Before we begin this third installment it is necessary to redress several key points of contention from the previous installments to better reveal what is at stake concerning the relationship between African-American Cinema and the American Entertainment Complex. Taken separately many of the business practices of Hollywood that have been noted in this series are rational and justified by the need to spend less and make more profits within this rapidly changing and expanding marketplace.

For example, 1) African-American films have little to no appeal in international markets and therefore African-American films are not marketed overseas; 2) Releasing two or more African-American films simultaneously would split the market and reduce each film’s respective box office profits and therefore African-American films are given staggered release dates to increase each film’s overall profitability; 3) Tyler Perry’s films are successful because he provides exactly what the entire African-American audience wants to see and therefore other African-American films and filmmakers are not successful because they don’t provide what the entire African-American audience want to see; 4) African-American films are given smaller screen ratios than White films because African-American films appeal to a small domestic “niche” market and therefore to give an African-American film an equal screen ratio and marketing campaign as other films in the same genre that have White actors in the leading roles, would be unprofitable. Again, separately these business practices appear fair and justified, but the overall cumulative effect of these business practices is that they discriminate and marginalize all African-American filmmakers and their films.(1)

Under the aforementioned auspices, all African-American films are treated as one singular genre no matter what the story or actual genre is within a single film, and subsequently these films are cordoned off into a Ghetto market- not a niche market- but a Ghetto market that does not allow or encourage African-American filmmakers to develop works beyond the narrow confines of what has already been established as successful (Tyler Perry) nor take advantage of the coveted international markets (where Hollywood studios make the majority of their profits). This “Ghettoization” of the African-American audience, their films and filmmakers does not acknowledge that a large percentage of African-Americans consume high concept Science-Fiction/fantasy films (The Matrix franchise, The Terminator franchise, and the highly anticipated Alien prequel, Prometheus), lily-white comedies (The American Pie franchise, Will Ferrell films), action films (Jason Statham films) crime films (Michael Mann’s films, Martin Scorsese’s Gangster and mob films), romantic films (The Notebook), family films (Are We There Yet?), horror films (The Paranormal Activity franchise, Saw franchise), rarified Foreign and Art House films (Battle Royale, Old Dog) and even the recently established found footage genre (Blair Witch Project, Cloverfield).

One of the great paradoxes of the African-American racial imaginary that affects our representation on film is that individually we think of ourselves as intelligent, strong, creative and dynamic, but when we think of ourselves collectively as a race we harbor an image of an ignorant, uneducated, misled and aimless step-child who must be appeased if we are attempting to make a profit in any representational art form that features African-Americans. It is really this internal image that must be overcome if we are to make any progress in the cinematic art and the film industry, for even the dumbest among us believes that they are intelligent and that its those other N**gas who are stupid. And finally the lie that African-American films have no international market appeal has been addressed in detail in a previous article, THE GREATEST LIE EVER TOLD TO THE BLACK FILMMAKER, but the fact that many foreign film buyers (the agents that handle the distribution negotiations for American films overseas) express their difficulty in selling African-American films in countries where there are few people of color reveals how foreign countries with large populations of people of color are deliberately neglected in these foreign distribution negotiations.

The truth that is often obscured by the green dollars of gross profits is that African-Americans watch, appreciate and contribute to the overall bottom line profits of every genre of American film, but we, as a race, are not allowed to take advantage of these genres nor their international markets with our own films. Therefore, the overall cumulative effect of Hollywood’s business practices is that they discriminate and undermine all African-American filmmakers and their works. Most detrimental is the fact that the deliberate barring of African-American films and filmmakers from international markets is a key interdiction that segregates African-American filmmakers from the advantages and luxuries of production, development, finance, and other aesthetic and technological crossovers that White filmmakers take for granted. So if you find yourself as an ambitious African-American filmmaker saying, ”I can’t,” it is not because of a lack of vision and creativity on your part, but instead it is because your spirit has been broken under the cumulative effect of Hollywood’s unfair business practices against all African-American filmmakers. Hence, what is at stake in this series of articles titled, ”Notes for a Revolution in African-American Filmmaking,” is a real and prescient discussion about how to establish a separate and greater film industry that allows African-American filmmakers access to the freedom and the ability to develop, finance, produce and distribute films within any genre across the globe.

Having already identified what could be called the two arms of the Hollywood power structure, horizontal affiliation and tacit agreement, we must now turn our attention to what could be called the two legs of the power structure which is based on the financial operations of the studios. Rather than attempt to untangle the complexities and intricacies of Hollywood’s financial operations it might be advantageous to look at it through the analogies of, “The Shopkeeper’s Till” and “The Devil’s Pie,” to better comprehend its function within the Hollywood power structure. These two elements must also be fully understood by all African-American filmmakers if we wish to create and sustain an African-American Entertainment Complex wherein which we have the power.

