To Spec Or Not To Spec: New Realities May Mean More Opportunities For Writers

By Aimee Manis, Studio System News

The term "spec," or "speculative," refers to an original screenplay written without compensation to the writer. Like any capital investment, the writer invests their time (along with blood, sweat and, often, tears) into the spec with the hope of selling it to a studio, producer or production company and seeing a financial and professional return on that investment.

Whether you're an established screenwriter - or aspire to be one - you've probably heard doom-and-gloom reports of today's spec market and wondered if writing a spec is even worth your effort. Here's a look at the current state of affairs, how to adapt to it, and why writing a spec is always worthwhile.

THE VALUE OF SPEC SCRIPTS
All unknown writers who try to break into the industry need to have several excellent writing samples in their portfolio. Even if the spec doesn't sell, it has the potential to introduce a new writer and to launch a writing career through other assignments. Agents and managers read a spec not only to judge its inherent talent and marketability but to gauge the writer as a potential client. Even if the material isn't a fit for them, great writing can open doors.

Even when spec sales are sluggish, there is still a need for the flow of fresh, original material and filmmakers will always be looking for visionary storytellers and the next great script. Adam Kolbrenner, manager-producer with Madhouse Entertainment, advises: "As long as a writer has a great idea for a movie, and writes that story well with an exceptional voice, the demand for specs is always high. Strive for incredible characters, original story ideas, ideas that are well-told, and let the universe decide on the great scripts."

RIDING THE SPEC CYCLE
Entire books have been devoted to the history of the spec, and it's rise and fall, but here's a short version of the phenomenon and where it stands today.

In the late 1940's, film studios phased out the full-time employment of screenwriters to cut costs and, for the first time, screenwriters had to function as independent contractors. This change led to the rise of the spec sales era of which a high water mark was the 1967 sale of William Goldman's original screenplay Butch Cassidy and the Sundance Kid. That script was sold for a then-record $400,000 to Warner Bros. in a bidding war.

In the mid-1980's, the spec market became a headline-making force thanks to the success of Lethal Weapon, Highlander and several other big-ticket sales. That force became frenzied by the early 90's, driven by a gold-rush mentality that saw spec price tags soar into the seven figures. For example,1992 saw the $3 million sales of both Basic Instinct, written by Joe Eszterhas (City Hall, Big Shots)and Medicine Man, written by Tom Schulman (Dead Poet's Society), and 1996 saw the $4 million sale of The Long Kiss Goodnight, written by Shane Black (Lethal Weapon, The Last Boy Scout)

Alas, no frenzy lasts. By 2003, the spec bubble had burst. Annual spec sales dropped from an average of 136 down to an average of 76 per year from 2003 to 2010.

As discussed earlier in this series, the writer's strike of 2007-2008 gave the studios plenty of time to review the arsenal of scripts they'd been hoarding instead of investing money into new material. The end of the strike was welcomed by a new world in which studios were no longer development machines but where most movie ideas were culled found from books, toys, video games and the like; the era of developing original content seemed finished.

Although experts like Jason Scoggins, founder of The Scoggins Report and SpecScout, don't foresee the return of seven-figure sales, the spec market has leveled out in recent years.  During the same period from January to May, 44 specs were sold in both 2009 and 2013, in 2010 only 35 specs were sold, in 2011 47 specs were sold, and in 2012 the spec market hit a high of 63 specs sold within that period. According to the Scoggins Report on Spec Scout, the May 20 Spec Market Scorecard shows a 30% drop in spec script sales this year over the same period last year; that's 44 sales this year against 63 in 2012. Rightly so, there has been less material offered for sale this year than in 2012.

Taking a closer look at the facts behind the figures reveals the reason behind this market stagnation: It's not the major studios that are driving this marketplace. Says Scoggins, "So far, 2013's spec market has been sustained by non-studio buyers," and the data shows that Fox and Universal are the only studios buying anywhere close to the rate of previous years.

For a bit of perspective, consider that Universal bought 9 specs in 2012. yet it's recent purchase of the dark comedy Little Evil by Eli Craig is only its second buy this year. Making the point crystal-clear is a chart within the May 2013 Spec Market Scorecard that illustrates the buying trends by the Big Six between 2011 and 2013 when, as Scoggins points out: "Major studios cut their spending by roughly 45%." The trend is troubling for the current spec writer but more so is the question of its effect on the future of original storytelling.

If the drop in the amount of material for sale is a barometer of the screenwriting climate, one has to wonder whether the lack of studio support is causing writers to lose faith in the spec system. Among several screenwriters interviewed, the general attitude is that selling a spec to a studio has become virtually impossible. One veteran film screenwriter admits: "I haven't gone out with a spec in years. I think it's a losing battle. It's become clear that the studios are only looking for brands. Most are just pilfering their own catalog of movies to reboot."

