IndieFlix In The Media

SAN FRANCISCO, Dec. 18 - At the Dubai International Film Festival last week, Morgan Freeman, the Oscar-winning actor and star of last year's ''Million Dollar Baby,'' took on his most challenging role yet: movie entrepreneur.

Dubai was one of several stops on a Middle East tour for Mr. Freeman, who was meeting with local moviemakers, hoping to find independent films to distribute through his Internet venture, ClickStar. Mr. Freeman and Intel founded ClickStar this summer with an eye toward offering downloads of a movie at the same time as its theatrical release.

Mr. Freeman said in a phone interview Wednesday from Dubai that the industry practice of showing feature films in theaters first, then selling them later on DVD, was outdated. With new advances in digital filmmaking, he predicted, consumers will demand better access to movies.

''We want to give people what they want, when they want it,'' said Mr. Freeman. ''We are following the wave.''

Mr. Freeman is not the only entrepreneur riding the digital technology surf. In the last several months, a handful of new ventures have been formed to help filmmakers find their audience -- online, on DVD and at the movie theater.

Among them is IndieFlix, based in Seattle, which was introduced by two independent filmmakers in October. For $9.95 a disc, the company will burn a feature or documentary film onto a DVD and ship it to a customer who has ordered it online. Another outfit, 2929 Entertainment, has teamed up with the Oscar-winning director Steven Soderbergh to offer the forthcoming movie ''Bubble'' simultaneously in theaters, on DVD and on cable television.

But how big is the market? Even those working on distributing movies in new ways cannot predict what will capture the public's interest. As many entrepreneurs did in the early days of the 1990's dot-com craze, they are experimenting with untested business models. Hollywood has a long-established way of promoting its movies, mainly through blockbuster releases. Until that changes, entrepreneurs will probably continue to find it challenging to get people to watch their films and to earn enough money to make their ventures profitable.

''The idea that a lot of things can get out without marketing clout is not there,'' said Bob Berney, a Hollywood veteran and president of Picturehouse, a theatrical distribution company. ''I think there are complications for the next several years, as we are still in a theatrically driven mode.''

Still, many in Hollywood smell opportunity, particularly since Steven P. Jobs, the chief executive of Apple and an industry outsider, announced he would offer some television shows and movies on the video iPod. ''I've seen more movement in the last three months than the previous five years,'' said Todd Wagner, who along with his business partner, Mark Cuban, will release Mr. Soderbergh's ''Bubble'' in late January. ''I think people are now saying they can't avoid this.''

Smaller movies with limited appeal could have the most to gain from alternative distribution, either through movie downloads or bypassing studios altogether and selling DVD's directly to consumers. Such opportunities are enhanced in a digital world, which is not defined by international borders or movie-release patterns.

''There is a middle class of movies that have a niche audience,'' said Lori McCreary, Mr. Freeman's business partner. ''If you put those audiences together throughout the world, it becomes a big audience.''

Gian-Carlo Scandiuzzi, a co-founder of IndieFlix, said that 10 years ago, most independent filmmakers sought distribution deals with studios they hoped would market their films smartly. ''That has changed,'' said Mr. Scandiuzzi. ''Film studios are less likely to buy little-known movies, so the film's makers have to ask, 'How can I make money?' ''

Mr. Scandiuzzi and his business partner, Scilla Andreen, started IndieFlix to give directors a place to sell smaller films that major studios would not choose to distribute. Directors submit their films to IndieFlix, which posts descriptions of them on a Web site. When customers pick a movie to buy, IndieFlix burns it onto a DVD and ships it to them. Each film's success depends largely on word of mouth.

Since mid-October, when IndieFlix opened for business, the service has sold about 100 copies of movies a day (about 60 are currently for sale on the site) and the average person buys two or three, Ms. Andreen said. By the end of the year, she said, IndieFlix hopes to offer about 160 films. But success may not be easy to measure: IndieFlix does not track filmmakers' budgets to see if movies make a profit.

''We're something of a petri dish, and want to see what comes of this venture,'' said Ms. Andreen.

Hollywood executives say that movies, particularly independent films, need smart marketing plans to break out of the clutter. At the Sundance Film Festival this year, 2,600 feature films were submitted for review, and only 120 were accepted.

Mr. Berney said that most filmmakers still needed a relationship with a studio to succeed. When he was involved in the release of ''Happiness'' in 1998, he said, ''I did it out of my house with a telephone.'' But he conceded he would not have been able to do so if he had not had longstanding relationships in Hollywood. ''I had a lot of connections to the film business,'' he said.

Peter Broderick, president of Paradigm Consulting, an independent film consultant based in Santa Monica, Calif., advises moviemakers on how to distribute their films in theaters and online. In 2003, he attended the Cannes Film Festival, where he helped sell ''Faster,'' an independent documentary film about motorcycle racing narrated by Ewan McGregor. It had a limited release in theaters.

The makers of ''Faster'' had the right to sell the DVD themselves, and the film got its biggest boost on its Web site, Fastermovie.com. In particular, said Mr. Broderick, ''They had a killer trailer.''

Mr. Broderick said the film sold 5,000 DVD's the first two weeks it was for sale online, and an additional 8,000 DVD's in subsequent months. He estimated that by selling the DVD for about $23, the filmmakers earned about $16 to $18 per disc, compared with the $2 they would have made under a standard studio contract.

Later, when the filmmakers sold the DVD in retail stores, they added a bonus documentary and more footage. And as an incentive for fans who already owned the DVD, they offered a free T-shirt with the purchase of a second. Mr. Broderick said the film sold about 50,000 DVD's in retail stores and an additional 7,000 of the extended version on the Web site.

But most important, filmmakers get the names and e-mail addresses of fans, and can use that information to market their other movies, Mr. Broderick said. ''The filmmakers have a sense of their audience that the studios don't,'' he said.

While most do-it-yourself distributors focus on online marketing or DVD sales, 2929 Entertainment works more broadly. The company has several entities: HDNet Films, which finances smaller-budget movies; Magnolia Pictures, a distributor; Landmark Theaters; and HDNet and HDNet Movies for cable broadcast.

Mr. Wagner, Mr. Cuban and Mr. Soderbergh plan to release ''Bubble'' simultaneously in their theaters, on DVD and on cable television. What the three men are proposing is a radical -- and, to theater owners and existing distributors, not particularly welcome -- model of how movies could be distributed one day. Theater owners complained several months ago when some media executives said the window between a movie's theatrical and DVD release would shrink. And video rental stores, which already fear going out of business if their renting customers become retail buyers, worry about an acceleration of that trend.

None of that is lost on Mr. Wagner, who conceded that a same-day multifaceted release of ''Bubble'' would not be possible if his group did not own both theaters and a cable channel. ''It's not by coincidence,'' said Mr. Wagner. ''I know if I went to another theater and said, 'Let's sell the movie at the same time on DVD and in the theater,' they would say 'no.'

''I don't think there is a right answer yet. We are experimenting. If we are just dead wrong, we are not going to do it anymore.''