In Virginia Heffernan’s article entitled, “Artists Only,” in the December 23 issue of the New York Times Magazine, she says, “For young people, joining a virtual community–one far vaster than can be cultivated in the finite social world–is the first step in fashioning an identity, and later an artistic persona. The trade-off for steadfastly supplying your network with your whereabouts and loveabouts is supposed to be that when you’re done free-associating about movies and you’re ready to make one, once your work is no longer a product of a quarter-life crisis but a confident and original form of self-invention, your carefully maintained ‘friends’ (would-be consumers and fans) will be willing to tune in.”

And in today’s virtual world, friends, fans and consumers are, more times than not, the same thing. To help harness that and to increase the ability of filmmakers to efficiently reach core audiences, Breakthrough Distribution, in conjunction with several partners, is building a cooperative database which will be called Indiefanbase. The site will attempt to aggregate and mine the fanbases of individual filmmakers, publishers and nonprofits to help market and target creative content and products. I spoke with Jeff Rosen, one of the four team members that run Breakthrough, about the enormous potential of the Internet and what the distribution company has in store for the near future. A designer of marketing programs for many corporate clients, Rosen is an expert in direct, database and Internet marketing, both for traditional and digital media. He also is a student of philosophy, literature and semiotics and our conversation does veer off into some esoteric thoughts on what all this new technology means. So from affordable DVD replication to the dialectics of Hegel’s philosophy of absolute mind, here’s our discussion:

Renew Media (RM): Breakthrough is fairly brand-new, is that correct?

Jeff Rosen (JR): Yes, we’ve only been in business about a year and a half.

RM: At the IDFA last month, I briefly met one of your team members, David Wachs, who was there meeting with European filmmakers and sort of being a Breakthrough ambassador, telling people about the company, etc. Debra Zimmerman, of Women Make Movies, was telling me about a conversation she had with him. She, of course, comes from a brick-and-mortar distribution model in how to acquire and distribute films. This is such a lightening-rod topic for a lot of people in the business right now, particularly in the independent film world, and what you guys are doing and the model you’re presenting to filmmakers is interesting because it’s DIY with professional assistance. I know that the traditional distribution community is kind of up-in-arms about all this, these new ways that people are starting to do business. I also know that filmmakers are really tired of losing creative and financial control. Peter Broderick is someone I, and many others, admire tremendously for helping to create this type of model and for being of service to this community that is in dire need of solutions. [Peter helped found Breakthrough.]

JR: What we try to do, in almost all respects, is to operationalize much of what Peter has been talking about for several years. There’s only one Peter Broderick, and he can consult with a filmmaker and assist him or her in customizing a marketing and distribution strategy, but there’s a gap in the actual execution of all that. And when a filmmaker is ready for this stage, he or she has probably spent several years making the film, spending his or her own money, his or her investors’ money, and now he or she has to start investigating sites, start following up with organizations that have an affinity with the subject matter of the film, and try and get those people to send out an email or a piece of direct mail to create an affiliate relationship with them. He or she has to try and find people in the community to evangelize or promote the project, engender a word-of-mouth campaign. If you don’t have $100,000 or $50,000 or even $20,000 to hire special ops media or a PR agency or other firm that can assist you with any combination of online PR, traditional PR and some of the other more basic ways of reaching out—calling a hundred or two hundred sites on the phone—all this is something most filmmakers aren’t prepared for, nor skilled in, nor interested in doing.

So what we’ve tried to do is create a ready-made infrastructure, starting with basic physical services, such as offering duplication and fulfillment services. A lot of filmmakers really don’t know about authoring or what’s involved in encoding, creating menus, nor are they conversant in the differences between duplication and replication and at which point it becomes more cost-effective to do one or the other. There’s packing, shipping, warehousing, setting up shopping carts, setting up sites to make that all work smoothly and easily. Our infrastructure is simple, easy and does a lot of that work for the filmmaker.

