BY LEIGH STUART To an outsider, it would appear as though the Great White North’s entertainment industry is controlled by just a handful of large players. Canada’s CanWest Global (with Goldman Sachs) has acquired Alliance Atlantis’s operations, Bell Globemedia completed its takeover of CHUM’s cable nets and some of its terrestrial channels, and Rogers has swooped in to manage the remaining CHUM assets. But Toronto’s Peace Arch Entertainment has remained a true indie in this sea of consolidation. John Flock, president of Peace Arch, said that with the exception of Lionsgate, his company is the only publicly traded, vertically integrated independent TV and film company in North America. “As we build our brand, being independent is an important part of our identity, and we expect to remain that way for the foreseeable future,” he said. Peace Arch was incorporated in 1981 as Medco Productions, a video production house. In 1985, the company went public on the Vancouver Stock Exchange and changed its name to Vidatron Entertainment Group. In addition to a new moniker, the organization expanded its operations from home entertainment into film and television productions. By 1998, the company was trading on the Toronto Stock Exchange and a year later, the current name of Peace Arch was established. After the millennium, things started to change at the Canadian production company. In January 2003, Gary Howsam’s CPC Communications acquired a controlling interest in the company and moved the head office from the mountains of Vancouver to the skyscrapers of Toronto, CPC’s home. But the prodco retained an office on the West Coast, and opened further operating divisions south of the border, in New York and Los Angeles in May 2004, when John Flock joined the company. By 2005, Peace Arch expanded its focus from producing film and television product to becoming an international distributor via three corporate acquisitions: Canadian DVD distributor Kaboom Entertainment, U.S. theatrical distributor Castle Hill Productions, and most recently, Los Angeles’ Trinity Home Entertainment, which, by adding its titles to Peace Arch’s catalogue, gave the company a direct DVD distribution operation in the States. Former CHUM vp and general manager Kevin Byles and his colleague Victor Rodriguez recently joined Peace Arch to ramp up international sales. This summer, Peace Arch traveled to the big screen, entering the limited theatrical release business. “We see an opportunity for companies like ours to generate revenues from limited releases while creating greater awareness to help drive DVD and television revenues, both domestically and abroad,” Flock said. The first limited Canadian release out of the Peace Arch gate was the Steve Buscemi and Sienna Miller vehicle, Interview (distributed by Sony Classics in the States). Chapter 27, the muchhyped movie that focuses on John Lennon’s death and stars Lindsay Lohan and Jared Leto, is next on deck for worldwide distribution (minus the U.K., where it’s represented by Momentum Pictures). Another feature, Winged Creatures (featuring Dakota Fanning and Kate Beckinsale) will follow in limited release, along with William H. Macy’s next film, The Deal. Flock said his company is open to a wide array of genres. But, he added, “some topics, like women-in-jeopardy or gore-driven horror films, have been played out and are no longer interesting in the marketplace… at least until something clever comes along.” Peach Arch isn’t resting on its laurels for the smaller screen. Historical miniseries The Tudors will debut on co-pro partner CBC this fall, after launching earlier this year on U.S. production partner, Showtime. “We expect to continue building on its success to compete more aggressively in the highend TV market,” Flock said. The company will take the miniseries into the DVD format in Canada this December. The business of bringing titles to the home entertainment market has changed in the past few years given the onslaught of both video-on-demand and smaller, more portable screens. Flock thinks that while the DVD business’ growth has slowed, it still has a lot of life left in it. “We will focus on strengthening our retail relationships… and producing or acquiring desirable content that has a reasonably predictable financial baseline but the potential for breakout success,” he said. Meanwhile, Flock has begun to see incremental revenues from cable and satellite VoD on many of Peace Arch’s titles, and the company is exploring ways of monetizing broadband opportunities. Aggressive content aggregation is key for an independent company to control its own destiny in a new-screens market, especially in Canada. But Canadian indies are facing even more challenges than new rights management issues. With the weakening U.S. dollar and the expansion of tax credit programs in many states, some of Peace Arch’s prodco competitors that rely on thirdparty productions are starting to feel the pinch, and it’s potentially putting these indies at risk. Flock pointed out that Peace Arch has avoided such potential pitfalls by being a vertically integrated company — directly managing all of the business elements and mitigating risks. “Our strategy has been to create a fully integrated production, financing, distribution and international sales company so we are not dependent on outside productions,” he said. Another big change facing Canadian indies is the consolidation of production companies, but Flock has chosen to approach this with a glasshalf-full mentality, particularly when it comes to his distribution business. He thinks it could mean some short-term turmoil for companies without a Canadian base. “This creates opportunities for companies like ours who understand the landscape, know the players, and have long-term relationships,” Flock said. He expects business in Canada to grow, and is not dismissing the possibility of branching into areas outside of North America. “I wouldn’t rule it out, but our near term focus is to expand our direct distribution operations, continue to produce and acquire top quality film and TV content… and to keep building one of the best international sales and licensing teams in the business,” he said. V I D E O • A G E OC T O B E R 2 0 0 7 30 C o m p a n y P r o f i l e Peace Arch Remains Free Of Canadian Consolidation John Flock, president of Peace Arch Entertainment Peace Arch’s Kevin Byles migrated to the company from CHUM. Upcoming theatrical release, The Deal
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