Bigger Picture Research

UK feature film production, box office and admissions in 2010

In keeping to its research publication schedule, the UK Film Council has published summary statistics for film production and box office returns over the last year, while the Cinema Exhibitors Association has also released annual admissions figures.

The UKFC press release can be found here, and though I won’t repeat the full detail the headline numbers are as follows (you can click to enlarge any of the charts below):

 

• 119 feature films with budgets over £500,000 began principal photography in the UK during 2010, down from 144 in 2009.
• There were fewer inward investments features in 2010 than the previous year (28 compared with 35), and the number of domestic features and co-productions also fell (to 72 and 19 respectively) (see Figure 1):

Figure 1: Number of UK feature film productions, 2003 to 2010

Source: UK Film Council

• The relative proportions of features comprising inward investment, domestic and co-productions have remained remarkably consistent over the last few years (as Figure 2 demonstrates), with domestic features constituting six out of every ten films made in the UK.

Figure 2: Number of UK feature film productions by type, as a percentage of the total

Source: UK Film Council

• These 119 productions had a combined UK spend of £1.155bn, up from £1.071bn in 2009.
• The growth was driven by another rise in inward investment activity, while the total spend on domestic features fell from £224.4m in 2009 to £174.1m in 2010 (see Figure 3).
• For the first time since 2006, the total spend on co-productions rose, albeit from a historic low of £35.9m in 2009 to £52.0m in 2010.

Figure 3: UK spend on UK feature films (£bn), 2003 to 2010

Source: UK Film Council

• The dominance of inward investment feature spend within the UK total is illustrated in Figure 4, and 2010 saw the highest proportion of spend attributable to this category since comparable records began in 2003.

Figure 4: UK spend on UK feature film productions by type, as a percentage of the total

Source: UK Film Council

On to box office numbers, which held their own in 2010, rising 2% to £1.076 billion for the UK and Republic of Ireland. British films’ market share stood at 22.6%, including 5.5% contributed by independent British films, up from 2009's market share of 16.7% (when indie films, including Slumdog Millionaire, contributed 8.2%, a fact not mentioned in the press release).

Among other details, the press release includes the fact that 28 3D titles were released in 2010, grossing £237.4 million (a 24% market share, up from 16% in 2009).

The premium charged for 3D tickets, and ticket inflation more generally, explains why box office rose in 2010, for in truth admissions were down (although we can only compare tickets sold in the UK, as opposed to the territory total for UK and Republic of Ireland used to measure box office gross). In 2010, there were 169,249,839 admissions to UK cinemas, down 2.5% on 2009 (Figure 5).

Figure 5: Annual UK cinema admissions, 2002 to 2010

Source: CAA/Rentrak EDI/CEA

UK cinema admissions and UK feature production activity, Q1 2010

Volcanic hyperemesis and bureaucratic incompetence conspired to keep me and the family in Portugal for a week longer than planned, hence the lack of recent posts. But at least we enjoyed a few more days at arm’s length from election campaigning (more of which later).

Looking across various news feeds, trade publications and assorted correspondence I see it’s been quite a fecund period for the type of research of interest here. I won’t attempt to cover it all in a single post, so expect a burst of activity over the next week as I work through the backlog.

To ease back into the swing of things, let’s begin with a UK-themed update on first quarter activity.

First off, cinema admissions. Last week, cinema advertising firm Pearl and Dean (P&D) was finally sold off for £1 after four years on the market. Regular readers will recall P&D forms one half of the Cinema Advertising Association (along with Digital Cinema Media), the trade association whose charitable work includes releasing monthly admissions data compiled by Nielsen EDI/Rentrak. Here’s hoping P&D’s new owners continue in this same vein in future.

In the meantime, the CAA has released admissions numbers for March, allowing us to gauge the strength of the UK theatrical market during the first quarter of the year. It’s a positive picture, with a total of 14,482,606 tickets shifted in March- the strongest performance for the month in recent memory.

This brings the total for the first three months of the year to 43,957,027, up 6% on the same period in 2009, and the highest figure since 2002 (Figure 1). Clearly the big screen continues to work its magic on audiences.

Figure 1: UK cinema admissions, Q1 (January to March) 2002 to 2010

Source: CAA/ Rentrak

Turning to UK feature production, the UK Film Council has released the latest data from its regular tracking work, covering the first three months of the year. 23 feature films with budgets of £500k or more started principal photography in the UK during this period, the lowest number since 2005 (Table 1).

Source: UK Film Council

The number of UK domestic features (those made by a UK production company and produced wholly or partly in the UK) and inward investment features (those that are ‘substantially financed and controlled from outside the UK, where the production is attracted to the UK because of script requirements, the UK’s infrastructure or UK tax incentives’) both fell from the level seen in 2009. On the positive side, the decline in UK co-production activity appears to have stabilised, for the time being at least.

