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Indie family films make inroads in Hollywood

With animated features such as Shrek 2 and The Incredibles continuing to rake in serious cash at the box office, big Hollywood studios are getting more aggressive in their hunt for their next winner and increasingly mining the vein of indie content for toon gold. In the last two years, Warner Bros. and Universal, for example, have set up distribution arms for the sole purpose of finding and signing up independently produced family-friendly films. Moreover, with the recent proliferation of portable media devices, alternative financing channels opening up and production costs coming down, it's getting easier for smaller prodcos to feed this emerging pipeline.
January 1, 2006

With animated features such as Shrek 2 and The Incredibles continuing to rake in serious cash at the box office, big Hollywood studios are getting more aggressive in their hunt for their next winner and increasingly mining the vein of indie content for toon gold. In the last two years, Warner Bros. and Universal, for example, have set up distribution arms for the sole purpose of finding and signing up independently produced family-friendly films. Moreover, with the recent proliferation of portable media devices, alternative financing channels opening up and production costs coming down, it’s getting easier for smaller prodcos to feed this emerging pipeline.

New content delivery devices such as mobile phones and portable media/DVD players are quickly finding their way into kids hands, meaning the demand for appropriate film fare and opportunities for smaller producers will only increase. ‘Lately it seems like every other minivan on the road has a DVD screen in it playing family content,’ says John Eraklis, president of L.A.-based Exodus Films. His company hopes to entertain kids during long drives with four new animated offerings being completed between now and 2008, including Igor in 2007.

Meanwhile, thanks in no small part to the potential promise of rich ancillary revenue streams, both venture capital firms and investment funds are looking to kick some money into the production of kids fare for the first time. CEO and co-founder of L.A.-based The Hatchery Margaret Loesch adds indies are learning more creative ways to put together funding, such as financing a slate rather than a single film to better amortize costs and risk – a strategy she’s pursuing for upcoming films The Great Brain and The Freak. Many U.S. states are also increasing tax breaks and incentives as a way of drawing in the film industry.

And dropping technology costs are making budgets a lot less daunting for indie producers. Loesch estimates that shooting a live actioner in digital rather than on film can cut costs by as much as 10%, which meant more than a US$400,000 saving for The Hatchery’s 2004 release Benji: Off the Leash.

In animation, the difference is even more pronounced. Five years ago, Eraklis says an animator’s workstation cost more than US$250,000, but with today’s off-the-shelf software and tech, a toonstation sports a modest US$10,000 to US$15,000 price tag. He cites Vanguard Animation’s 2005 release Valiant as a successful example of creating on a shoestring. It’s been widely reported that the 70-minute CGI feature’s production budget came in at under US$40 million – a fraction of the cost of big studio CGI features such as Shrek (also produced by John Williams), but the film managed to pull in more than US$50 million worldwide.

Finally, attracting the all-important big name talent that brings the crowds into the multiplex and can make or break a distribution deal is also less of a struggle. Eager to do animated films, celebs are sending their agents to smaller production houses to scout for roles. For example, Exodus’s initial Igor short featured Christian Slater and John Cleese. Eraklis says revenue-sharing opps and a flexible working environment are also big draws for stars currently hooking up with smaller prodcos.

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