Film sales scene sees light

New buyers in emerging world markets help indies

By PATRICK FRATER

REBEL ROUSERS: In Berlin, Wild Bunch staged an original display for Steven Soderbergh's pair of Che Guevara biopics, two of the few indie titles to make presales recently.

HONG KONG -- Is it possible that increased buying in Cannes by Asian distributors will compensate for the tough conditions affecting the film sales market? Just maybe.

Over the past six months -- from Pusan through the AFM to Berlin -- markets have been buffeted by worries about strikes in Hollywood, the widening of the credit crunch that started with Wall Street's subprime meltdown and a shortage of must-have films.

But sellers headed to Cannes are cheered by the growth in buying power from the world's two biggest developing nations: India and China. Other Asian territories upping the ante are South Korea, Vietnam and Indonesia.

"English-language films in Korea are showing a revival. Russia is still strong, though that's not new. India and China are vibrant new markets, but their MGs are negligible," says sales stalwart Jere Hausfater, who now heads L.A.'s Essential Entertainment. Overall, he says macro and micro conditions are tough.

Although market mavens report that distributors are becoming more cautious and calculating about what they buy, standout pictures with obvious commercial potential can still sell strongly even before a frame is shot. At Berlin in February, white-hot projects included Mandate's Sam Raimi-helmed "Drag Me to Hell," for which only a concept trailer was available, and Wild Bunch's pair of Che Guevara biopics from Steven Soderbergh. At Hong Kong's FilMart in March, a standout was the Pang brothers' "Storm Riders 2," repped by Hong Kong's Universe.

"India has become very aggressive; TV companies are buying foreign-language titles. They are buying sophisticated titles, with many going out on video," says Fortissimo Films co-chief Wouter Barendrecht. "There is a foreign-language revival under way in Korea because their own industry is suffering, while Indonesia now has multiple players, and the Vietnamese market, although very small, is rapidly expanding."

Tanja Meissner of Paris-based Memento Films adds that "India started buying at the end of last year," but she says that doesn't make up for U.S. and Japanese distribs buying less. "Some U.S. companies like Wellspring have closed, others have effectively stopped."

The rise of India is all the more astonishing because the country's theaters are more than 90%-dominated by Hindi-language Bollywood or regional-language fare. And as recently as 18 months ago, scarcely any distributors were buying foreign-language titles.

"The country is changing, everything from our lifestyles to our food habits," says Shantonu Aditya, CEO of UTV Entertainment TV. "Until now, people have seen either Bollywood or Hollywood, but there are over 100 countries that make movies. People are beginning to experiment."

Launched in February, Aditya's UTV World Movies is one of two channels now screening foreign-language indie films, with Sahara's Firangi about to launch. Others joining the fray include 9X Movies, Reliance/Adlabs/Big Entertainment, Zee and Fox.

Aditya says Latin movies resonate with Indian auds. Some 20% of his 450 buys to date are Spanish, Latin or Brazilian. "Ideally we want all rights to a film," says Aditya. "We'll do a deal with a theater chain and a festival, then take it out on homevideo and then play it on the channel."

Still, Firoz Elias, whose Indo-Overseas has been one of the very few Indian distribs in the foreign market for years, warns that the Indian video market for specialty fare has been weakened by deep discounters.

Beyond India, "We are also getting strong interest from China," reports Match Factory sales exec Brigitte Suarez. "Chinese companies are approaching us and they are looking for arthouse, not just commercial, films."

Cologne-based Match has licensed titles such as Aki Kaurismaki's "Lights in the Dusk" and Fatih Akin's "The Edge of Heaven" to Indian distrib Alliance Lumiere, selling all rights on new titles, and TV and video rights on library titles.

European sales companies at the recent FilMart were pleasantly surprised by the levels of buying activity from China for theatrical films, though dealmaking and execution often prove to be different things.

Country has issued distribution licenses to more than 20 companies, but import restrictions mean only 20 (mostly Hollywood) films can enter on "revenue-sharing" terms and another 40 on flat-fee basis.

Gary Hamilton, who heads Oz-based Arclight, says China is an improving market, "but it is all quota-based buying for non-American films. And censorship can have an effect at any stage."