Major studios seeing the potential of Web video

Web sites that buy original video clips often pay so little that ‘‘The Bannen Way,’’ a flashy crime thriller making its debut online, looked destined to be made poorly, if it could be made at all.

Yet the budding filmmakers Jesse Warren and Mark Gantt managed to hire about 40 employees, including a boom operator, camera people — yes, more than one—and even assistants to offer sunscreen and sandwiches. And the production had actors familiar to some television and movie audiences, like Michael Ironside, Robert Forster and Vanessa Marcil.

The secret to their success? Treat the Internet run like a television ormovie release, which often loses money on its onscreen debut but can make healthy profits from sales of DVDs or Blu-ray discs and in reruns on cable or outside of the United States.

With that in mind, major movie studios are getting behind such productions, giving them a lift in budgets and quality — in contrast with the shaky camerawork and dubious special effects prevalent when Web video became a new phenomenon a few years ago.

For Mr. Warren and Mr. Gantt, who finished shooting in October, a snazzy trailer they produced helped snag Sony Pictures Television as a partner.

Mr.Warren, 31, said he and Mr. Gantt, 40, had decided to design the series as a feature-length film because ‘‘there’s no limit to howmany episodes there can be in aWeb series.’’ That way it could eventually be sold as a DVD.

Sony executives, it turns out, had the same idea.

The studio picked up the project in April and gave it a budget of about $1 million.

That is nowhere near the $30 million- plus budgets of many Hollywood movies, but more than the producers had been told they could sell it for. Web sites typically pay as much as $5,000 for a short clip of original video; with 16 episodes, other Web sites might have paid about $100,000 for ‘‘The Bannen Way.’’ ‘‘This money buys more lights and more production value,’’ Mr. Gantt said.

Mr. Warren appeared to bask in the luxury of a full crew: ‘‘We can afford extras rather than having our friends come in.’’ One quirk of the Web is that each episode must have a cliffhanger to keep online viewers coming back.

‘‘It moves pretty well,’’ Mr. Warren said, snapping his fingers. ‘‘We had breaks that would naturally lend itself to the Web.’’ Sony Pictures Television hopes the release will gain attention and a few advertising dollars when it begins to appear in January on the Sony-owned Crackle.com, a site aimed at males aged 18 to 34.

Then, it will stop running free online and will get repackaged for sale to TV outlets, on iTunes and elsewhere.

Although the main goal is to drive traffic to Crackle.com, which Sony acquired for nearly $60 million in 2006, when it was called Grouper, made-for- Web productions are expected to make a profit by themselves.

Thus, studios scrutinize projects before approving them and committing financing — green-lighting in industry parlance. In this case, studio input during the production was part of the process.

‘‘We go through a very similar greenlight process as we would for any piece of content in the studio,’’ said Eric Berger, senior vice president of digital networks for Sony Pictures Television, which is planning to make 15 Web productions annually. ‘‘How and why we make them and where we will make money is conceived with every project.’’ Paramount Pictures’s digital arm is also backing made-for-Web productions that canmake additional money in other formats.

Paramount spent $1 million to $3 million making a horror movie, ‘‘Circle of Ei8ht,’’ which began showing on MySpace in installments in October for an initial run through Dec. 8. The series generated nearly five million views online — which would rank it among the most-watched shows if it were on U.S.

cable television.

To help pay for production, Paramount, owned by Viacom, lined up a product-integration deal with PepsiCo’s Mountain Dew brand and sold exclusive rental and on-demand rights for one month to Blockbuster. MySpace, which is owned by News Corp., gave marketing support.

‘‘I don’t think there’s been a more expensive piece of content made for the Web,’’ said Thomas Lesinski, president of Paramount Digital Entertainment, which has two other Web projects in the works.

He added that hiring professional talent and crew and paying for an original score would help sell ‘‘Circle of Ei8ht’’ when it moved to other platforms. ‘‘The stuff that we’re creating could easily play on television,’’ he said.

Brady Brim-DeForest, the co-founder of the research and news site Tubefilter.

tv, calls the renewed activity ‘‘the second coming of original programming online.’’ He cited the recent success of ‘‘Dr.

Horrible’s Sing-Along Blog,’’ made by Joss Whedon, the creator of the cult hit ‘‘Buffy the Vampire Slayer,’’ during the writers’ strike last year.

He estimates ‘‘Dr. Horrible’’ cost $220,000 to make but brought in about $2.4 million within a year, after sharing ad revenue on Hulu.com and selling the movie and soundtrack on iTunes, and sales of DVDs and merchandise.

Internet shows have also made the transition to television. After a one-episode flirtation on NBC, ‘‘quarterlife’’ found a home last year on Bravo, a network owned by NBC Universal. The Scifi Web series ‘‘Sanctuary’’ made it on Syfy, and ‘‘Secret Girlfriend’’ ran on Comedy Central last autumn.

Yet for every Web series that is made with a modest budget and high-profile directors, there are about 20 made independently on a shoestring, Mr. Brim- DeForest said.

‘‘What’s so spectacular is they are all drawing an audience, finding a niche,’’ he said. ‘‘That’s the power of the Internet as a distribution medium. It’s very compelling.’’ In October, Vuguru, a Web production start-up created by Michael Eisner, a former chairman of Walt Disney, made several sales internationally. Its ‘‘Prom Queen’’ hit from2007 was translated, recast and reshot for the Web in Japan. A dubbed version ran on cable TV in France and it ran as-is on Yahoo’s Australian site.

Andy Redman, chief operating officer of The Tornante Co., which owns a majority of Vuguru, compared the growth of the new platform with that of cable television in the 1980s.

‘‘It was the platform to be joked about,’’ he said. ‘‘Five years later, they’ve realized this whole new medium passed me by.’’

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