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Patrick Goldstein and James Rainey
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Hollywood films on the cheap: Paramount's low-budget movie gamble


Let's call it the "Paranormal Effect" initiative.

Clearly dazzled by the fact that it could gross more than $100 million on a movie that barely cost $15,000 to make, Paramount Pictures is set to launch a new production wing devoted to films budgeted at less than $100,000.  As my colleague John Horn reported today:

"The as-yet-unnamed division's initial plan is to finance as many as 20 'micro-budget' movies annually starting in 2010... Funds for the movies -- about $1 million annually -- will be part of Paramount's existing production budget....Some of the movies may end up serving as 'calling cards' -- a showcase for a novice director's storytelling talent for a future project. A handful of films may contain enough good ideas to merit a bigger-budget remake. And another group may rise to the top of the heap, getting a theatrical release."

It's a fascinating, potentially game-changing concept, since it's a wonderful way for studios to replenish the pipeline with new ideas, but ideas that can be executed on a cheap budget. Even if most of the films never see the light of day, it could serve as a valuable way for Paramount to gain access to new talent, since presumably the studio would retain the right to make a movie with anyone participating in the program. It will also surely make Paramount a magnet for every good low-budget idea in town, encouraging young filmmakers looking for a break to send their scripts, demo reels and story outlines the studio's way.

But, of course, there are drawbacks. Studios are notoriously control-freak-style institutions. So will Paramount executives really be able to keep their mitts off these projects and refrain from trying to buff away all the rough edges? Can the studio execs refrain from giving the kind of soul-killing notes ("Can you make this character a little bit less unlikeable? Shouldn't we have a little more jeopardy in the second act?") that have been endlessly parodied by every writer who's ever spent more than a weekend doing a studio rewrite?

And since it's really, really tough to make a $100,000 movie while honoring commitments to SAG, the DGA and other unions, how will Paramount bankroll movies that presumably skirt union work rules and minimum compensation? (Paramount insiders contend that its union agreements contain provisions to accommodate the making of movies less than $2 million).

When I spoke to industryites around town this morning, they were both enthusiastic and skeptical. After all, other studio efforts to play in the low-budget world have largely failed, most recently with Fox Atomic. And for years, Paramount itself tried to make low-budget youth-oriented films through MTV Films, which had what was at the time the most valuable youth culture brand of all. But MTV never had the kind of autonomy that allowed it to pursue cutting edge ideas, the most notorious example being with "Twilight," which MTV had developed but which was killed by a top Paramount executive who didn't think teens would be interested in vampire movies. 

In other words, it's a pretty huge leap for a studio to give young, unknown filmmakers a big heaping dose of creative freedom. That's not to say it can't be done, simply that it will require a dramatic turnaround in the usual kind of executive mindset that controls studio production decisions. After all, "Paranormal Activity" is still a fluke -- those kinds of movies don't materialize every day. Paramount will have to be willing to absorb a lot of failure and creative missteps along the way while it waits for that one shiny diamond in the rough.

So while I'm betting this new movie division could someday produce a dazzling $100,000 cinematic gem, the big question is whether the studio -- being an institution largely built around short-term thinking -- will have the patience to wait for that gem to show up.

Photo: Katie Featherston and Micha Sloat in "Paranormal Activity." Credit: Paramount

Comments () | Archives (11)

The comments to this entry are closed.

Mmm...first piece I've read that accurately reported Paramount's plan and raise legitimate questions.

I haven't seen P.A. yet, but I read about it on a marketing blog that named the film its weekly 'winner' for its marketing strategy -

I think that keeping marketing costs down and doing smart, Efficient and Effective marketing will be an important part of giving this a chance to succeed.

While I think "cheapness" will be a hinderance to getting anything of a quality that audiences will want to go to a theater to see, why must the program be limited to "young" filmmakers. There are a lot of older people who never got their shot, including many who have been working within the industry for years who have the knowledge and experience to do something potentially interesting and ambitious on those budgets if, as Mr. Goldstein points out, the studio leaves them alone.

Rick Mitchell
Film Editor/Film Historian

Wow, are you kidding me.


The thing that might keep the execs' hands off is that it would only take one of these 'micro-budgets' to become a hit and it would essentially pay for itself even if 15-20 other movies from this division flop. Also, if you're a big studio exec, you're probably going to spend the majority of your time dealing with your big summer tentpole picture than you will with the tiny movie with barely a seven-figure budget.

This has been proven in the past to work. Take the Blair Witch Project that was a huge Box office success. Some of the most expensive films have turned out to be box office flops so price is not a 100% a factor in creating a box office smash hit.

This article and other headlines elsewhere give the impression that Paramount produced or had something to do with taking a risk early on with Peli to develop this film. According the film's website: "After just seven days of shooting, with support from Taylor and Zbeda, who contributed everything from story ideas to props to stunt design and execution, Peli loaded the footage into Sony Vegas editing software on his home PC."

Paramount stepped in only after audiences at festivals had taken to the film. It seems disingenuous that they take credit for this film, and I doubt something this original could ever work its way up a big studio development food chain and keep its integrity and genuine indie core intact. Notice the film is about telling a great story, not strategic casting to develop marquee recognition for the next installment in the "Twilight" series.

I hope Paramount searches out beyond the usual channels to bring in new filmmakers for this venture. If half the directors are not top-5 film school grads who nonetheless created great short films, that would be a fine start.

I think you should remove the Comments function off the page when there is no one around to moderate. There could have been a great discussion going over the weekend about this.

Universal did this in the early 70s and managed to end up with American Grafitti, Silent Running, and The Hired Hand. Of course, it also ended up with The Last Movie.

If the STUDIOS want to make money then they should start by reading more scripts that come from OUTSIDE the 310 area code and the LA basin.
Original stuff works, remakes don't, case in point, Lost World a horrible 310 film, Year One, another horrible film. Need to read more outside the inbreed gene pool.

The problem in Hollywood is they don't READ scripts that come from outside area code 310 and that is why so many good movies are not made and why so many bad movies are. They can't think outside the box and the irony is it is outside the box office where the line forms to see a movie or not.

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