The money spent in the UK on making these features stood at £426.5 million, which is considerably lower than the amount spent in 2009 (£485.1 million), but remains higher than the levels of previous years (Table 2).

Source: UK Film Council

Honouring their commitment to provide market intelligence specifically about UK independent films, the UK Film Council reports 2010 saw less activity than in recent years (Table 3), although this is ‘principally due to the decline in co-productions’.

Source: UK Film Council

Interestingly, the median budget of UK independent films (£3.0 million) was higher during the first quarter of 2010 than it has been for some time (between 2007 and 2009 the figure hovered around £1.9 million). This is due to the fact that four of the 18 UK indie features had budgets over £5 million.

The report ends with a projection of full year production activity based on Q1 results. The UK Film Council tentatively suggests the year could see UK production spend hit £907 million in 2010, making it ‘one of the better years on record’.

Given the hefty contribution of inward investment activity to this total, much will depend on the continued attractiveness of the UK as a production base for US studio productions; and the outcome of the general election may prove influential. If we're to believe the pundits, a hung Parliament may further weaken the pound on the international currency markets, and a stronger dollar makes the UK more attractive for inward investment features.

While on the subject of the election, Labour is the only party to mention film explicitly in their manifesto. ‘The strength of Britain’s film industry’, we’re told, ‘is a source of pride'. Labour has committed to maintain the film tax credit and to proceed with the BFI/ UK Film Council merger. In other words, business as we've come to expect it, except of course there’ll be a lot less public money available for film over the next Parliament.

Meanwhile, neither the Liberal Democrats nor the Conservatives mention film in their manifestos, which is hardly surprising given all the urgent matters of State requiring attention (in which context, Labour’s manifesto reference is all the more remarkable).

The Liberal Democrats talk of safeguarding the future of ‘Britain’s creative industries’ by ‘supporting upgrades to our digital infrastructure and taking action to tackle illegal file-sharing’, and of fostering ‘an environment in which all forms of creativity are able to flourish’. This will be principally by means of a Creative Enterprise Fund offering ‘training, mentoring and small grants or loans to help creative businesses get off the ground’. But past evidence suggests getting creative businesses off the ground is rarely a problem- it's keeping them afloat and thriving that proves challenging.

The Conservative manifesto makes only glancing reference to ‘arts and heritage’, but not film per se. This is disappointing, especially given publication late last year of Maud Mansfield’s ‘Report on the British Film Industry for Shadow DCMS’. It's a rather admirable document, both balanced and well-researched.

Alas, none of it found its way into the main manifesto, which talks of ‘making Britain a European hub for hi-tech, digital and creative industries’ (whatever that means). We do know the Conservatives plan to scrap the Regional Development Agencies, which will affect the Regional Screen Agencies whom they co-fund and, therefore, support for film in England.

There's little point in speculating further about future film policy. We'll know more next week...

More on East Midlands investments

Last October I posted about the East Midlands Media Investments Fund (EMMI), as featured in EM Media's review of Economic Achievements 2008/09, which I was covering at the time.

Just last week EM Media and the East Midlands Development Agency announced a further round of EMMI investments, totalling over half a million pounds, including four feature films (The Brutal Game, Oranges and Sunshine, Tyrannosaur and The Weekender), a feature documentary (AnDa Union), TV development (Over the Hill and Under Cover), a documentary short (PS, Your Mystery Sender), a Facebook application (GangstaPets), and an online game (Natural Born Racer).

A tenth project will be announced shortly, and EM Media anticipates these investments will together deliver over 90 jobs, generating around £13 million for the East Midlands economy. This latest round of support brings EM Media's total to 37 feature films, 75 short films, 15 TV and 15 games and interactive investments to date.

Further information, including details of the talent involved in the funded projects, can be found on EM Media's web site.

Montage: French film in 2009; MPAA theatrical market statistics; FDA Yearbook; digital cinema; UK facilities sector

What a week it’s been for film business research. I'm struggling to keep up.

On Tuesday the Centre national de la cinématographie (CNC) published an overview of French film production in 2009, followed on Wednesday with news of the 2009 worldwide box office from the Motion Picture Association of America (MPAA). 

And only yesterday the Film Distributors Association (FDA), a UK trade body, published its statistical Yearbook at a launch hosted by FDA President Lord Puttnam.

This joyous bestowal of manna from heaven is not just confined to the last seven days. The previous week saw a digital cinema update from Screen Digest, and the UK Screen Association released its study of the UK facilities sector.

A surfeit of statistics indeed, but it'd be churlish to complain. Let's loosen our belts and get stuck in, starting with the CNC report (Bilan de la production cinématographique en 2009).

The press release paints a sobering picture: production investment fell by over one quarter (26.3%) to stand at €1.1 billion in 2009, compared with €1.5 billion in 2008. And fewer films were made during the last year, declining from 240 in 2008 to 230.

