Is DIY Film Infrastructure on the Brink of Collapse?

Theatrical-crowdfunding platform Tugg is dead. What does this mean for indies looking to get their films onto the big screen?

8 years in the running and Tugg has closed its doors to its employees, filmmakers, and prospective theater-goers. In the wake of our coverage of the Distribber bankruptcy, what does the loss of another DIY film mainstay mean for filmmakers? If the algorithms are supposed to save indie film and get our audiences to see our movies, why did Tugg fail? Here’s an outline of what happened and what it all means for the indie film world.  

What is Tugg and Why Did it Go Under?

Tugg was what we call a theatrical on-demand platform. If you had a feature film, you could put it on Tugg for free (less the cost of the DCP). From there, you or a fan could set up a screening in a theater within Tugg’s network, and if enough people bought tickets to see it ahead of time, the theater would have a special screening of the film.

I wrote two in-depth articles about how I successfully used Tugg to get my feature documentary Brave New Wild, in theaters. I outlined in detail how the Tugg model could be applied to different types of films and exactly what you would need to do in order to set up a screening and sell enough tickets to make it happen.

Then, at the end of January, the CEO of Tugg sent out an email that Tugg was effectively dead.

So what happened?

My Personal Experience: Good but Short-Lived

I was incredibly excited about Tugg and very happy to have pulled off Brave New Wild's theatrical run using the platform. However, after a while, I got tired of all the work involved in pre-selling the tickets and managing the screenings myself. When I stopped putting in the effort, the screenings stopped. Despite fans of the film who approached us about screening it, and sometimes attempting to do so, the Tugg platform proved too difficult to use.

My current belief is that the platform was not successful enough to become self-sufficient for most filmmakers when they, too, stopped the initial effort. If we know anything about ourselves, it’s that we have a limited number of hours in the day to dedicate towards one film before we must move on to the next film. (Not to mention, returning to our paid video gigs or day jobs.) Yes, some filmmakers were able to get screenings off the ground organically through niche audiences (e.g. Touch the Wall that made $700K as described in Alex Ferrari's book Rise of the Filmtrepreneur). But it seems likely that they were probably the outliers in a sea of moderately successful films which didn’t make enough for the Tugg percentage to keep the lights on.

We haven’t been able to speak directly with a Tugg representative, so we can’t know for sure. Below is a description of the demise in an email from the CEO.

Letter from the CEO of Tugg on Missing a Last-Minute Deal that Fell Through

Tugg first let people know about their closing in a short email. This was followed by a longer explanation below, which outlined the shuttering of the company due to the failure of a last-minute hail-mary partnership at the end of January.

Letter from Pablo Gonzalez, CEO, Co-founder Tugg:

The letter, which can be read in its entirety here, goes on to describe the current status for filmmakers:

How Tugg Began as a Genuinely Filmmaker-Friendly Platform

While our investigations into Distribber showed that the founders were not necessarily film people, Tugg came from the duo of a film producer and a business person.

Tugg was first launched at SXSW in 2012 by Nicolas Gonda and Pablo Gonzalez. (It incorporated in 2011.) Gonda is an Austin-based producer who, among others, is a producer of nearly all of Terrence Malick’s films, like Tree of Life and To the Wonder. Gonda would have understood the intricacies of film budgets (albeit bigger than the average DIY film budget) and the film industry. Gonzalez, on the other hand, brought in 12 years of experience in development and marketing, with an MBA in Business, whose straight-up business skills would be welcome next to Gonda’s film producing.

Credit: BizJournals

Here is how Gonda explained his interest in starting Tugg in a 2013 interview:

Credit: MotionPictures

We assume, based on LinkedIn, that in 2016, Gonda either left Tugg or his presence was largely reduced, most likely as he continued to be a producer and executive producer on more films. Gonzalez then went from COO to CEO.

Implications for Filmmakers Using Tugg

If you currently have a film on Tugg, then your best course of action is asking for your DCP to be mailed to you at your expense.

