Festival Central

Local production has far outpaced the demand from dominant indie distribs Gussi and Videocine, chocked with their own co-productions and international titles. Meanwhile, exhibs have been building out capacity, spurring Mexico's screen count to nearly 4,000 -- double the size of Brazil's -- and fueling demand for more films.

At least half a dozen distribs have launched in the last year, including Mercamedia, Cosmopolitan (founded by local exhib Lumiere) and Cien Films.

One of the highest-profile new companies is Corazon Films, founded by helmer Fernando Sarinana, film-TV producer Elisa Salinas and Eckehardt Von Damm, who ankled his post as Videocine's head early last year.

Corazon Films will put out around 20 films this year between its own slate -- including Sarinana's "Enemigos intimos" -- and international pickups like "P.S. I Love You" and "My Blueberry Nights." But the company was set up primarily as a vehicle for the four to six films the trio plan to produce every year.

"If you are going to maintain a slate of production, you have to be a distributor as well," Von Damm says.

He observes that slim international prospects for Mexican films means they need to recoup more than 80% of their investments at home. With increasing piracy dimming the DVD window and local webs paying a pittance for film, Mexican producers need to make that money at the local box office -- an inverse of markets like the U.S., where DVD and TV sales outbalance B.O. revenue.

"Producers can't afford to share sales with a distributor," Von Damm says.

That logic is echoed by producers such as Jaime Romandia at Mantarraya, which put out its own "Silent Light," and Sandro Halphen: His Goliat shingle last year launched distrib David, primarily to put out Goliat's own films.

"There weren't any distribution companies that were doing a good job of putting out Mexican movies," Halphen says. "They were the outcasts, something distributors just wanted to get rid of."

David scored a modest hit with "My Mexican Shiva," which is on track to make nearly $1 million, far outgrossing projections Halphen received from other distribs.

Film's success was largely driven by a grass-roots marketing campaign that benefited from aid by Mexico's film institute Imcine, which has stepped up aid to small distribs.

Yet another production shingle-turned-distrib is Canana. It proved domestic arthouse could be done right with the release of the critically acclaimed "El violin."

This year Canana will continue to put out more internationally lauded Mexican films ignored by local distribs, including "Used Parts," "Turtle Family," "The Year of the Nail" and its own production, "Cochochi."

"It's a suicidal business," says Canana head Pablo Cruz. "But we need to try and build an audience for these types of films."