Of these, fewer were big budget features, and there was a consequent decrease in average budget size, which stood at €5.1 million in 2009 compared with €5.6 million in 2008 (adjusted to counter the distorting effect of the very highest budget films in 2008). For the first time since 2002, no French majority production was budgeted over €40 million. The full report also goes into detail about investment by French broadcasters and the CNC itself, and provides an overview of co-production activity plus plenty of other telling insights.

Over the pond, the MPAA’s Theatrical Market Statistics 2009 report serves up an equally hearty portion of market intelligence, ranging across worldwide box office and admissions trends, audience demographics, screen numbers and US production levels.

Briefly:

• Global box office gross totalled $29.9 billion, an increase of 7.6% over 2008;
• The US/Canada box office hit $10.6 billion, up more than 10% year on year;
• 3D releases accounted for 11% of the US/Canada total, compared with 2% in 2008 (and this from only 20 3D releases in 2009, up from eight the year before);
• 1.4 billion cinema tickets were sold in US/Canada, rising 5.5% over 2008- the first such increase in two years. Admissions per capita also increased to 4.3 in 2009. According to the press release, ‘sales were fuelled by repeated visits to the cinema by frequent moviegoers – those who go to the movies once a month or more and who make up only 10% of the population – who bought half of all tickets sold in 2009’;
• Worldwide there were around 150,000 screens, and 11% of these (16,000) are digital (more on this later);
• There were 6,039 cinema sites in the US, and Megaplexes (with 16 or more screens), which account for 29% of all screens, saw strongest growth in 2009. Almost half (46%) of all screens are now located in Multiplexes (8-15 screens), and single screen venues represent just 4% of the total.
• The production of US films has declined over the last three years, and in 2009 the number released in the US decreased 12%, the first such decline since 2003. The press release attributes this to all manner of recent trials and tribulations including, ‘labor issues affecting the industry in 2007-08, the recession and the challenges to investment recovery due to rampant content theft, and the decline in DVD sales.’

Check out the full report (a free PDF download) for further detail and some eye-catching time series charts.

Lord Puttnam’s address at the launch of the FDA’s Yearbook made much of the opportunities for new distribution models afforded by digital media and social networking. The Yearbook itself is available on request from the FDA, and according to Stuart Kemp, writing in The Hollywood Reporter, it contains some ‘mouth watering stats’, including the fact that ‘one in every five pounds spent at the UK box office was forked out on comedies last year’, and ‘one in every eight pounds was spent […] on 3D movies’.

This latter point echoes data about the growth of 3D presented by Screen Digest as part of its Cinema Intelligence service. 55% of the 16,405 digital screens worldwide are 3D capable. A Screen Digest press release describes the growth of 3D screens in 2009 as ‘nothing short of explosive, with a global growth rate of 254.5%, but this average is dwarfed by the growth rate of 614% in Western Europe’.

The release also notes tests are being conducted with 3D alternative content (e.g. 3D sports broadcasts), a subject previously covered in a Screen Digest report dedicated to alternative content (which was also addressed by Beyond Live: digital innovation in the performing arts, a study of live theatre screenings in cinemas by Hasan Bakhshi and Juan Mateos-Garcia of NESTA and Professor David Throsby).

Anyway, here’s what David Hancock, Screen Digest’s Head of Film and Cinema, had to say about the revitalising potential of digital roll out:

“The release of Avatar was the BC/AD moment for digital cinema, taking us from the prehistory of the first 10 years, characterized by research, false commercial starts, standards development and early pioneers, to the modern world of commercial cinema as it will be in the decades to come. Digital 3D, opera, theatre, music and comedy in cinemas, live 3D sport, and interactive adverts are all a part of cinema in the future; not just a place to watch movies but a multi-arts venue which can be the heart of small and large communities alike. The refreshment of cinema is firmly underway and it is now taking its place as an integral part of the digital media landscape on the one hand, and as a revitalised leisure venue on the other.”

The UK Facilities Sector: a key contributor to the film and television industries and to the UK’s creative economy, a study undertaken by Olsberg SPI and Trends Business Research on behalf of UK Screen Association, Ascent Media and the UK Film Council, shines a light on an oft overlooked part of the business- the all important facilities sector, which includes post-production, equipment hire, visual effects, graphics, transmission services, studios, outside broadcast and physical effects companies.

According to the press release, the study estimates the UK sector had an annual turnover of £2.2 billion in 2008.

Other key findings to note:

• The sector comprises 1,300 companies, employing more than 25,000 people.
• Despite this large number of companies, ‘only a very few have achieved scale in their operations’.  The sector is dominated by small and medium-sized enterprises, with 99% of firms employing fewer than 250 people, and 78% employing fewer than 10.