If you have money owed, or upcoming screenings that have been canceled, or worse, successful, then your best bet is to keep up with the Facebook group Protect Yourself from Predatory Film Distributors/Aggregators that had originally been started by Indie Film Hustle’s Alex Ferrari to help filmmakers in the way of Distribber’s fall out. From there, you can see what other filmmakers are doing and try it out for yourself. If the description in Tugg CEO Pablo Gonzalez’s email is correct, then Tugg is attempting to work through unfulfilled orders and sales reports. But if their finances are actually completely frozen, there will not likely be remuneration any time soon.

Interpretations: Two Ways to Look at the Death of Tugg

The basic question indie filmmakers face in light of Tugg’s demise would be: is this merely a growing pain of a viable DIY film environment, or are we beginning to see the crumbling of an infrastructure that proved not sustainable?

Option #1: Tugg Going Under is a Sign that Theatrical is Dying.

It’s possible that Tugg going under has more to do with how audiences are consuming media these days. I love going to the movies with a full audience because I love the collective experience of watching a movie with a crowd of fellow movie-goers. But I barely go more than once a month. When I go, it’s to see a film I have heard of because of millions of dollars of P&A funds that have alerted me to the film, how great it is, and when it is playing.

The odds are against independent filmmakers in the sense that seeing a film in a theater is not as part of the fabric as it was before. While you can see from the chart courtesy The-Numbers.com, film sales have been going down, only buoyed by the fact that profits continue to go up because tickets are now more expensive.

Credit: The-Numbers

Not All Theaters Joined the Tugg Network

In the face of these odds, it doesn’t help not all theaters were in the Tugg network. Tugg was successful at bringing in many theaters, but many others remained unconvinced. That’s a serious problem for filmmakers and audiences who want to see the film locally, but find that there are no ideal theaters nearby. I came across the problem with our Tugg theatrical tour, where someone would contact me about this great theater that they would love to show the film at. A lot of the time, that theater would not be part of the network.

Maybe more theaters would have joined if more films were successful on Tugg, but it’s hard to say.

Not All Niche Audiences Wanted to Go to the Theaters in the Tugg Network

Tugg works best for films with niche audiences, but there is an inherently big problem with this for theatrical. If your niche audiences are hardcore swim fans who will go anywhere to see a swim movie with their swim buddies, great. But if your niche audience is full of dirtbag climbers, they are probably used to seeing films projected on a blow-up projector in the desert or the side of a wall in a climbing gym. They will not be as excited about going into a plush multiplex theater to see a film extolling the virtues of original fringe elements of dirtbag climbers…that they just spent $15 to see.

...the main question for Tugg is the same for Distribber, why are indie filmmakers not making more money with their films?


Option #2: Tugg Went Under Because the Average Indie Film is Not Making Decent Money.

This option offers a far more sobering perspective: the average indie filmmakers are not making enough money to keep the platform going compared. If a filmmaker is making $100-$500 per [successful] screening before costs of personal time and ancillary things like posters and Facebook ads, that means Tugg's cut is not astronomical either. This can certainly be linked to the flaws in the platform that are mentioned above. But broadly speaking, the main question for Tugg is the same for Distribber, why are indie filmmakers not making more money with their films? Either there is no audience for our movies, or the overall infrastructure is still not getting those audiences to hear about films that are coming up without traditional distributors. In other words, we are just not there yet.

What do you think? Will do-it-yourself filmmakers have a future in the film industry?

Let us know what you think in the comments below.     

