Before you sign on with a film production company, make sure you understand the distinctions between a film distributor and a production company. Both parties need money to make a movie, but some crucial differences exist. Film distributors want to invest in your film and will often pay a small advance. However, they are concerned that the film might perform poorly in theaters. It is rare for a film to flop, but you can never tell.
A few key differences exist between a film production company and a distributor. First, a production company owns all of the copyright for the motion picture. This means they own the results and creative contributions made by the talent. The production company also owns the ancillary rights, such as music and location agreements. As a result, they should be protected from any lawsuits.
While film distributors used to send film prints to theater chains, they are now responsible for distributing digital cinema packages to theaters. Once a film begins its theatrical run, the distributor will send the digital cinema package to theaters. These theatrical runs typically last two or three months, with ancillary rights.
There are several differences between film production companies and distributors. A distributor will pay a small advance to the filmmaker for the rights to a film. They do this because they fear the film won’t perform as well in theaters as anticipated. While they rarely think a film will flop, they can make predictions based on reviews.
A film production company will enter into many agreements during the production of a film. These agreements cover financing, hiring talent, fulfilling guild obligations, and allocation of film revenues. These agreements are the foundation of a film project.
A cross-collateralization clause between a distributor and a film production company is an important document that protects both parties. Distributors want to protect themselves against the filmmaker’s attempt to avoid paying an advance based on false claims about defective materials. In some cases, filmmakers can demand warranties from distributors to protect themselves from unfair distributor practices, such as misallocating revenue from package sales, receiving hidden rebates, and profiting from the manufacture of deliverables.