The report also contains an obligatory ‘economic impact’ assessment for 2008, with an estimate of jobs generated by the sector (50,850), the sector's Gross Value Added (totalling £1.6 billion) and contribution to the Exchequer (£262 million, excluding VAT).

There, we made it. Here's hoping for a quiet weekend.

UK film production in 2009, and US tax incentives in passing

In addition to publication last week of the UK’s annual box office and admissions totals, the UK Film Council released a slew of production data for 2009.

The press release accompanying the report (Film production in the UK – Full Year 2009 Report) carries the words ‘mixed’ and ‘fortunes’ in the title, which seems about right.

For while the UK benefited from £752.7 million of inward investment feature spend in 2009, pushing total spend for the year to £956.9 million (up 56% on 2008’s total), domestic feature and co-production activity was far less impressive.

The production of domestic features contributed £169.2 million to the total spend for the year, down from £207.2 million in 2008 (Figure 1). Meanwhile spend on UK co-productions amounted to a miserly £35 million, barely enough to pay for half an hour of Avatar’s runtime. UK 'co-producers', a species under threat, must surely know how the Na’vi feel.

Figure 1: UK spend of features produced in the UK, 2003 - 2009, £ millions

Source: UK Film Council

The overall number of UK productions has been remarkably consistent over the last three years. 125 features with budgets over £500k were made in 2009, compared with 126 in 2008 and 127 in 2007. But it’s a far cry from the heady days on 2003, when cameras rolled on 196 productions, over half of which were co-productions (Figure 2).

Figure 2: Number of features produced in the UK, 2003 - 2009

Source: UK Film Council

Although the number of co-productions held steady at 22 in 2009, the level remains at a historic low, ‘a function of the one flaw in the otherwise excellent film tax credit’, according to the UK Film Council, ‘which disincentivises UK participation in co-productions by focusing tax relief on production spend made on the ground in the UK.’

This idea of the unintended (and unwelcome) consequences of fiscal policy also surfaces in a ‘Special Report’ on US movie production incentives (MPIs) issued earlier this month by the Tax Foundation, a US-based ‘nonpartisan educational organization’.

The Foundation favours broad-based, low level taxation and is firmly opposed to tax credits and incentives for particular industries. So the report’s indictment of MPIs (described in the title as ‘Blockbuster Support for Lackluster Policy’) is hardly surprising. ‘While broad-based tax competition often benefits consumers and spurs economic growth and development’, writes report author William Luther, ‘industry-specific tax competition transfers wealth from the many to the few. Movie production incentives are costly and fail to live up to their promises’.

For me, the more startling realisation is that MPIs are now so widespread in the US. In Europe, and in many other parts of the world where home markets are dominated by US studio product, we’re quite used to public money supporting the local industry. But I had no idea of the number of US states offering tax and other incentives for feature production. Back in 2002 only five states offered MPIs. Since then, 39 other states have joined the party (in what Luther terms the ‘arms race of incentives’), including Hollywood’s home state of California.

Interestingly enough, FilmLA has recently credited the California Film and Television Tax Credit with easing the annual rate of decline in location shoots in the state. According to numbers released last week, on-location feature film production in Los Angeles fell by 29.9% in 2009, ‘the steepest year- over-year decline since tracking began in 1993’, although production activity rose in the final quarter of the year thanks to ‘incentive-driven production’ (the film incentive scheme came on stream in July 2009). In light of data such as these, the scrabble for production dollars is only likely to intensify and MPIs are bound to figure prominently for some time to come.

Australian feature film production 2008/09

Australia witnessed a surge in production activity last year (2008/09), with a sharp rise in budget expenditure according to results of the latest annual National Survey of Feature Film and TV Drama Production published earlier this month by Screen Australia.

In 2008/09, a total of AUS$358 million was spent in Australia on feature film production (with total budget expenditure of AUS$393 million), up from AUS$170 million in 2007/08. The increase was driven by two big-budget local productions, Zack Snyder's Guardians of Ga’Hoole and Happy Feet 2. The 2008/09 tally is also higher than the rolling five-year average of AUS$194 million.

During the year, 32 Australian features and co-productions began shooting in Australia, which marks a decrease from 38 productions in 2007/08 (but is on a par with the rolling five-year average of 32). A list of the feature film titles included in the Survey can be found here.

Australian productions (defined as those 'under Australian creative control' where 'the key elements are predominantly Australian and the project was originated and developed by Australians', including projects 'under Australian creative control that are 100 per cent foreign financed') accounted for 91% of all productions in the year (29 out of 32) and 95% of Australian expenditure (AUS$365 million out of AUS$358 million).

83% (24 out of 29) Australian productions fell within a budget range of AUS$6 million and under, much the same level as the five-year average.