The glass-half-full theorists would argue that the entertainment business is inherently cyclical and that, in time, the spec market will correct itself. Either that or the studios will simply run out of big titles to remake and will have to fill their development pipeline with original scripts again. As one screenwriter puts it, "Eventually, the studios will either (A) run out of known brands and start pumping out lesser known brands, which leads to (B) the audience becoming tired of branded movies."

INDEPENDENTS OFFER A SILVER LINING
Fortunately, studios aren't the only game in town. A buyer is anyone with access to production financing, and the number of independent finance/production or finance/distribution companies who shop the spec market is significant and increasing each year. According to Scoggins, while it's become exceptionally difficult to sell a spec to a studio, a "silver lining" can be found in the rise of non-studio buyers. He believes independents represent a great opportunity for writers, and his research shows that the range of material being purchased by non-studio buyers is much wider than what was considered by the studios.

Compared to a studio, an independent company invests in fewer scripts, giving them a far better ratio of purchase-to-production than the studios can claim. Says one veteran screenwriter, "Selling a spec to an independent company may give the writer a real shot at seeing their project come to fruition rather than watching it languish in development hell at a studio." Regarding purchase or option prices, he adds, "The amount of money upfront may not be as big [as what a studio would pay], but if the film gets made, the production bonus may make up for the difference."

COMMERCIALISM CONTINUES TO REIGN
In the quest for the next breakthrough story, writers are creating characters and worlds in innovative ways and seeking a voice as unique and distinctive as a fingerprint. Yet, the economics of film production dictate that the finished product must be viewed through the lens of commerce—an inescapable fact of the business of Hollywood. The effect of high-value intellectual property—think powerhouse series like Harry Potter, The Hunger Games and Twilight—on the way Hollywood does business is profound. The choice between producing another installment of The Lord of the Rings and rolling the dice on an original script is a no-brainer for a major studio.

Franklin Leonard, founder of The Black List, believes that the industry needs to do a better job at blending the creative and the commercial, that is, letting scripts tell a human story, then adding certain elements, like action sequences and set pieces, to make it commercial. He adds, "Historically, writers have been the most undervalued part of the business, but they now stand to benefit from the economic shift. There is and will be growing recognition of the writers and writer-directors who are the key to great storytelling." Meanwhile, as the next generation of writers waits for both audiences and studios to sour on sequels, they should be developing specs designed to be both original and commercial.

KNOWLEDGE IS POWER
Ignorance may be bliss, but it's no longer an option for screenwriters, who have access to more industry information than ever before thanks to resources such as The Scoggins Report on Spec Scout and The Black List. Researching development trends can give writers insight into how marketable (or not) their scripts are in the evolving climate; the data can revewal what specs have sold, who bought them, which genres are hot and what types of projects are being made by studios versus independents. Before they even begin writing a script, writers can get a grasp on the spec marketplace and which buyers are the right targets for their material. For those writers who subscribe to the write-what-they're-buying theory of spec success, there's no such thing as too much information.

So what genres are hot for spec sales? Thrillers topped the charts in 2011 and 2012, accounting for over 25% of sales, with comedies placing second in 2011 and tying with action-adventures for second place in 2012 at around 21% of sales. Drama is the current underdog, with a sales share below 10%.

A word of warning: Writers must know the market, but being beholden to the facts and figures can also crush creativity. When a writer is clearly aiming for what buyers want, rather than following their own passion, the results can be emotionally hollow and mechanical. Similarly, writers who rigidly stick to formula or who try to force their vision to fit the template of a particular genre are doing a disservice to the story and to themselves.

THE SKY'S THE LIMIT
The script services offered by SpecScout and The Black List have broken down some of the long-standing barriers to entry for aspiring screenwriters. Writers without connections in the industry, without an agent or manager or who live outside L.A. or New York have no excuse to sideline themselves now that these resources can get specs in front of the right people. Unknown writers are being discovered through these services and being signed by agents and managers.

Writers from all over the world can now find an audience for their work. According to The Black List, screenplays have been uploaded to the paid service from 34 countries and from all 50 states. The Black List recently announced its first international sale, the spec script Broken Cove by Irish writer Declan O'Dwyer.

AS PLAYERS DIVERSIFY, EVERY SPEC HAS A SHOT
While no one is claiming it's easy to sell a spec—not by a long shot—it's being done month after month. There will be writers who deplore the dismal state of the entertainment industry, attributing their lack of success on the economic shifts in the industry, and there will be those who adapt to the New Hollywood, using all of the resources, tools and technology available to them to stack the odds in their favor. Take a piece of advice from Jason Scoggins: "Ignore the short-term numbers and keep writing specs." No matter the ever-shifting fortunes of the Big Six, the widening diversity in financing, production and distribution options seen now with the rise of independent and Internet players means there will always be potential for talented spec writers to find success.