interest if it doesn't have sales behind it, so you've been paid for three years of an option, when it's only costing you about six months of post-publising time.

Another reason to sell your film rights to your publisher is that they will be into your project for a lot of money. Turning the red ink on your balance sheet to black is a big motivator in the corporate world. They are going to want your manuscript to be as big of a hit as possible, and that larger investment is going to keep you on their hot sheet.

And finally, it's money! Take it! Sure, most Hollywood movies are based on books these days, but most books don't get made into movies. Yes, there's a chance that they'll hold onto the rights and do nothing, but they paid you. That's better than you and your agent shopping the project around to production companies for nothing. Let your publisher take the project to the same producers with the sales pitch, "and we have the money to produce it." You're in a win-win all the way.

Now, if only I could figure out how to make this a win for me... because, you know, it's all about me.

R.S. Mellette is an experienced screenwriter, actor, director, and novelist. You can find him at the Dances With Films festival blog, and on Twitter, or read him in the Spring Fevers and The Fall: Tales of the Apocalypse anthologies.