I tried to find entries about this phenomenon, but the search function turned up nil.
My interest in the fan film phenomenon started with the Finnish film "Star Wreck, in the Pirkinning" , a Finnish fan film product produced by five friends in the apartment of one of them. Thanks to the enthusiasm of the contributors and the CGI skills of the makers this was quite an amusing scifi spoof (available for free on the Net) despite its obvious shortcomings.
The makers of Star Wreck profited from the success of their on-line release to obtain crowd-funding for their next release, a professional comedy about Nazis on the Moon, Iron Sky http://www.imdb.com/title/tt1034314/?ref_=nv_sr_1.
If you haven't seen it and you like ridiculous humour, this is a title to watch (I hope Lightwizard reads this).
Now the fan film concept is very alive and pretty good products are coming out of it, like Project London http://www.imdb.com/title/tt1813569/?ref_=fn_al_tt_1,
but the film I am waiting for is the sequel to Iron Sky, Iron Sky the coming race http://www.imdb.com/title/tt3038708/?ref_=nv_sr_2.
They had a funding drive in which contributors could buy a role as extras in the movie. Too bad all spots were taken, for I would have offered quite a bundle for the privilege to be eaten on-screen by a dinosaur! (I mean, come on, who does not dream of that!?)
In my humble opinion, these films, by the sheer enthusiasm of their makers often surpass the dreary products of such production companies as the Asylum... What say you?