Written by Ariston Anderson

The Internet may have killed the music industry, but a handful of companies are stepping in to guarantee that the same fate doesn’t befall the film industry. It’s a simple formula: offer top quality streaming for free or low cost with minimal advertising and the experience is much more pleasurable than pirating.

Theatrical film distribution has never been tougher, as witnessed by the shutdown of a number of independent studios last year: New Line folded into Warner Brothers while Paramount Vantage folded into big Paramount; meanwhile Picturehouse and Warner Independent Pictures completely shut down.

And as more and more indy film distributions companies close, it looks like the Internet is becoming more and more the source for Indy distribution.

“For an independent filmmaker, this can mean an effective way of keeping distribution costs low, which have traditionally been one of the unspoken hurdles in getting to your audience. Plus, you have the ability to get your work in front of more eyeballs than any limited theatrical release could ever accomplish,” says Matt Dentler, head of programming at Cinetic Rights Management, a company founded to represent film sales for digital media.

“I’ve been at Cinetic for precisely one year now,” Dentler tells WalletPop, “and the broadband VOD space has developed dramatically in that time. Hulu is now a major force in streaming, Amazon re-launched its online VOD platform to great success, and Netflix streaming is now available through Roku and Xbox. This is one segment of film distribution that grows more and more every single day. The same can’t be said for other, older forms of distribution in 2009.

“We’re still working to figure out the best model, and I think it’s going to take a little more time to see where consumers migrate the most. But, yes, the advent of cable VOD, iTunes Movie Store, broadband streaming, are making the idea of “digital distribution” more than a novelty. It will one day become the norm.”

While Hulu has recently scored another a granddaddy of a deal with Disney, in additon to NBC and FOX, it’s not the only site out there for film. Bookmark these sites and start discovering a wealth of new films daily.

If you love documentaries, head over to SnagFilms, which specializes in anything from rock legends to politics to sports. All of the films are free to watch, and you can even snag them to place elsewhere on the Web.

The Auteurs is for the film junkie who is looking for more of a cinematic community than Facebook has to offer. Follow friends to find out what they’re watching, and then download your own films, straight from the festivals. Some films are free, while others are available for a $5 download.

Like the name suggests, Babelgum specializes in cinema from around the world. So if your curiosity has gotten the better of you, head over to Babelgum and start browsing free films. The site even hosts an online film festival, complete with a full jury which gives out more than $125,000 in cash prizes.

Joost has an amazing selection of films: global, independent, documentaries, comedies and more. And if you’re frequently found browsing the Classics section for Cary Grant, Shirley Temple, or Charlie Chaplin, Joost is the site for you.

And yet another reason to support public TV, we love the offerings of Thirteen’s Reel 13. We first discovered the amazing animated film Sita Sings the Blues, as one of their weekly features. And you can pe into their vault of amazing classics from anything from Moonstruck to Inherit the Wind. All free.

Crackle, a Sony Pictures Entertainment company, has a huge free library of recent and classic blockbuster films. It’s enough to make me cancel my Netflix subscription.

And don’t forget about YouTube of course, which is no longer just for music videos and webisodes. YouTube Movies has increasingly been adding more and more feature length films in the platform we’ve come to expect from YouTube: easy to find films presented in a user-friendly format. Be sure to check out the Tribeca Screening Room which features shorts and features from the recent festival, with new films added every two weeks.

If you’re looking for an all-inclusive film streaming search engine out there, head to SurftheChannel and search through their film section to find your favorites. The site, which doesn’t stream any content, compiles the best links from around the web into one site.

And a new site, Jinni, purports to be the Pandora for film. It’s a new search engine powered by their Movie Genome, that characterizes films not just by key words, but by plot elements, atmosphere, emotions, and more, allowing options for movies you can stream instantly. If you’re overwhelmed with all of your new options out there on the web, type in a few of your favorites, and let Jinni do the work and pull up some fresh suggestions.

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