Shake That Back-End: Sundance Dealmaking

In the Village Voice this week, I surveyed some of the sleepless dealmaking that went down at Sundance 2006 in an article titled "Gross Points." The title (not mine) is a fitting one for the festival, in more ways than one. But the literal meaning is an important issue and one that I didn't fully address in the story. Both the deals for "Little Miss Sunshine" and apparently Lions Gate's buy of "Right at your Door" involved a back-end cut of the grosses for the film's producers, in addition to the headline-making upfront sales fee. I don't know if this is always the case for bigger films at Sundance, but Warner Independent Pictures president Mark Gill told me he is seeing a shift.

"The significant change is giving sellers back-end first-dollar gross," he said. "It happened with Michel Gondry's 'Block Party,' and Picturehouse's 'A Prarie Home Companion' and 'Little Miss Sunshine.' Ten percent of the gross -- that's very new to the business." he continued. "If you're failing, you could be paying somebody and losing money, and if you're succeeding, you're paying them more."

As someone who usually favors filmmakers and producers over the corporations that release their films, I'd think this is actually a good thing, despite how commercially crass it might sound. If sales agents can get more leverage and more profits for the filmmakers they represent, all the power to them. But I wonder if this could also create more animosity and divisiveness between distributors and filmmakers. Could this shift be potentially damaging after the deal is signed, when down the line the two parties must work together on a release, not as rivals, but as partners?