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Even after they discovered that they would not receive full film foundation support to produce their film, director Daniel Sivan and producer Yariv Mozar refused to give up. They believed in the script for "Mofa'a Hahaim Shel Gotel Botel" (Gotel Botel's Life Performance), and they were determined to make the movie. The success of Danny Lerner's independent film, "Frozen Days," produced on a budget of only $25,000, gave them hope.

"I decided to produce this film completely independently, at any cost," Mozar wrote in a letter to the Israel Film Fund a year ago. "Backed by Daniel's enthusiasm and devotion, I am embarking on a difficult path, but in the end we will make this film."

The letter generated meetings with fund officials. There, Mozar explained that the film would be videotaped to curtail expenses, and he thus requested minimal support.

"I asked for seed money to get us off the ground," Mozar explained. "True. It's a risk because it's our first feature film, but we asked the fund to take the dare along with us."

The fund finally granted "Mofa'a Hahaim" $50,000 in support. In comparison, it costs an average of nearly $1 million to produce an Israeli feature film. But Sivan, Mozar and producer Shai Abramov, who joined them later, considered this enough to launch production.

Like other independent producers in Israel and abroad, they believed the joy of creation and their original vision could compensate for the low budget. "Little Miss Sunshine," directed by Jonathan Payton and Valerie Faris, recently proved that an independent film with a limited budget ($8 million, which is not much in U.S. terms) can capture the hearts of critics and filmgoers, earn close to $100 million, win plum awards and grab an Oscar nomination for Best Motion Picture.

In Israel, "Frozen Days" proved that an interesting and refreshing independent film could be produced on a budget as small as $25,000. Lerner's film earned critical acclaim and first prize in the 2005 Haifa Film Festival. It was a candidate for two Israeli Academy Ophir awards, and was even included in the list of 56 foreign films nominated for a Golden Globe.

Camcorders and digital technology have significantly reduced the cost of producing videos, which in turn has utterly simplified production of independent films. Thus, it now appears that the number of locally produced independent films will only increase. However, until now, the local movie industry had viewed digital works as unworthy of serious consideration. Not only are local theaters unequipped to screen them, Israel's two major film festivals, in Jerusalem and Haifa, stipulate that only movies produced on film may participate in their prestigious competitions. But, a year and a half ago, a ray of light penetrated the dusky, celluloid ceiling, and planted a glimmer of hope in the hearts of independent filmmakers, who rely on digital technology.

Lerner insisted on entering "Frozen Days" in one of the two major Israeli film festivals. His repeated overtures to Jerusalem organizers yielded no results, but his stubborn persuasiveness bore fruit in Haifa. After many telephone conversations, Haifa Film Festival artistic director Pnina Blayer agreed to see the film. Blayer was not only impressed, she decided to run the film in the competition in which it finally earned the top prize.

"I believe a taboo was broken here," Blayer says. "We understood that because of new technologies, inflexible criteria might be problematic, and one must occasionally relate to an individual work rather than mere criteria. 'Frozen Days' proved to be a production by a young filmmaker who presented a fresh, young, intelligent and alternative film."

Individual exceptions were made during the last Haifa Film Festival as well, to permit David Volach's videotaped movie "Summer Vacation" to earn its director the "Taglit Hashana" (discovery of the year) award. The film will also appear in New York's Tribeca Film Festival at the end of the month.

Jerusalem, however, still insists on maintaining its criteria. "Our competition highlights films that are screened in movie theaters, and to date, Israeli theaters are only equipped to screen movies on film," explains Jerusalem Film Festival director Avinoam Harpak. A movie shot digitally and later converted to film may be presented. But such conversion may cost as much as $50,000, and many independent filmmakers cannot afford that.

The Israel Film Fund, like the Haifa Film Festival, has adapted to the changing times.

"We understand that given current technology, a young person may purchase a decent camera and editing software for a very small sum of money, enlist friends and make a movie," says fund director Katriel Shehori. "These are typically energetic young people who are anxious to get underway, and we understand that it would be a shame for them to wait for the fund's reading and screening system."

During the last two years, the fund has granted up to $50,000 to independent filmmakers in various stages of production. In addition to "Mofa'a Hahaim Shel Gotel Botel," the fund has granted similar sums to films including "Strangers," by Erez Tadmor and Guy Nattiv; "Sea Salt," by Itai Lev; "Maftir," by David Dzhanashvili; and "The Shelter," by Roy Hornshtein.

"We are young people with a knife between our teeth," say producers Mozar and Abramov. "We and Daniel, the director, relinquished our own salaries, and the rest of the people working with us are here because they love the script. Almost everyone is under 30 and prepared to compromise on work conditions and receive a minimal salary."

Filming was completed last week. It lasted 20 days at 32 locations in less than ideal conditions. The production office was located in Mozar's Tel Aviv apartment. Abramov provided the camera, and locations included the apartments of Abramov, Sivan and leading actor Nati Ornan. Ornan's mother also contributed her apartment.

Independent production suits the film's alternative content, which features a failing musician who leads a marginal band attempting to survive in a commercial industry. He searches for love but finds imperviousness, and in that context, develops a split personality that forces him to cope with his emerging dreary, narcissistic character. The creators of the film describe it as a "disturbed circus of bizarre characters, a celebration of genres that moves freely between reality and imagination. This is a song of praise for the alternative, in its most delusory forms."

Gotel Botel, the real band at the center of the film, is a troupe of musicians and actors led by Nati Ornan that has appeared around the country in cabarets and rock operas. Sivan says the film's score relies on Gotel Botel's original music, thus further reducing the cost of production. When asked about other cost-cutting measures used, Sivan says the script was actually written with an eye to limiting expenses. The film adopts a quasi-documentary style produced by a small, mobile digital camcorder, and the use of minimal lighting also reduced costs.

The digital format not only cuts costs, but facilitates creative freedom and influences the style of the film, Sivan says. "Videotaping not only saves on the price of the film, it lets us shoot a lot of takes, from many angles, because there are no limits imposed by expensive, raw material. We press 'Record' without constantly totaling costs. In a series like 'The Sopranos,' which is also videotaped, there are sometimes 10 camera angles in a single scene. You can go wild. Often, someone who shoots film can't afford to do that."

Creative thinking can also save a lot of money. One scene portrays a building completely flooded by water. Sivan used a montage of Photoshopped photographs. The production also emphasizes locations rather than sets. Rather than building a costly set, filming takes place on site. But Sivan notes, "What really saves money are people who are hungry to create something different and prepared to work under less favorable conditions."

"This is an adventure with tremendous risk," Mozar and Abramov add. "We are investing a great deal of money and many months of our lives. We are working with staff that is not very experienced, and we see this as a once-in-a-lifetime experience. We know we stand little chance of finding a distributor, but we hope to find a distributor with vision who dares to look at the film with different eyes - not merely as a financial decision."