Your Comment

7 Comments

Tugg was terrible to deal with and their thresholds were such that there wasn't much money to make for the effort. My movie Neither Wolf Nor Dog has had thousands of theatrical showings all booked by myself and we've been on in around 600 venues. Tugg was almost entirely useless to me whereas we should have been the perfect film for them to get on hundreds more screens. We've sold over 100,000 tickets by booking cinemas the old-fashioned way and typically we walk away with 50% of the box office. You can see my TEDx Talk I did on it on youtube (though the release was quite early on when I did the talk)

February 18, 2020 at 2:47PM

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Steven Lewis Simpson
writer, director, producer, distributor
89

Hi Steven,
thanks for sharing. Just checked out your TED talk, super inspiring. Where can I find the film? VOD or is Kapanamedia the only way right now (to order the DVD)? Is the film coming to Europe? I'm based in Lisbon, Portugal.
Thanks

February 19, 2020 at 3:13AM

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Hey Steven your example about Neither Wolf Nor Dog is very inspiring! I think you also brought up a good point about Tugg and the problem with its model: the high threshold for minimum tickets. That never made sense to me. Why would a theater demand an indie filmmaker pre-sell 75 tickets, when right next door, in another screening room, there are only five people watching a regularly scheduled showing? Would love to know if you had a formula for how many tickets to pre-sell for a successful showing, as clearly you were doing great outside of Tugg.

February 20, 2020 at 11:22AM

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Oakley Anderson-Moore
Writer
Director/Shooter/Editor

that title tho...

February 18, 2020 at 10:07PM

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When some of the best movies of 2020 stream seamlessly on Netflix, or you can find incredible classics, arthouse and unique international films on Mubi, or rent a new release on Itunes, its really really really hard to convince people that a little self funded film is worth the cost of two months of Netflix (plus food, parking, time etc) and the same as a $300 million dollar blockbuster to see in a cinema... The business model doesn't make sense, and value isnt there for the consumer anymore.

If you have made an independent film on a shoestring budget, trying to put it into cinemas is really just a vanity play. And we all want to see our work play on the big screen - buuuuut IMO - if it isn't getting selected for festivals or a certain teir of festival, eyeballs on the project is more important for career development IMO than where the eyeballs are situated. Get it out online, give it away, get a buzz, do a ted talk, build a profile but it doesn't seem worth it from a monetary point of view....

And i just toured with a feature documentary I produced and starred in (Finke:There and Back) it sold out every screening on the tour (13 stops) including a sold out Imax screening. And thats all well and good but it cost more money* to run the tour in travel accommodation and time than the film made in those screenings. And the your was meant to create hype to get a bigger cinema distribution, but it didnt, no cinema would take it because they knew the model works as a special event but doesnt work as a general release. And the special event screenings are not profitable. Now it was profitable for us because the tour was presented by Harley Davidson and some other sponsors so the expenses were paid. And this is an option in whatever niche the film sits in by all means do a tour... But it can only really be about either vanity, or a hope that a tour on by the film maker will create more hype to sell to on demand or something.

We live crazy times and can have any blockbuster ever made at the click of a button... Is indie film viable? Or should it be treated more as a calling card and proof of talent/concept without ever hoping to recoup costs?

February 19, 2020 at 5:38AM

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Isaac Elliott
Director - Producer
598

Troubling but important questions.

February 20, 2020 at 11:36AM

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Oakley Anderson-Moore
Writer
Director/Shooter/Editor

A few things here:

1) Cinema Is Not Dead, Its Just To Expensive
We have enough data to prove that people actually do prefer to go out, but the price isn't right. The best example of that was MoviePass, $9.99 all you can see in theaters. The issue with MoviePass, was its business model. They paid full price for the tickets, which could be well above $9.99, and they banked on people not using the service.

The exact opposite happened. People ABUSED the service and went all the time, causing the company to go broke. Or on Tuesday nights, when chains like Cinemark have $7 tickets and $5 any size popcorn, people come out. Cinema has a pricing issue.

2) BingeWave's Model
Guilty of self-promotion, but we started BingeWave Cinematic Distribution with the realization there is riches in the niches. The result has been some really profitable screenings with almost nothing spent on marketing.

3) Marketing Is The Difference
The only real difference between a Blockbuster and quality Indie Film is marketing. Give Indie films access to their targeted audience, and they could generate real revenue.

February 21, 2020 at 6:56AM

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