Three co-productions shot in Australia in 2008/09 (At World’s End [Australia/Germany], The Boys Are Back [Australia/UK] and unofficial Australian/US co-production Beauty and the Beast), with Australian expenditure totalling AUS$17 million. This is lower than in the previous year, when five co-productions shot in Australia with local expenditure totalling AUS$49 million. 

The Survey helpfully identifies sources of finance for 2008/09 productions:

• 13 (41%) were financed 'principally by Australian film/TV industry sources, including cashflow against the Producer Offset where it was reported as part of the film’s production finance';
• 11 (34%) were financed 'substantially from direct government sources (primarily Screen Australia, although this also included the state agencies, and the Adelaide and Melbourne Film Festival Funds)';
• 7 (22%) were financed 'principally from foreign sources' (including all three co-productions and four local titles); and
• One (3%) film was financed 'substantially from private sources'.

Source: Screen Australia

In terms of the proportion of total finance from each source, government sources accounted for 9% (AUS$35 million), foreign sources provided 57% (AUS$224 million), Australian film/TV sources ponied up 33% (AUS$130 million) and private sources contributed 1% (AUS$5 million).


Source: Screen Australia

Despite the apparent strength of production activity in 2008/09, it is noteworthy that earlier this week the Screen Producers Association of Australia (SPAA) asked the Australian government for additional support to the tune of AUS$84 million over three years, in an effort to attract institutional investors for feature production (Screen Daily has the story). SPAA maintains the Producer Offset (PO) is not working as envisaged, and extra support is required in the current financial climate.

In contrast, Screen Australia takes encouragement from its Survey findings. “This is an important result for the industry,” Ruth Harley (Screen Australia’s Chief Executive) is quoted as saying in the press release announcing the findings. “2008/09 was the first full year of operation for the Producer Offset, and while a single year’s data makes it difficult to attribute the strong level of Australian production to the effect of the Offset alone, the outlook is encouraging, particularly considering the financial uncertainty that characterised 2008/09".

The debate about whether PO is working or not is set to continue, providing a great example of the way market data can figure in public policy decision making. Within this context, one measure of a competitive film industry (to use the UK Film Council's term) is the level of private investment it can attract on a consistent basis, although as far as I'm aware no state agency anywhere in the world has publicly committed itself to a data collection regime and a set of targets that would put such a metric into practice in any meaningful way. If anyone out there has any thoughts or practical suggestions, I'd love to hear them.

Incidentally, the National Survey of Feature Film and TV Drama Production also provides data on foreign features shot in Australia,  Australian TV drama production activity and income from post, digital and visual effects (PDV) services.

UK feature film certification data, January to September 2009

The level of UK feature production activity looks to be on the rise according to data published last week by the UK Film Council.

The number of interim certifications awarded by the Secretary of State, a rough-and-ready upstream indicator of future production levels, rose from 102 in the period January to September 2007, to 130 in the first nine months of 2009.

In 2009, 114 interim certificates were awarded to Schedule 1 films (those that have passed the UK Cultural Test to qualify for tax relief), and 16 co-productions received interim certificates.

The number of UK co-productions has declined in recent years (as noted previously), and though it may be premature to draw firm conclusions these data suggest the downward trend may have stabilised (for the time being at least). In 2007, 20 co-productions received interim certification between January and September, compared with 11 in 2008 and 16 in 2009 (a modest recovery, of sorts).

The briefing note (British film certification, Jan-Sept 2009) also includes final certification data for films shot in the previous three years, confirming the general pattern of activity described in last month’s UK production statistics for 2009.

British film certification, Jan-Sept 2009 can be found on the UK Film Council ‘statistics release calendar’ page, or downloaded as a PDF direct from here.

UK feature film production, January to September 2009

The UK Film Council has just released the latest UK feature film production data, offering a mixed bag of positives and negatives in these straitened times.

During the first nine months of the year, the total spent on feature production in the UK stood at £857.2 million, an increase of 67% on the total UK spend for the same period last year (£512.3 million), and 15% up on the first nine months of 2007 (£742.8 million).

In fact, as the UK Film Council briefing note (1) points out, 2009 witnessed the ‘best first nine months since 2003’ (see Figure 1).

Figure 1: UK film production, Jan-Sept 2003 to Jan-Sept 2009

Source: UK Film Council

As usual the increase in UK spend was driven by inward investment feature production, which accounted for 80% of the total UK spend between January and September 2009. That’s the highest proportion since before 2003 (when accurate records began- see Figure 2), reflecting the effect of the weak Pound and the UK’s generous tax incentives in attracting big-budget studio films to shoot here.

