By Dom Serafini

The recently concluded American Film Market (AFM) started with an historical event on November 5, the election of the first black American president, and ended on November 12 with another historical event — at least for the 29 year old market — a decline on all fronts: fewer buyers, fewer exhibitors and fewer participants.

Indeed the corridors were mostly deserted at the Loews Hotel in Santa Monica, California, whose suites were turned into sales offices for the AFM. However, Jonathan Wolf, managing director of the AFM, explained that all was perfectly cool. “I’m worried when I see crowded halls because it indicates that [buyers] are not at the screening places,” he said, adding that one of AFM’s greatest features is the high number of world premieres (102 films) it offers since “buyers are always looking for new product [to screen].”

This AFM made perfectly clear that it is primarily a DVD market, and a few buyers, such as Mario Pimentel of Portugal’s MPA, actually skipped MIPCOM this year for that reason. It was this DVD sales potential that that brought a number of exhibitors to the AFM for the first time, as well. Said Andrew Schreiber of U.K.’s Power: “ We’re here for the first time to expand our presence in the DVD market.” Another first-timer was Jill Keenleyside of Canada’s CCI, who reported brisk sales for Alice Upside Down, with an all-rights deal concluded in the U.K., and with negotiations conducted with Germany, Latin America and the Middle East.

Another AFM characteristic is the opportunity for pre-sale agreements that filmmakers give to banks as guarantees to secure production money.

Nonetheless, the close proximity of the powerful Cannes-based MIPCOM with the Santa Monica event aggravated by the sad state of the world’s finances, had a negative effect on sales at the AFM for many exhibitors.

Ironically, the bad state of the world economy, which was a recurrent theme at AFM seminars and in the corridors, is proving a boon for DVD rentals. Blockbuster has already recorded an increase in rentals and it has projected further gains in the coming months.

But more than the poor economy, on the mind of many sellers was the problem of too many movies chasing too few dollars. The glut of completed movies seemed to be the real economy at the AFM even though some disagreed. “Each territory has its own preference,” commented one distributor. “There are countries that prefer action and horror and others that favor romantic comedies. The quality might vary, however.” In any case, help is on the way. At one of the many AFM conferences, it was pointed out that the credit crisis will result in fewer movies being produced — at least for the next five years.

Also facing the indies are issues such as companies’ stock prices going down, the credit crunch, the critical financial status of countries like Iceland, the threat of a Screen Actors Guild strike, budget cuts, and the end-of-year budget cycle. The latter is a recurrent end-of the-year syndrome, when acquisition executives run out of money and go to the AFM to shop instead of buy. An acquisition boost is expected at the beginning of 2009, but then it would be NATPE (late January in Las Vegas), the Berlin Film Festival (in Germany in mid-February) and MIP-TV (in Cannes, late March) that would benefit.

According to ACI’s George Shamieh, buyers dried up their budgets three months prior the AFM. However, Chevonne O’Shaughnessy added that at the AFM, ACI completed sales of its miniseries Jack Hunter to TV Azteca, CineCanal, Channel 12 Uruguay and RCTV. And for the company’s success in Latin America, she credited VideoAge.

Similarly, it was said that the improving dollar exchange rate is favoring non-U.S. distributors’ sales and making locations outside the U.S. more appealing to American producers. At the same time however, the dollar gain “burned” up what was left in non- U.S. buyers’ budgets.

As for the buying contingent, according to market organizers, a good number were recorded from Asia, especially Japan. A total of 1,527 buyers representing 65 countries were in attendance, 100 fewer than last year.

Overall attendance at the AFM was 7,903, a 5.3 percent decrease from 2007. A total of 409 companies from 36 countries exhibited at the AFM, a two percent reduction from last year. Additionally, 527 films in 35 languages were screened during the AFM.