With this year’s Sundance Film Festival kicking off in Park City, Utah, on Thursday, film buyers will be on the lookout for the next big indie sensation.
But if last year’s box office results are any indication, a Sundance hit doesn’t necessarily translate into a box office hit.
At Sundance 2019, buyers—in particular, Amazon Studios—shelled out big bucks for movies that seemed to have broader box office potential.
For the most part, that bet hasn’t paid off. Aside from Lulu Wang’s The Farewell, which has been a critical favorite as well as a box office success, none of last year’s festival acquisitions have hit it big in theaters. (We’re not counting the documentary Apollo 11, a box office success, because it was acquired before Sundance.)
Box office disappointments
At last year’s Sundance, Amazon shelled out a whopping $27 million for a pair of comedies, Late Night, starring writer Mindy Kaling and Emma Thompson, as well as Brittany Runs a Marathon. Though the movies set the festival crowd abuzz, they didn’t generate the same level of enthusiasm when they hit theaters last summer.
Late Night earned $15.5 million at the domestic box office, and Brittany Runs a Marathon took in just over $7 million, which isn’t great once distribution costs, publicity, and marketing are factored in.
“There are a number of examples of terrific films that came out of Sundance and that for whatever reason didn’t break out as had been hoped. Sometimes it’s just kismet, the zeitgeist, or a particular set of circumstances, the competition, the marketplace,” says Paul Dergarabedian, a senior media analyst with Comscore.
Blinded by the Light, a musical drama set to Bruce Springsteen hits, seemed like a sure thing out of last year’s festival, where Warner Bros. imprint New Line purchased it for $15 million. During the film’s opening weekend in August, it eked out a disappointing $4 million.
“You’re seeing pretty clearly that movies coming out of the festivals are really being challenged,” Warner Bros. president of domestic distribution Jeff Goldstein told Variety at the time. “Unfortunately, audiences are spending money on the bigger spectacle films. The smaller niche movies are having a harder time finding their way when competition from content providers is making it harder to break through with an audience.”
Streaming services have disrupted the model for success
Theatrical grosses aren’t as important for streaming services such as Netflix, Amazon Prime Video, Hulu, or Apple TV+. Their business model isn’t based on box office grosses but rather on creating relationships with filmmakers, expanding content libraries, and gaining subscribers. If a big festival purchase manages to attract publicity, buzz, and possibly awards, it could make financial sense for a streaming or a cable network.
Last year at Sundance, Netflix bought Extremely Wicked, Shockingly Evil and Vile, a drama starring Zac Efron as Ted Bundy, for a reported $8 million.
Meanwhile, hoping for Oscar glory, Amazon shelled out $14 million for writer-director Scott Z. Burns’ well-reviewed post-9/11 CIA thriller The Report, starring Annette Bening and Adam Driver. It had a brief theatrical run (just long enough to qualify for the Academy Awards) before hitting the service. Amazon didn’t release any box office or streaming data, so it’s hard to gauge the film’s commercial success, but it failed to nab any Academy Award nominations.
Jennifer Salke, head of Amazon Studios, has said that box office returns are not the ultimate gauge of a film’s success.
“We look at it completely differently,” she told IndieWire last year. “Our customers love us having a great selection of movies on the service. We look at it that way. The theatrical is there for, you know, hopefully we have a hit movie or something great happens. But if not, we know the value of what those movies provide on the service for our customers. So it works for us.”
The theatrical market for indies has shrunk
There is some concern in the industry that deep-pocketed streamers have driven prices sky-high and that buyers, including film independent distributors, may have cold feet after last year’s box office disappointments. It doesn’t help that the theatrical marketplace for independent films (those not produced by the major Hollywood studios) has constricted as mega-blockbuster franchises dominate.
Neal Block, head of distribution and marketing for independent distributor Magnolia Pictures, which has distributed many Sundance films, recently told Filmmaker Magazine that 2019 was “a tough year for the theatrical marketplace. Potential audiences are flooded with pretty bad news all day, and it’s harder and harder to get them to pay to see a film that isn’t sold to them as uplifting or as a piece of entertainment.”