Stepping back a bit and talking about this on a higher level: if I was speaking to someone and they asked about what we ‘re trying to do, I would say that we help content creators. It’s principally been filmmakers, but we also work with book authors and musicians. We help content creators maximize their distribution possibilities via online, retail, theatrical, broadcast and other channels. We’ve developed an independent producer platform to be elastic with respect to the media. The platform provides rights holders with services, tools and strategic frameworks to leverage new business models, technologies and marketing approaches on a global level so they can fully exploit the economic value of their film or media project, retain all rights and control their distribution.

RM: Let’s talk about the rights part for a minute. That’s the biggest sea change of all, in my opinion. People are worried. And filmmakers are tired of being burned. The essence of sharing that exists on the Internet is really hard for people to wrap their minds around.

JR: I agree with you completely. It’s mostly affecting the intermediaries. We’re about helping filmmakers in the fullest capacity we can. We are creating a collaborative database that transfers a lot of the volume that entities like iTunes and Amazon currently control and puts it in the hands of the filmmakers.

It’s fairly easy to set up a web site and make 1,000 or 5,000 or 10,000 DVDs. A filmmaker can issue a press release. But really the critical piece is how to effectively reach core audiences and make them aware of your film. Just as there’s been a democratization in production, that is shooting a film fairly cheaply and being able to edit on your laptop on a scale that you never could previously, along with that you have enormous growth in terms of the number of projects out there. In addition to that, there’s only been about a 20% increase in theatrical releases. The studios have a bit more control, in some respects, because there’s so much more product to choose from. What we’re trying to do is to provide some kind of supply/demand equilibrium by helping fans discover films and, in turn, help filmmakers reach core audiences and establish relationships with those audiences over the course of their career.

RM: A matchmaker.

JR: That’s it—Fiddler on the Roof. Over the course of the last month, I’ve been working on a project and brainstorming with companies like Renew Media, and filmmakers like Lance Weiler and Arin Crumley and Susan Buice and other artists in the independent film community that have been working in this way organically, and have been working at the forefront of this more progressive marketing and distribution approach. Basically, the concept of all this is based on the catalog business, on companies like LL Bean, Speigel and others, that utilize and collect data—-they’re not looking at it as a zero-sum game. In data-based marketing, there are different variables, such as how recently a customer has purchased something, the frequency with which they purchase products, how much they spend on average, their demographic data. How can we enlarge the pie so that the group of people that put data into this database can take a share from these larger retail entities? And how can they get to those people who will purchase at the right time so that it will generate a sale? It’s utilizing the most efficient marketing strategies possible. I think the Indiefanbase can be built cooperatively to market those products in which fans are most likely to be interested. Amazon’s collaborative filtering is the model—you bought this, you’ll probably be interested in that. When you’re just one filmmaker—even if you’ve sold a lot—it helps if your film can be connected to another film that’s done good sales as a recommended purchase. We’re trying to leverage the network of data as opposed to each individual filmmaker having to struggle on his or her own to get their message out. We’re also looking at behavioral data because we want to be able to create a “boutique indie-Amazon,” if you will. There will also be music and books in addition to films.

RM: All indications are that this propensity for curated media is only going to grow due to the overwhelming glut of content out there. It’s vital for the artistic community because both artists and audiences are kind of lost in the wilderness. There’s sensory overload pretty much on every side. How does this all work?

JR: I’m working now with Lance. This is someone who can make a film, build a web site, fix your sink—his technical abilities and diversity of talents are amazing. In conversations with him about helping to conceptualize this and helping us build this, and seeing the work he’s done, I know he gets it.

There will be a format where filmmakers provide us with their data, and that data will be secured and housed in a third-party bank like Axium, which stores credit card data and other things that require high security. Breakthrough will not own this. It will be an open source platform

RM: How are you making yourselves profitable?

