Here’s a cool idea that seems to be a step in the right direction for movies and digital downloads. The Sundance Film Festival is going on right now in Park City, Utah, and in addition to all of the feature length films that are in competition, they also showcase a large number of short films. Shorts often get overlooked at festivals, but The Sundance Institute and Sundance Channel have made an interesting deal that will bring some attention to them. As of Friday, January 18th, there are 45 short films available for download on Xbox Live Marketplace at the low price of 160 Microsoft Points ($1.99). They will also be available on iTunes for the same price, and through Netflix via the “Instant Watching” feature. (These are permanent downloads, not rentals.)

While I can’t see many people taking a risk on a short film they haven’t heard of before, it still seems like a great opportunity for the directors of short films to make a little money from their productions. It might be even better if they allowed a package deal of sorts, although they claim there are currently no plans for such a thing. Will we ever see feature length independent films offered through deals like this? I suppose as long as a movie has a shot at theatrical distribution and a decent DVD release, they’ll probably go that route, but it’s nice to know that more and more options are opening up to filmmakers nowadays. You can check out the complete list of short films over at Joystiq, and also watch a few of them for free over on the Sundance website. (Thanks to Chian for the heads up on this story.)

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