Figure 2: % of total UK spend by production type, Jan-Sept 2003 to Jan-Sept 2009

Source: UK Film Council

The number of inward investment features also rose (to 28, from 22 in 2008). 2009 titles include Clash of the Titans, Get Him to the Greek, Gulliver’s Travels, Harry Potter and the Deathly Hallows Part I, Inception, London Boulevard, Never Let Me Go, The Chronicles of Narnia: Voyage of the Dawn Treader, Untitled Robin Hood Adventure and Your Highness. The average budget of an inward investment feature stood at £52.8 million in the first nine months of 2009, compared with £30.7 million in 2008 and £31.2 million in 2007 (figures for 2008 and 2007 are for the full year).

The number of UK domestic productions shot in the first nine months of 2009 (62) remained at much the same level as in the previous year (61), but the value of UK spend on domestic features fell from £182.8 million in 2008 to £154.2 million this year.

The briefing paper notes that average and median budgets of UK domestic features have fallen over the last six years, reflecting ‘market and financing pressures to make films at lower budget levels than a few years ago’. In 2003 the average domestic feature budget stood at £5.6 million, compared with £3.1 million in 2009. The median domestic feature budget (the calculation of which is not skewed by extreme values at either end of the budget scale) has fallen from £2.9 million in 2003 to £1.4 million in 2009.

The outlook for co-productions is altogether gloomier. Only eight co-pros started shooting between January and September 2009, compared with 18 during the same period in 2008, and 23 in 2007. This decline in activity is matched by a fall in the value of UK spend on co-productions, which stood at a mere £16.6 million in 2009 as against £45.8 million in 2008 and £54.7 million in 2007.

'The one ongoing concern', UK Film Council’s CEO John Woodward reflects in the press release, 'is in relation to the continued drop in UK independent co-productions. This is largely a function of the one flaw in the otherwise excellent film tax credit which disincentivises UK participation in co-productions by focusing tax relief only on production spend made on the ground in the UK.'

In this context it is worth noting that Ed Vaizey, Shadow Arts minister, told delegates at this week's Screen International Film Summit  that the tax credit system would be safe under the Conservatives, and that he remains open-minded about changes to assist co-productions. Let's hope so.

(1) The briefing note (available to download as a PDF here) contains a description of the data collection methods and definitions employed by UK Film Council production tracking.

Montage: Studionomics subverted; streamed performances at the cinema; UNESCO film study

Last month I wrote a piece about data-driven guesswork (aka studionomics) endemic in the film business. The team behind MarqueeStars.com, which served as an example in the post, has since responded in kind with an article outlining their philosophy and intentions (‘Wolves in the Number Cruncher’s Hen House’).

Actually it’s more like a declaration of independence; far from being in thrall to studionomics, it turns out Marquee Stars is there to subvert it.

Tao Jonez (for 'tis their pseudonym) writes of the entertainment business evolving ‘along increasingly dysfunctional lines’:

‘Studio bosses and distribution execs have developed an unconscious addiction for the data wranglers and trend spotters in ways that stifle creativity … much of it unnecessary and, frankly, not sufficiently supported by the data … at least not to the extent that their numerical parameters are enforced.’

Siding with filmmakers rather than the suits, Marquee Stars strikes a blow against ‘numeric oppression’, providing a service ‘for the victims of the number addicts’:

‘We do it fairly and honestly; we do it using corroborated data; but we do it as a skeptical double-check on the mind-numbing pronouncements we hear from studio bureaucrats, territorial film buyers and foreign sales agents.’

All of which I find very refreshing and really rather admirable. It just goes to show you shouldn’t judge a web site by its animated avatar.

Onto research of another kind, with news that Professor Martin Barker of Aberystwyth University has teamed up with Picturehouse Cinemas to study alternative content streamed in cinemas (ballet, plays, opera etc.). 

The research (‘Steamed Performances’) serves an academic and commercial purpose, and was prompted after Professor Barker attended a streamed performance of Phèdre, with Helen Mirren, during which he 'noticed some unusual things’:

‘Some people appeared to dress up for the cinema as though they were going to the theatre.  Many people didn’t know whether or not to clap.  It made [Prof. Barker] wonder about the senses in which the performance was ‘live’ and how this affected people’s enjoyment and participation.’

From a commercial point of view the research presents an opportunity to examine audience demand for such events, and to discover what makes this type of programming special.  Streamed performances are becoming increasingly common; the number of such events rose from 31 in 2007 to 67 in 2008 according to Screen Digest data reproduced in the UK Film Council’s Statistical Yearbook 2009 (see Chapter 10).

Just as significantly, audience numbers can be impressive. Earlier this year the National Theatre launched NT Live, with the aforementioned performance of Phèdre, which was streamed in 73 venues across the UK to an audience of 14,000. More recently, a performance of All’s Well that Ends Well was attended by 11,000 people in the UK alone (these figures are taken from the NT Live web site).

The fieldwork is currently underway and Professor Barker is aiming for over 1,000 survey responses from streamed performance audience members. If you’ve been to a performance and fancy sharing your experience you can complete the questionnaire online here (a Welsh language version is also available here). Best of all, the research team promises to publish the results on the Steamed Performances web site. And if they can get Helen Mirren to read the report out live, I'll be first in the queue at the cinema.

