After last year’s acquisitions lull at Sundance, especially by Netflix and Amazon, this year’s festival produced a number of megadeals.
Buyers spent over $120 million acquiring rights to some 40 films. However, the big news came from Amazon, which spent $46M on five films.
Streamers Domination
The independent film market is swiftly shifting whereby newer buyers are winning out in bidding wars against more established distributors.
Legacy buyers are being forced on the sidelines by the economic realities of the independent film market, which doesn’t apply to Netflix and Amazon. These streamers could acquire the top ten films at every major market, and the costs would barely be noticeable on their balance sheets, this is doubly true for Amazon.
Initially, there was speculation that Amazon would forego Sundance this year – nothing could have been further from the truth.
Amazon’s $46 million buying spree is four times what traditional powerhouses like Fox Searchlight typically spend at Sundance. Amazon’s $13 million acquisition for the comedy Late Night was largest U.S. distribution deal in Sundance history.
At Sundance last year, Amazon made no acquisitions of note after eight-figure deals in the previous two years. In 2016 Amazon purchased Manchester by the Sea for $10 million and The Big Sick in 2017 for $12.5 million.
Fox Searchlight, and to a lesser extent Netflix, were mostly muted at this year’s festival after leading the charge in years past.
Netflix picked the true crime series Delhi Crime, which is scheduled to premiere on March 22. The seven-part police procedural drama is based on the gang rape of a young Indian woman in New Delhi.
Netflix has pinned great hopes on growing its service in India after the company’s efforts to launch in China were thwarted by the government.
However, it’s hard to imagine that censors in India will allow this series to stream in the country given its subject matter. Netflix recently capitulated to censors in Saudi Arabia on Hasan Minhaj’s Patriot Act.
Notable Sundance Deals
Documentaries Win Out
Netflix couldn’t resist the opportunity to outbid all other buyers in the competitive auction for the political documentary Knock Down the House, which ended in a $10 million deal.
The film that follows several candidates on the 2018 campaign trail was the costliest documentary acquisition at Sundance. The prior record was reached when Netflix bought the Russian doping documentary Icarus in 2017 for $5 million. Icarus went on to win the Best Documentary Oscar in 2018.
Documentaries coming out of Sundance have been performing extremely well at the box office.
The Mister Rogers documentary Won’t You Be My Neighbor?, grossed over $22 million for Focus Features; RBG, the documentary about Supreme Court Justice Ruth Bader Ginsburg, grossed $14 million for Magnolia Pictures; and Three Identical Strangers, acquired by NEON and CNN, grossed $12 million.
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FilmTake Away
The films acquired by Amazon don’t have to be profitable in any sense of the word. The company’s film and television business can be loss leader for the rest of Amazon. Given the massive revenue generated by Amazon, any filmed entertainment losses have almost no impact on the business at large.
The unprofitability-by-design model employed by Amazon and Netflix is wreaking havoc on traditional independent distributors. The upshot to this pricing pressure is that buyers are willing to take greater risks on lower-budget films, which will hopefully bolster new cinematic voices.