'Veronica Mars' Just Changed The Movie Business

In less than twelve hours, Warner Bros., Rob Thomas, Kristen Bell, and their Veronica Mars movie changed the movie business. Yesterday morning, Thomas and his cast asked fans to donate two million dollars to revive the canceled television series Veronica Mars as a feature film. Fans have hoped for such a movie for several years. Thomas and Bell had previously been unsuccessful in attempts to persuade Warner Bros. to fund the movie. They even talked about paying for it themselves.

It took about eleven hours for donors to pledge two million dollars. Now, Warner Bros. Digital Distribution has greenlit the film, and will pay for the marketing and distribution. Whether the studio will also contribute funds to the production cost remains to be seen. (Update: The Wrap says no; the outpouring of fan and media interest is likely to drive the budget funds higher without any extra capital required from the studio.)

So what did Veronica Mars fans say this week? Individual donors who gave just a little bit get to see a movie they might have thought wouldn't ever materialize. Seems like a good deal.

Collectively, the fanbase sent a thundering message to studios. It said, loud and clear, that it will give up large sums of money, with no traditional investment ties, to fund a geek-oriented project. There will very likely be further developments in what could be known as the Mars model, with other producers and studios attempting to find similar fundraising success. As the Veronica Mars counter ticked quickly up to $2m, we watched the business change in real time. 

Plenty of films have been financed by Kickstarter. SXSW is going on right now, and quite a few of the movies here were partially or wholly funded by Kickstarter or IndieGoGo campaigns. They're films made by individuals, rather than corporations, and probably would never have been able to exist without crowd-sourced funding. That's the whole idea behind these crowd-funding opportunities.

Veronica Mars is not like those other films. It is a project from a company that could fund production if it really wanted to make the movie. And since Kickstarter is an investment scheme that gives out fan rewards rather than profit points, funding a corporate project using the service is... let's say a creative use of the ideals Kickstarter represents. Veronica Mars is a project in a strange position: creator-driven, but corporate-owned. Fans and creators get their movie; the company gets the chance to make money from the funding and effort.

Donating to any Kickstarter project comes complete with the knowledge that any individual is giving their money away almost for free. Some Kickstarter films do get distribution, but even then, in the indie world as it is today, they are unlikely to make money. If WB is smart, Veronica Mars will make money. So far, WB has been very smart, from a business perspective, by gathering money it can now use for free.

Even after paying Kickstarter fees, taxes, and to create and distribute the incentive rewards offered to donors, the studio has (at press time) about $1.95m to add to whatever it already planned to spend on the movie. (A rough guideline to how much comes off the top of a Kickstarter campaign, I've been told, is 30%.) It may well end up with a lot more than that; there are another 29 days to go in the campaign. After those initial fees are paid, WB is beholden to no one for that money.

Think about that for a second.

How will this change film development? Outsourcing is the word plaguing the VFX industry right now, and fans just proved to WB that it can outsource fundraising for certain projects. This is a time when studios are less willing than ever to pay for development costs. (Ask a screenwriter about their one-step deal.) So what happens when a studio realizes it can get other people to pay for parts of the process, with only a couple strings attached? (Again, there are taxes, fees, and rewards to pay for. All one-time payments.)

The truth is that I don't know what happens. No one does. This is new. It might not be bad. Change looks weird. This might be the best way for creators to drive fan interest towards projects that aren't quite mainstream enough to seem like a sure thing to the board.

I'm not telling anyone not to donate, or that they should not have done so. It's your money. Do what you want with it. Terriers creator Shawn Ryan noted that this could be a model for creating a wrap-up film for that show, and I would be tempted to pledge should he announce such a thing. If someone wants to see a movie badly enough to pay thirty-five bucks, or two hundred, or five grand to do so, I probably can't talk them out of it.

(The average donation for Veronica Mars, at this point, is $60. Last night, when the project hit the funding mark, it was a lot higher. Pledging money, it is worth noting, does not entitle any backer to a copy of the film, or a ticket should it get a theatrical release.)

When financial situations are hardly stable for many (some companies excepted) I'm really eager to see how the value proposition works out in the long run. If Veronica Mars makes even five million dollars more than it costs to make and promote, that will be an incentive to studios. Will it look the same for those who paid for the movie — who made it happen not only with interest, but with actual money?

I said this on Twitter last night, and I'll say it again: the best thing Warner Bros. could do right now would be to return all donations, issue a statement that this was a bold experiment in marketing and gauging interest, and fund the movie as it would any other. Fulfill the rewards, as not doing so would be a PR disaster, and fans clearly want the swag.

But that won't happen.

Further questions are: can this happen again, and will the change it creates be brief or lasting? There are certainly other projects that could benefit from similar campaigns, though they may require a coordinated PR campaign to build interest before launching the crowd-funding project, to emulate the way that a Veronica Mars movie was discussed and teased for a long time before fans got the chance to contribute.
As for the persistence of the change, the cheaply-made hit The Blair Witch Project began a change in the movie business that couldn't really take hold until Paranormal Activity was marketed into a hit. We'll have to see if WB can make any money on this before knowing if it is likely to happen a few more times, or many.