Speaking of academic research publications, Nikki Finke, the doyenne of film biz bloggers, posted recently about a report issued by the UNESCO Institute for Statistics (UIS) and the Institut de la statistique du Québec (available here as a PDF download).

The UIS report is a measured and generally well written survey of film statistics based on data obtained from 101 countries for the years 2005-2006 (well written with the exception of one unfortunate mixed metaphor: ‘Digital film production has given birth to a two-edged sword.’ Youch!).

The accompanying press release, and Nikki Finke’s coverage, leads with the finding that Nigeria’s film industry is the world’s second most prolific producer of feature films after India. But hang on a mo: the 872 Nigerian productions counted in 2005 were shot in ‘video format’. As the report authors go on to point out, ‘the robust position of Nigeria film production is due to the fact that the films are shot in digital video format in two or three weeks on small budgets’.  Which is hardly a strong basis upon which to compare national production levels across developing and developed countries, a point noted in a number of the comments left on Finke’s blog.

In fairness the report authors are assiduous in qualifying their description of these data, and in turn pose some thoughtful questions about African production practices:

‘Are we seeing here a sustainable trend [towards the video format], and if so, what are its implications? Will there be a positive influence on film production in Africa in general, and in particular in other countries in West Africa, where it is practically non-existent?’

Given that 99% of the 4,871 cinemas reported in Nigeria are ‘video theatres’, the shift to video also has implications for the exhibition sector.

The report also addresses rates of co-production activity in different countries, the nationality of distribution companies, cinema admissions by country of origin, rates of digital production and the language in which films are made.

However, the main story does not emerge from the data, but from the context of their collection. The UIS report confirms what anyone who has ever tried to source international film data already knows: there are some dirty great holes in the data record, particularly across the developing world. Still, it’s good to see UNESCO making the effort.

Adventures in Robin Hoodland

Earlier this month EM Media published its annual review of Economic Achievements 2008/09.

If you’re not already acquainted with it, EM Media is the Regional Screen Agency for the East Midlands, the Government Office Region encompassing the counties of Derbyshire, Leicestershire, Lincolnshire, Northamptonshire, Rutland and Nottinghamshire, Robin Hood’s haunt of legend.

The review provides a fascinating snapshot of regional investment and returns, with evidence that the East Midlands derived clear benefit from the UK’s first sector-specific Venture Capital Loan Fund, the East Midlands Media Investments Fund (EMMI for short). Between 2006 and 2008 the Fund enabled EM Media to invest £6 million of European Regional Development Fund (ERDF) money in what it calls ‘the film and digital content sector’ (which includes TV and interactive media). 

ERDF money is intended to stimulate economic development and regeneration in Europe’s least prosperous regions; which, if you think about it, is a macro-scale redistribution of wealth paralleling Robin Hood’s MO of taking from the rich and giving to the poor. Or, as the European Commission puts it with customary panache, ‘correcting imbalances between [Europe’s] regions.’

So, £6 million of European money went into EMMI and was invested across 65 projects, including 46 film investments. In addition, these projects attracted £33.2 million of leveraged funding (£19 million from private sources, and £14 million of other public finance).

The result is a portfolio of projects valued in 2008 at £3 million, with ongoing earning potential to help support future investments (the portfolio includes acclaimed features like This is England and Control). I note that Nicholas Winding Refn’s film Bronson, which received £250,000 from the Fund, has recently opened to strong reviews in the US, achieving 70.4% positive critical notices according to Movie Review Intelligence. And while we’re on the subject, The Damned United, funded in part by Screen Yorkshire and a recipient of in-kind support from EM Media, has had excellent reviews stateside- 80.1% positive- since opening last week in NY and LA. Top that off with An Education’s exceptional critical reception (92.2% positive reviews), and it’s been a good week for UK domestic features over the pond.

Back to EMMI and, according to EM Media, 41 permanent and 563 temporary jobs are also directly attributable to the Fund between 2006 and 2008, along with less directly measurable (but arguably no less important) assistance for 262 companies in the region. Taking all these factors together, EM Media has valued the Fund’s economic benefit to the region at around £70 million- a notable achievement worthy of an Alan-a-Dale ballad.

EMMI is not the only funding strand managed by EM Media. The agency also invests RIFE lottery and grant-in-aid money in film projects and organisations on behalf of the UK Film Council, along with funds from the East Midlands Development Agency and other sources. 

The upshot is that in 2008/09, EM Media invested in a total of eight feature films and one feature documentary, including local girl Samantha Morton’s directorial debut The Unloved. Three externally produced features also filmed in the region, which means that nearly one in five (18%) UK domestic features were made in the East Midlands in the course of the year. Not bad considering it has no permanent studio infrastructure.

