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Producer Puts Film, AOL Red to the Test

Times staff writer

Movie producer Adam Shapiro can’t wait to see how this thriller ends.

In a 21st century twist on direct-to-video movies, AOL plans to announce Tuesday that it’s premiering Shapiro’s new horror film, “Incubus,” in an unproven format: direct to download.

Time Warner Inc.'s Internet business will begin selling the movie, which stars Tara Reid, for $7.99 on its relaunched site for teens, AOL Red, starting on Halloween. DVDs will go on sale a month later.

Reflecting filmmakers’ growing hopes for Internet distribution, Shapiro and his partner decided to go direct to download after they were unable to find an attractive deal for theatrical release.

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“Faced with the choice of going the traditional route, which we thought was onerous, we decided, ‘Let’s roll the dice on this one,’ ” said Shapiro, a longtime film and TV producer.

But a high-profile direct-to-download experiment on Google Video fizzled early this year, when the indie film “Waterborne” sold only a few hundred copies despite heavy promotion.

Analysts also warned that, although technology companies are using movie downloads to promote everything including iPods and Web search, consumers haven’t shown a willingness to shell out cash to watch feature films on their computer screens.

“Everyone on the Web has an ulterior motive for having movies on their site,” said Tom Adams, president of Adams Media Research Inc., which focuses on the entertainment industry. “Producers have got to be cautious about believing there’s going to be a lot of unit sales in the early years, because it’s going to be years before you can get anywhere near the potential number of customers you reach through DVD or theatrical distribution.”

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In this case, AOL’s motive is promoting its Red site, said Malcolm Bird, senior vice president of AOL’s children and teens properties. Red attracts about 4 million teens a month as part of AOL’s subscription service, but the site is moving out to the open Web at b-red.comOct. 17.

Bird and Shapiro used to work together at Hanna-Barbera, the cartoon production company. While hanging out at Shapiro’s home in the Hollywood Hills this summer, Shapiro mentioned that his production company, Automatic, had recently finished “Incubus,” which was shot in Romania last year with a budget of about $5 million. He queued up the trailer on his big-screen TV.

Bird said the movie looked fun. When he heard it didn’t have distribution yet, he suggested selling it on AOL Red to promote the site’s relaunch. They hashed out the details: $7.99 for purchase, $3.49 for a five-day rental, no burning to a DVD.

“This is the beginning of what could be a major new distribution model,” Bird said. “We have no clue what’s going to happen.... We’re fully cognizant of the fact that he may not be buying a new house off this.”

Automatic agreed to remove some foul language and a sex scene to fit the Internet company’s standards. AOL plans to promote “Incubus” on AOL Red and AOL Instant Messenger. It also struck a deal with an advertising company to begin playing the trailer in 1,400 theaters two weeks before the release.

AOL will have an exclusive window to sell the film online for about a month. Automatic executives said they were in negotiations with home-video distribution companies to sell DVDs. They hope all the promotion on AOL will help boost DVD sales.

“We’re interested in breaking the [traditional] model, but we’re also interested in return,” co-producer Sherman Sall said.

The direct-to-download experiment didn’t pan out for Ben Rekhi, a Santa Monica director who said last January that he had turned down a $125,000 theatrical distribution deal to instead sell his film “Waterborne” through Google for $3.99 per download.

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Rekhi had high hopes for the service, but Google delayed the video service’s launch, the initial product was widely criticized as difficult to use and Rekhi said Google didn’t promote his movie as much as it had promised.

To make matters worse, Google’s automated tools told Rekhi that he had sold about 3,000 downloads of his film. In fact, he had sold about 300.

“What I had been telling people was a moderate success was now a total failure,” he said last week.

Google declined to comment on Rekhi’s complaints, but said it believes that Google Video is an effective way for video creators to distribute and promote their films and shows.

For his part, Rekhi says he still believes that digital distribution holds big promise for filmmakers, but he’s going to wait for the market to catch up. He’s seeking a traditional film deal for “Car Babes,” a new film he produced.

“I would be hesitant to take it to online distribution after our experience and what we’ve learned,” he said. “There will be a lot of sacrificial lambs at the beginning.”

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chris.gaither@latimes.com

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