What’s the mood heading into the 25th Sundance Film Festival? Overall, the sense of a across the board scaling back is palpable. Almost no one will talk about their own company’s downsizing publicly, for fear of appearing financially unstable, but it’s no secret that the economic catastrophes have hit everyone’s travel and promotional budgets. Besides fewer sponsored parties – Motorola, for instance, will not be in attendance — the rumor is that some photo agencies have majorly scaled back their coverage, sticking to the red carpet only, and usually ubiquitous publications aren’t sending their film critics. “The party grid is much, much shorter than it has been in the past,” says Jeff Abramson of Gen Art, whose company is nevertheless co-sponsoring several parties with companies like Kenneth Cole and 7 For All Mankind. “There are still tons of actors who don’t even know if they’re going or not,” possibly because producers no longer have the budgets to bring them.

William Malone, President and CEO of the Park City Chamber and Visitor’s Bureau for the last nine years, says that hotel bookings look to be between 6 and 7 percent less than last year. “We’re hearing from catering companies that there’s pullback from the money spent on parties, and that some private spaces, like art galleries, are seeing less interest in rentals for parties or corporate sponsorship.” Malone says that this retrenchment is across the board, and that lodging ranging from expensive properties to value-conscious hotels are all suffering.

But most filmmaker’s anxiety is focused on the possibility of a grim distribution landscape and fewer sales in general. “People are on the defensive,” says Ryan Kampe of Visit Films. Visit is repping three Sundance films for sale — Ry Russo Young’s You Wont Miss Me, David Russo’s The Immaculate Conception of Little Dizzle (pictured left) and Noah Buschel’s The Missing Person (pictured above right). “A lot of industry people without films in the festival, who might have gone in years past, aren’t going.”

Producer Jared Goldman, for instance, whose film Manda Bala won Best Documentary in 2007, doesn’t have a film in the festival this year and still hasn’t decided if he’s going. “Sundance isn’t the only place to take meetings — and L.A. has nicer weather.”

Robert Byington, director of RSO [Registered Sex Offender], who received a Sundance/Annenberg grant for his soon-to-be-completed Harmony & Me, may or may not go. He has been out to Park City four times, but not recently. “Word seems to have gotten out that selling your film isn’t so much a part of the deal anymore, and that’s definitely a change from when I was going in the late ‘90s and early 2000’s,” he says.

“Sundance isn’t the full answer anymore,” says Kampe. “The domestic side starts at Sundance, then we’re positioning ourselves towards Berlin to sell international rights. It’s definitely not a full roster of international buyers [at Sundance this year.]” Indeed, just weeks before the festival one prominent sales agent was circulating an email trying to unload their expensive pre-paid condo.

“I’m fairly sure we’re not going to see any $5 million bids like there were two years ago,” echoes Gary Palmucci at Kino International. Kino released 12 films last year, all but one of them theatrically, and has picked up many films that have played at the festival including Love the Hard Way, Love Comes Lately, Harvard Beats Yale 29-10, Momma’s Man and Old Joy. “People are more conservative. But dozens and dozens and dozens of films are looking for distribution. I’m optimistic that we can find great films that we can afford and get them into the theatres.”

Producer Josh Zeman is bringing Peter Callahan’s Against the Current to the festival, and acknowledges the subdued atmosphere — “I definitely expect it to be quieter, but that’s also exactly what this festival needs. ” Zeman was recently a participant in the Sundance Producers Initiative, and he spent time at the Institute this summer. “This past summer changed my understanding of the organization because now I understand it’s not just a festival. The Institute has goals, and it is trying to foster talent and diversity. It’s tough because in some ways the marketplace by definition subverts those values.”

All agree that the toning down of hype is not necessarily bad for the movies themselves. “It seems the hype outweighed the reality [in years past],” continues Zeman. “I think we lost sight of what these films are really being made for, which is art first, not commerce. Obviously there are better ways to invest your money than independent film, and I think we’re paying the piper now for having set expectation levels too high. This is probably a natural market correction, and hopefully the pendulum will swing back and eventually we’ll find the equilibrium again.”

Producer Jay Van Hoy is bringing Cruz Angeles Don’t Let Me Drown (pictured left), which will premiere in Competition on the first Sunday of the festival. Van Hoy also doesn’t think the lack of hoopla will affect the film. “We’re meeting with all the distributors before we screen the film,” he says, “getting to know one another better. I think all the people we really want to be at the screening will be there, so we’re excited about it. It’s definitely a buyers’ market for everything, including hotels and flights.”

The upsides: flights seem to be cheaper, and there are cut rate hotel rooms still to be found. Less parties in bars means more parties in houses, less DJ’ed events means more conversations where you can actually hear each other, and smaller crowds mean better odds that you can get into the films you want to see. “I remember distinctly when I realized people were coming to Sundance just for the parties,” says Abramson, who has been going for 14 years. “And that was the year Paris Hilton came for the first time. Since then it’s just gotten more and more crazy, and it’s nice that it’s retracting to how it was a few years ago. They used to give out buttons that said ‘Focus on Film’ — maybe everyone will do that.”