Alternative Methods to Film Financing in the 21st century: An Examination of Crowdfunding

Open Access
Author:
Burka, Chelsea Rae
Area of Honors:
Accounting
Degree:
Bachelor of Science
Document Type:
Thesis
Thesis Supervisors:
  • Orie Edwin Barron, Thesis Supervisor
  • Orie Edwin Barron, Honors Advisor
  • Maura Elizabeth Shea, Faculty Reader
  • Robert Macy, Faculty Reader
Keywords:
  • film financing
  • crowdfunding
  • film
  • finance
  • film industry
Abstract:
The global motion picture industry encompasses the production, marketing, and distribution of motion pictures to audiences around the world through theatrical and home media entertainment enterprises. Revenue relies on discretionary spending and is highly sensitive to technological changes. It is one of the few industries still dominated by a handful of American studios in terms of infrastructure, financing, marketing and distribution reach. However, the turn of the 21st century brought significant structural changes in terms of discretionary spending and technology that impacted industry profits. Widespread technological adaptations of broadband internet and mobile devices shifted the distribution model away from theatrical and home video sales to streaming movies directly to personal computers and smart devices. The paradigms have changed drastically, yet the major players have not caught up and are becoming increasingly irrelevant. This thesis will explore the shifting landscape and explain my predictions for where the industry is headed. In the next ten to fifteen years, I predict the film industry will see major changes in both the funding of independent films and their distribution. The future of independent film financing will be driven by the growing phenomenon of crowdfunding, whereby consumers of media content actively participate in its creation and production. Crowdfunding platforms such as Kickstarter and IndieGoGo have garnered immense traction and proven a successful fundraising model for creative projects, especially smaller independent films. However, they are still relatively broad in category and do not offer means for exhibition. I predict distribution will be skewed towards direct online streaming to computer and smart devices. As seen in the music industry, I predict there will be a major shift in the prevailing paradigms: from an ownership model to an access model; from an industry dominated by a few monolithic companies who control means of production and distribution, to a more democratized system in which consumers control content creation, and have multiple outlets to access such content.