JR: That’s a good question. I’m trying to answer that myself. The way I believe we’ll be able to benefit is the following: if we can bring in some filmmakers, authors and musicians that are respected and have achieved some success in the community and they, too, are participating and contributing to this database, Breakthrough will act as an overall facilitator. For those content creators that want to use us for some of the services we provide, we can do that. But the option is there for them to utilize some other vendor if they so choose, or customize their strategy any way they want. We think we provide good services at a very good price and we’re trying to do things that are of value to filmmakers. We provide lower replication costs than anyone else out there. We have clients for which we will produce something along the lines of 20 million DVDs, a huge volume for some corporate client, that, in turn, allows us to provide very good rates. One of the things we’re going to be doing on the consumer site is providing digital downloads on behalf of filmmakers, but we’re going to be charging far less than other companies like b-side or Jaman or other companies that take 50-60%. We’re going to provide the majority of the pass-through profit to filmmakers.

Our goal is to provide a full range of services, so there’s an opportunity for us to make a small piece in a number of different ways throughout the service cycle. We’ve reached out to other various service providers with whom we’ve negotiated big volume deals, so we can provide the artist with lower costs than he or she would be able to acquire on his or her own. They can use our purchasing power to their advantage.

Our goal is to forge a rich, creative community in which producers and fans can effortlessly discover one another. To support this, we’re going to be doing a few things. We’re going to provide a free web site similar to what Without a Box does that will contain a toolkit so that filmmakers can be part of this collaborative database and be able to contact audiences which, in turn, fosters co-creation. What Matt Hanson is doing with A Swarm of Angels is just amazing. One of the things we want to do on the site is to provide curatorial services of some sort because there needs to be a reasonable expectation that the quality of content is going to be strong, otherwise, it’s going to be difficult to have a viable position in the marketplace.

RM: Who will those curators be?

JR: The filmmakers with whom we work who are already self-distributing. The goal is to have people who are doing it on their own—the Peter Broderick model is one we hope more and more people will utilize so that they can maximize each opportunity that comes along. We wouldn’t really be driving anything along the lines of Little Miss Sunshine or other successful Hollywood independent films, but rather we want to be promoting the films of the filmmakers, authors and musicians we’re working with and complementary projects that grow from those. David Zeiger, the director of Sir! No Sir!, has a new companion project that Jane Fonda was involved with many years ago. He also sells books off his site, buying them wholesale and selling them retail.

The bottom line is that we want to be able to provide a service so that filmmakers are not solely relying on people coming to their own site. It’s about creating a destination site that has a variety of user-generated recommendations, reviews, tools and different ways of discovery. Many of these products may already be on Amazon, but they’re lost among millions of other products that have no relation or validity to the purchaser. Amazon does a great job, so does Rhapsody, in terms of showing filmmakers who the influencers and followers are, turning a user on to new people and products. The use of recommendation engines which we’ll create is important. Arin Crumley and Susan Buice have something on Spout that’s been a great source of word-of-mouth and income for them and their projects.

Yes, you can get this from Amazon right now, but by coming through Breakthrough, the filmmaker can grow a patron/artist relationship, while at the same time, also growing a database for future projects, for things they recommend—-there’s your curatorial aspect. If you like someone’s sensibility, chances are you’re going to be interested in what they have to recommend. Kanye West said that, in a couple of years, there won’t be any more labels or those labels will be fluid and formed for a project or two and then disbanded to start something new. An artist can now do a geo-sort from his database on myspace, for instance, and send out an email to all the people in a certain location, bypassing having to hire a local promoter or do any kind of local press and sell out a concert, a screening or an appearance, selling tickets to fans at a lower cost because you don’t have those middlemen anymore. And that money goes directly to the artist. There’s also a real connection, a relationship with fans that enriches that relationship all the more for both artist and consumer.

RM: Going back to traditional distributors—I guess what they must be wondering is if they’re currently using a tub stopper for some Niagara-like wave. This model makes so much sense for independent artists. In fact, why wouldn’t you remain an independent with all these tools available to you? That’s really the question.