The Shopkeeper’s Till

Those of us who have worked in Retail know that you begin your typical sales day with $100.00 in your cash register’s till and you close your typical sales day by bringing the cash register’s till back to $100.00; all monies in excess of that amount are collected as “gross profit” (profits before the subtraction of labor, utilities, and other overhead costs). We would do well to apply the same model by analogy to the major Hollywood studios and their financial operations; all we have to do is extend our notion of a typical sales day into a sales quarter and increase the amount of money from a hundred dollars to several hundred million dollars. In Hollywood, each sales quarter begins with several hundred millions of dollars in the till. The budgets for a slate of films (five to six films of different genres which appeal to different targeted markets) are divided from this initial till: Tent pole summer blockbusters and digitally animated films like Transformers or Cars II receiving a lion’s share, family pictures, dramas, action films taking another large share, with comedies, horror, art house fare and finally African-American films receiving the least from the till for their budgets.

Of course, the films that count the most are the summer tent poles which have the potential to earn up to and beyond 500 million dollars domestically and an additional 500 million or more internationally in their initial theatrical release. The profits from a single summer blockbuster can potentially cover the budgets of all of the other smaller films, as well as, provide source funding for the next quarter’s slate of films. One of the keys to the financial health of the American Entertainment Complex is found in its ability to keep a production at its targeted budget. If any film, particularly a potential blockbuster goes over budget the risk of financial instability is increased drastically. This partially explains why Warner Bros. refused to extend Spike Lee’s initial 28 million dollar budget for Malcolm X (1992), as the studio was unsure and uninformed about whether the film would recoup its budget and turn a profit; it did, of course. Yet, there is a safety net to stave off financial instability and increase profits for every studio. Any Hollywood studio can cheaply acquire independently produced films that are targeted for a niche market and reap millions for their bottom line if the film proves to be either a “sleeper” hit like, My Big Fat greek Wedding (2002), or the film connects with a previously overlooked market as The Blair Witch Project did in 1999. Blair Witch was an independently financed film that was made for around 25,000 dollars, but grossed 248 million dollars worldwide for Artisan Pictures; a company that was subsequently purchased by the powerhouse studio, Lion’s Gate in 2003.

So, like the shopkeeper at the end of the day, the Hollywood Studio at the end of a quarter brings its till back to its initial several hundred million dollars for its next slate of films and keeps its short-term gross profits. These domestic gross profits for each film can then be reported as weekend box office numbers on news broadcasts and entertainment shows to encourage spectator interest and flaunt a rosy economic picture to stockholders. Foreign gross profits are noted by industry trade magazines and websites, but rarely reported to the general public. The most important take away points to remember from the Shopkeeper’s Till analogy is that the initial quarter opens up with the budgets for a slate of several films in different genres which are targeted to different audiences. With the aid of horizontal affiliation and tacit agreements with exhibitors each film (except African-American films) gets a prime release schedule and the widest possible screen ratio that insures the potential for maximum profitability.(2)

The Devil’s Pie

The second leg of the financial operations of the American Entertainment Complex has to do with the post-theatrical release of a film. Unlike a simple fruit and vegetable stand, the product that Hollywood produces and sells is non-perishable and can be repackaged and sold over and over again for decades and decades in different media and through different content delivery systems. The notion of The Devil’s Pie has to do with the ancillary markets wherein which a film is sold, licensed or shown: Home DVD/Blue Ray Discs, On line streaming and other content portholes, Premium cable and satellite channels, basic cable and Network television channels. The fact that a film can be seen/licensed/or shown again in a variety of media formats and outlets continues the significant earning potential of a film well after its initial theatrical release which in turn creates long term profits that support the financial stability of the American Entertainment Complex. Although the models for these post-theatrical markets are rapidly shifting (for instance, DVD sales are dramatically down from 10 years ago), monthly fees for cable/satellite and on-line streaming portholes are rising and continue to be cut-up and shared with all the Hollywood studios and parties involved. Similar to Royalty payments calculated every time a song is played on the radio, monthly cable fees are divided up among the major content providers through their films, television shows, series and specials that run on premium channels, basic cable channels, or on-line streaming; each title making so many pennies each time it is shown. Multiply the pennies by millions of households, hotels, motels and Holiday Inns and even a film that flopped at the box office can generate hundreds of thousands of dollars for decades to come until a profit is made.

What makes The Devil’s Pie so tantalizing for the Hollywood Studios at this moment is “Vertical Re-integration”, where studios are now creating and sustaining their own premium cable/satellite channels or buying television networks to deliver their content directly to the spectator without having to share profits with other cable networks like HBO or SHOWTIME. Under the old model, Hollywood studios would license their works for a period of time to the cable networks to receive a small portion of the pie. On-Demand, which allowed viewers to see recent theatrical releases in their homes, for a fee, changed the certainty of the old licensing model with the cable networks. And now with Sony Pictures recent announcement of a Sony Movie Channel, which cable and satellite subscribers would have to pay an additional monthly fee to receive, any movie studio could effectively regain control of the exclusive exhibition of their product in the home theatre market. This “Vertical Re-integration” gives the Hollywood studios the same control over the means of production, the lines of distribution, and the points of exhibition they once enjoyed before the 1948 Supreme Court decision which forced them to sell their theatres and leveled the playing field in a free market economy.

