BROOKE GLADSTONE: With every technological advance, old media get new makeovers or face extinction. Tech mavericks Mark Cuban and Todd Wagner capitalized on this concept, and together were one of the biggest success stories of the internet boom. They created Broadcast.com which streamed radio and TV before most people had high speed connections, and then sold it to Yahoo for 5.7 billion dollars. Now they're tackling another medium, film, in high definition. Catherine Cuellar of KERA in Dallas has more.
CATHERINE CUELLAR: It's pretty much accepted fact that films open at a local megaplex, then over a period of months make their way to DVD and video and ultimately, cable. But Dallas entrepreneur Todd Wagner wants to change that.
TODD WAGNER: People that want to go to the theater -- we want them to go to the theater. But you know what? If you don't want to go, you've got 3 kids at home, you can't get out that night, you can't get a sitter, I want you to be able to have the movie on DVD as well -- at the same time!
CATHERINE CUELLAR: Wagner's business partner, Mark Cuban, created HD Net, a satellite and cable TV channel exclusively for high definition programs. There are other digital distributors out there, such as dot coms Netflix and The Film Movement. What makes Wagner and Cuban different is they're not only distributing movies, they're making and showing them. Todd Wagner.
TODD WAGNER: If I'd have said to you a year ago, yeah, we're going to make movies and, you know, maybe we'll put them on HD Net, but maybe we'll put 'em in the theater at the same time - people were like, well that's nice -how you going to come into the theaters to do that? They're always going to say we need to run it first. Well, looks like we need to own some theaters, then, doesn't it?
CATHERINE CUELLAR: So, late last year Wagner and Cuban bought Landmark Theaters, the nation's largest art house chain. They've also created a new company, HD Net Films, to make high-def movies for less than 2 million dollars a pop. Their media company, 2929 Entertainment, also includes film and TV production, indy distributor Magnolia Pictures, and Rysher Entertainment's TV and film library. This farm to market integration makes New York Times film critic Elvis Mitchell a little nervous.
ELVIS MITCHELL: It's what the Justice Department did away with by divesting the studios of their theater chains in the 1940s. I, I would like to think that somehow it means that it'll be great for filmmakers who can sort of get the attention of these guys and get them to go along with what you want to do, but these guys have setups, can end up being coercive, and can end up being a real threat to independent filmmaking.
CATHERINE CUELLAR: By law, Wagner and Cuban's venture cannot just show its own movies in their Landmark Theaters, and Mark Butan, the newly-announced head of 2929 Productions, says his bosses are not building a monopoly.
MARK BUTAN: I think the main difference is, you know, 50, 60, 70 years ago, whenever those laws were originally passed, the only real outlet for a person to screen a motion picture was in a theater, and so if the producers controlled the theaters, there was like no al--alternative. They needed to get the picture out there. But today, you know, with DVD and video and cable television and pay per view and everything else, there's, there's more avenues of distribution than one person can possibly control.
CATHERINE CUELLAR: But the company controls Landmark's 204 screens across the country. It's a drop in the bucket by Hollywood standards, where major releases can open on as many as 3500 screens, but those Landmark screens mean a lot to independents trying to show their work. Bart Weiss is board president of the Association of Independent Video and Filmmakers. He's concerned about vertical integration in the industry but hopes Wagner and Cuban will be different.
BART WEISS: If this were mainstream Hollywood, you know, things with star vehicles and all of that, you know, then there's some issues, but if, if this is an opportunity instead of being exclusive, but would include pieces that could come to the table that otherwise were outside of the mainstream - otherwise wouldn't get any - be seen at all - and that they could get assistance to be produced, and then to be distributed and then to be exhibited, that could be a really good thing. So there's a great potential here.
CATHERINE CUELLAR: And independent filmmakers like Rodney Lee Conover, are excited about it. His high-def film, Bachelorman, has won 14 festival awards since April.
RODNEY LEE CONOVER: They're still going to have to make good movies, and acquire good movies and use fresh writing, directing and acting talent. If they don't, it'll be the opportunity for someone else to spring up with a brand new idea in distribution and, and beat 'em at their own game.
CATHERINE CUELLAR: So, with tech savvy, deep pockets and business knowhow, Cuban and Wagner aren't waiting to be beaten. Their creative team is working the festival circuit and ready for the pitch. For On the Media, I'm Catherine Cuellar in Dallas.