JR: When there were three major network TV stations, you had mass marketing that worked incredibly effectively. Now that audience consists of hundreds of segments, and there exists the ability to reach an audience of one, or some micro-niche in which you can use the exact kind of language that will engage them, that will resonate with them. The current system can’t be that effective, that efficient, not to mention the less-than-transparent accounting practices that give all these marketing people big, fat salaries for doing very little. Artisan has still not made The Blair Witch Project any money and that was a huge hit.

There are filmmakers that have won prizes at Sundance that weren’t even given any kind of advance from distributors. If you’ve won a prestigious film festival and you have no kind of advance and you’re not really going to make anything on the back end, what are your options? They’re not great. The opportunities are becoming much better to directly support the artist—to me, that’s the most important component to all of this.

In the UK, every Sunday, in the newspaper, they give away a free DVD or free CD that’s inside every major paper. Prince recently gave away 3 million CDs. We work with a replicator over there who’s pressing quantities of 8 million for major artists. When Ocean’s 13 was being promoted in theaters, copies of Ocean’s 11 were given away to generate awareness of the new film.

There are non-exclusive deals to be made with different content aggregators, limited retail deals where certain companies will represent the film for a certain period of time. Distribution is a creative act. It’s not static; it’s not monolithic. A lot of it is what you can negotiate and, honestly, how cunning you can be, how crafty you can be in forming different partnerships. What someone like Robert Greenwald has done is pretty astounding. Lance has done some great things; so has Arin.

There’s no road map. That’s both exciting and frightening. There’s no formula or set way of doing any of this. And it’s really dependent on what your project is, what your film is. What worked for Arin and Susan, based on the kind of very personal project they did, might not work for someone who has a very different film. But, other projects like their video blogs grew organically from that and are pieces just as long as the actual film itself.

RM: The bottom line is adjusting to that fluidity, that elasticity you can have with your project. And companies are having to keep abreast of the current wave technically, and philosophically really, in terms of the way people want to interact with their media. It’s going to be a necessary thing to keep them competitive in the marketplace.

JR: Listen, you have kids watching the first quarter of a movie on a big flat-screen TV, the next part of it on a DVD player in the car, and maybe watching the last bit on their iPod. To be able to deliver a film, anytime, anywhere in the world digitally, instantaneously, being able to utilize a variety of devices on which to watch something, these are the new components of the user experience in interacting with media. And we are intent on helping a filmmaker monetize all of this opportunity and maximize his or her revenues. And maintain artistic and financial control. Obviously, now the risk taker becomes the filmmaker him- or herself instead of the studios, publishing houses and record companies who are no longer putting up any kind of advances. However, they’re also not reaping any kind of benefit from the artist’s work, either.

We’re working on a project that was given a seven-figure advance from a major studio. And the filmmaker turned the deal down. The film cost $2.4 million and they’re self-distributing in a lot of interesting ways, working with Peter Broderick. I’m not at liberty to say more since we’re meeting on this shortly. But we’re going to be seeing more people like John Sayles and other major creators in film and music doing a combination of self- and assisted distribution. As bandwidth increases and the ability to find content becomes easier through collaborative filtering or any other number of ways, the easier it will be to discover and have access to any media one wants. And there are people who are having audience members be financial partners/producers and that’s having an enormous impact on content. There will be new, inexpensive ways to acquire archival footage and have it delivered directly to your web site.

The piece I’ve been really struggling with is how can we create an infrastructure that accelerates and makes it much more efficient to reach audience in an intelligent way, a way based on data—behavioral, personal, special-interest? Shares will eventually shift from the Amazons, and other large entities, directly to the filmmaker. The fundamental question on some level is if you’re not offered anything of value, what are your options if you need to tell your story? If you want to try and recoup your investment? Or find a producer to fund your next film?