The major take away point of The Devil’s Pie analogy is that all films have a long-term profit making potential after their initial theatrical release and that cable, satellite and on-line streaming (as well as all future technological developments for content delivery) contribute a sizable amount of revenue for all the Hollywood Studios for decades and decades. The writer’s strike of 2007 was in part based upon the right of writers to share in the post-theatrical revenue of films, television shows, cable series, DVD residuals and compensation from new media portals like the internet that the Hollywood Studios were keeping in their coffers.

What can be discerned from these analogies is that the financial operation of the American Entertainment Complex is a two tiered system. The first tier rakes in the short-term gross profits from the domestic and foreign theatrical release of a slate of films targeted to different audiences. The second tier is a long-term revenue sharing split among the Hollywood studios and the major cable/satellite and internet content delivery systems. This second tier is modifying itself as you read this, so that if unchecked, Hollywood studios could have full control over the delivery of their content and earn a bigger slice of the revenue sharing pie. What this all means in connection with the establishment of an African-American Entertainment Complex is that we have to be smarter, wiser and stronger in our development and our overall goals; that is to say, even though I loudly applaud the efforts of AFFRM (The African-American Film Festival Releasing Movement) which attempts to release two to three African-American films per year in major market theatres, this effort itself is not stronger than a typical art house release of an African-American film from a major studio. The screen ratio is so small as to be negligible and the marketing amounts to word-of-mouth via the internet through articles and websites that exclusively target African-Americans. Moreover, AFFRM does not have the strength or the monies to produce a slate of films that target different audiences to be released during a prime schedule with the widest possible screen ratios. Nor can AFFRM negotiate foreign distribution and it does not have control over cable/satellite and internet points of exhibition.

Not to diminish the symbolic significance of AFFRM, it’s just that to form an African-American Entertainment Complex we need a stronger vision, a multi-pronged approach, a large amount of start-up capital, dedicated cable/satellite/internet portholes and, most importantly, we need a strategy upon which to gain access to power. The framework for such a strategy I believe can be found in the notion of, A Discovery Narrative that I discussed in my book, Screenwriting Into Film. Lest, I be accused of solely wanting to sell books, let me discuss it briefly here: “A discovery narrative is a narrative of deception that presents a series of mysterious events, actions or circumstances that are inevitably revealed to be a plot against a naïve, innocent or trusting character.”(110)

For a discovery narrative to be successful the naïve or innocent character must find out about the deception and use that very same deception against their deceiver to survive.

There are several classic and contemporary films that fit this narrative model: Rosemary’s Baby (1968), Alien (1979), The Untouchables (1987), Internal Affairs (1990), Training Day (2001), The Constant Gardener (2006), and many others. If we could imagine that we, the African-American audience and filmmakers are the naïve, innocent and trusting characters in a representational commercial art-form wherein which we are being deceived, then a way to access power would be to turn that very same deception against our deceivers. The fact of the matter is that the foundation for an African-American Entertainment Complex might not begin with what is considered a “Black” film, but instead with what is considered a “White” film. The next installment will provide a risk/threat assessment of an African-American Entertainment Complex. I hope to provide several answers as to why we have never attempted to build an African-American Entertainment Complex and several more answers pertaining to why we have to if we want the freedom and the ability to represent ourselves on-screen through films that we have made in markets domestic and foreign. Notes

(1) I should like to acknowledge here that I overstated my case concerning Tyler Perry’s success in the previous installment. I should like to amend the following statement from the second installment: “Hence Perry’s success is a wholly manufactured product of Hollywood’s power and control over its audience through its incontestable horizontal affiliation.” I change it here to this: “Hence Perry’s success within the cinema is a wholly manufactured product of Hollywood’s power and control over its audience through its incontestable horizontal affiliation.” This allows for the fact that Tyler Perry was previously successful with his stage plays and DVD sales of his stage plays prior to Lion’s Gate providing the funds for the production and distribution of his first theatrically released film,” DIARY OF A MAD BLACK WOMAN (2005).” I know this change won’t satisfy all of those who believe that I am “Anti-Tyler”, but it does respect the fact that Perry was a successful independent stage producer before he became the token of Lion’s Gate and Hollywood in general.

(2) For an engrossing picture of how Hollywood Studio’s calculate their gross box office profits and their net box office profits one is advised to read the book, Fatal Subtraction: The Inside Story of Buchwald v. Paramount by Pierce O’Donnell and Dennis McDougal, which tells the story of the lawsuit between writer Art Buchwald and Paramount Pictures’ film Coming To America that starred Eddie Murphy.

Andre Seewood is the author of SLAVE CINEMA: The Crisis of the African-American in Film. Pick up a copy of the book via Amazon.com HERE.