With the glut of content available on various platforms, it’s harder than ever for indie films to break out—especially in movie theaters. Still, it seems as if there’s always one Sundance film that manages to reach a broader audience.
In 2019, that was The Farewell, which indie distributor A24 nabbed for around $6 million following a bidding war. It’s gone on to gross $17.7 million domestically.
“For me, The Farewell is the best-case scenario for a Sundance movie,” says Dergarabedian. “That movie had a lot going for it. It’s a very family-friendly, warmhearted film. It got great reviews. While $17.7 million may not even be the catering budget on a massive blockbuster, for a movie like this [that’s largely subtitled], that’s a really nice performance.”
Documentaries are in demand
Meanwhile, documentary films continue to be a hot commodity—particularly since they seem to perform well on streaming services, and, occasionally, in theaters. In 2018, three Sundance documentaries grossed over $12 million in theaters, with Won’t You Be My Neighbor?, the Mister Rogers documentary, totaling over $20 million. None of last year’s documentary acquisitions from Sundance reached that level of box office success.
Independent film distributor Neon picked up a number of films at last year’s festival, including Honeyland, the winner of Sundance’s best world documentary prize and other awards.
Though its box office results underwhelmed when it was released in theaters last summer (it’s grossed just over $700,000 so far), Honeyland is far from a failure. After all, the Macedonian documentary about beekeeping (which has 99% critical approval on Rotten Tomatoes) just made history as the first film ever to be nominated for the Academy Awards for Best International Feature Film (previously known as Best Foreign Language Film) and Best Documentary Feature in the same year.
One documentary that will be looking for distribution at this year’s festival is the new film On the Record, from Academy Award–nominated directors Kirby Dick and Amy Ziering. Oprah Winfrey recently backed out as executive producer of the project about sexual assault allegations against hip-hop mogul Russell Simmons. It had previously been slated for release on Apple TV+.
What to expect at this year’s festival?
Despite some box office disappointments, the overall consensus is that the Sundance bidding frenzy will continue this year—as long as the individual movies deliver. “As always, it all depends on what’s there, but I think we’ll continue to see big outlays for good movies,” says veteran sales agent John Sloss of Cinetic Media.
A number of the buzziest films heading into Sundance already have distribution, including The Assistant, a thriller inspired by the Harvey Weinstein scandal. Indie distributor Bleecker Street will release the film in theaters later this month. Searchlight Pictures, Disney’s newly branded indie division, will screen Downhill, a dark comedy (a remake of the Swedish film Force Majeure) starring Will Ferrell and Julia Louis-Dreyfus, and Wendy, a reimagining of Peter Pan, from Beasts of the Southern Wild director Benh Zeitlin.
Netflix is bringing a number of films to this year’s festival, including the Taylor Swift documentary Miss Americana; Lost Girls, the first fiction feature from Academy Award–nominated documentary filmmaker Liz Garbus; and The Last Thing He Wanted, a political thriller starring Anne Hathaway, Ben Affleck, Willem Dafoe, and Rosie Perez. Other companies set to premiere films at this year’s festival include the indie A24, Hulu, cable networks HBO and Showtime, Sony Pictures Classics, and Focus Features, Universal Pictures’ indie division. Of course, they’ll also be on the hunt for more movies.
Regardless of box office potential, it’s clear that a high-profile festival buy still carries cachet in the industry—and that’s priceless.
“In the independent or specialized film world—and certainly at film festivals —it’s about the quality of the movie, the critical response, that’s of the utmost importance,” says Dergarabedian. “The box office is just gravy.”
More must-read stories from Fortune:
—Awkwafina Is Nora From Queens team: Asian-American representation is not a “fad”
—Parasite director Bong Joon Ho dissects his tale of two families
—The History channel’s aliens and UFOs content continues to blossom as Project Blue Book returns
—What does Parasite’s best ensemble win at SAG mean for Oscar?
—These Oscar Best Picture nominees are “problematic,” but will that matter?
Follow Fortune on Flipboard to stay up-to-date on the latest news and analysis.