RM: Well, I think that’s what artists are concentrating on, to be perfectly honest. We just want to be able to make some kind of living from the content we create so we can keep creating more. No one’s looking to get super rich. Well, maybe some of us are. But to be able to live and work as a filmmaker, writer, artist, musician and create income and revenue from your own work so you can be self-supporting in that regard is, to me, the major lack we have in this country, in terms of how we fund and support the arts. In a way, you can become your own mini-studio with a creative department, with a finance department, with a production department, with a PR department, etc. And from there, a multitude of collaborations can take place between all different kinds of artists. Financial freedom enables creative freedom. Artistically, we’re just beginning to figure out the possibilities that the Internet can offer. The architects of all of this are making that possible.

JR: Yes, we’re all learning how to harness that. We’re in medieval times compared to where we can be. The Internet has the potential to be a combination of the Library of Alexandria and Hegel’s notion of Absolute Mind.

RM: The human community, as a whole, the “global” mind.

JR: Yeah, basically, everything’s in there. It’s coming to the self-realization of itself and actualizing its possibilities.

RM: This is a big discussion at the TED Conferences. All they do is talk in terms of global vision and the interconnectedness of all things. Negroponte has been talking about this stuff for decades. But it’s taking all this philosophical loftiness and creating a business model, some tangible structure, and making it operate in the real world.

JR: We’re doing a film called The Singing Revolution, about the Estonian revolution; about 30% of the population of the country gathered in a field singing a song that was banned by the Soviets during the time they controlled that country. One of the people behind the film is the first Prime Minister of that country in its post-Soviet era [Andrus Ansip]. Oprah Winfrey is also a powerful figure that’s moved projects along just by her notifying the public that something exists. And word-of-mouth, in the end, is really the key marketing component for everything, especially if it’s from a trusted advisor or friend whose taste and sensibility you’ve come to respect and value. The Internet can really support the building of these trusted communities. Everything else is wall-to-wall advertising. It’s a semiotician’s dream. Or nightmare, I don’t know.

RM: What we’re inundated with is untrustworthy media, essentially. You’re talking about a shift in the way in which people are being marketed to.

JR: It’s the concept of being able to discover the artifacts that are meaningful to you, where it’s not completely mediated by PR agents and ad salespeople. That super-structure has been fixed and in place for a long time. It’s hard to shift that. But the Internet does provide a lot of possibilities. To an extent that there can be a community that is honest and transparent, I think the possibilities for that are only increasing, and people will continue to use their ingenuity in building both institutional and personal relationships and working with influencers or connectors and reaching people effectively whether it’s online, whether it’s at house parties, special events, etc. It’s really about defining what your goals and objectives are and figuring out how to convince consumers that they need to see/download/rent/own your film.

It’s a disruption to the people in traditional media. There are people who come from that world, however, that are doing interesting things, people like Richard Lorber who has a new company called Lorber Media. Richard adapts.

RM: Because he’s an artist, too. That creative impulse is where this all begins, whether you’re a first-time filmmaker, or a media mogul.

JR: Creative destruction can be painful, but it’s necessary to build new models and to keep growing. In the end, hopefully, you have more efficient processes. It’s unforgiving to many, but some structures that are in place now, that have worked for a long time, are becoming increasingly hard to sustain. But major music and film artists are walking away from big studio or record company deals and structuring their own business deals with a variety of independent outlets and retailers and other vendors. At this point, we’re only constrained by our lack of ingenuity.

RM: It’s exciting for all of us to be in the middle of this big mess, trying to figure it out as we go.

JR: Going back to Lance—I think what his Workbook project does really well is illustrate that there is an arsenal of tools at content creators’ disposals, and that the more proficient you become at utilizing as many of those tools as possible, the better off you’ll be—distribution, technology, consumer purchase and consumption patterns, pricing strategy. Certainly, you don’t need to know everything about everything, but the more you know, the more capable you are in navigating this terrain, the more capable you are of succeeding. It’s just time to take advantage of this kind of global thinking.

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