The region saw a 6% increase in film shooting days (which have risen from fewer than 25 in 2003 to around 300 in 2008) and film and TV production in the region created employment for nearly 900 freelance crew. EM Media calculates these productions brought inward investment to the value of £16 million to the region in that year alone.

The question remains whether these levels of investment and success are sustainable given the completion of EMMI’s three year term, the squeeze on public finances that is likely to see a fall in RIFE money and uncertainties over regional development funding under a future Conservative administration. We’ll doubtless find out in next year’s review, and those that follow.

Anyway, to end here's my favourite Robin Hood-themed story, which issues from the early 1990s and concerns a young couple planning their wedding.

Riding high in the charts at that time was Bryan Adams’s theme tune to Robin Hood: Prince of Thieves, and being impetuous romantics of unsound mind the couple request the track to accompany the bride up the aisle.

The big day arrives, but, alas, all does not go to plan due to a misunderstanding on the part of the befuddled organist. Instead of Bryan Adams's ‘(Everything I Do) I Do It For You’, the bride is forced to proceed up the aisle, past wide-eyed friends and family, to the strains of Dick James’s theme tune to The Adventures of Robin Hood (‘Robin Hood, Robin Hood, riding through the glen…’).

Needless to say, there was not a dry eye in the house.

Film in the UK

The debate about the twenty-five best British films of the last quarter of a century continues to crackle and fizz over on the Guardian film blog, with 200+ comments and rising.

Following a quick scan, none of these contributors appear to have picked up on the substance of Jason Solomons’s feature article about the present state of our national cinema. But the forum is now open should anyone feel like chipping in.

Anyway, there must be something in the water because the UK Film Council has recently published a briefing paper on film in the UK. The paper picks up where the 2009 Statistical Yearbook left off, with an assessment of the local industry's strengths and weaknesses, a history of public support for film in the UK, a section on the cultural role of film in Britain and a directory of major film companies, trade associations and public film bodies.

I have to confess to an interest here, having contributed to the briefing paper. But don’t let that put you off. It’s a substantial piece of work, and a useful point of reference whether or not you happen to agree that Trainspotting (1996)/ Brazil (1985)/ Carry on Columbus (1992) [delete as applicable] should head the top 25 Brit flick list.

Just picking up on one thread from Solomons’s article, I was interested to read Screen’s coverage of news that UK indie distributor Revolver is setting up Gunslinger, it’s own production arm.

Justin Marciano, Revolver CEO, is quoted as saying:

'Gunslinger allows us to do what many others in the industry can’t - by being in constant contact with the marketplace, we can essentially reverse engineer how we approach film production by delivering a product with the right sized budget to fit its market value.'

Applying distribution know-how to film development, finance and production is not a new idea: it’s what powers the major studios’ model. But as Geoffrey Macnab points out in another Screen article, it is becoming increasingly common among UK distributors, and it runs with the grain of the main plank of distribution-led film policy.

'We’re much better placed as distributors to understand our marketplace,' Zygi Kamasa, CEO of Lionsgate UK, told Macnab.  'We’re the domestic territory for these movies. Domestic is normally North America, but in this case the UK is the domestic territory.' 

Will Clarke, Optimum Releasing’s CEO, makes a related point: 'We’re at the coal face. We know exactly what a particular film will do through its various ancillaries.'

Echoing this theme, here’s Justin Marciano again: 'So many films are made in isolation without proper input from a distributor that when they come to market it’s too late to make the changes necessary to fully capitalise on the film’s strengths.'

Solomons floated his exhibition-led plan for rescuing contemporary British cinema from mediocrity and/or obscurity (the 'British Screen' multiplex quota). Over the coming year or so we’ll see how far the distribution-led approach is up to the challenge.

Montage: Sweden H1 2009 admissions and box office; US DVD rental kiosks; Pinewood Shepperton trading report

Figures released by the Swedish Film Institute reveal strong growth in cinema admissions during the first half of 2009.

7,570,828 tickets were sold in the first six months of the year, a rise of 27% on the same period in 2008. Total box office gross also rose, up 36% to SEK 655,031,193.

It’s heartening to see that Swedish films shared 32% of the market, largely down to the success of local title The Girl with the Dragon Tattoo, which clocked over 1 million admissions. According to Thomas Bryntesson, Head of Statistics at the SFI, these figures 'show again that during a recession, cinema attendance tends to remain strong.' (quoted in Cineuropa.org).

Table 1: H1 admissions and box office gross in selected countries

Sources: Filme B, Nielsen EDI, CAA, Danish Film Institute, Cineuropa.org, Federation of Spanish Cinemas, State Administration of Radio, Film and Television, Korean Film Council, Cinetel, Bunka Tsushin, boxoffice.pl, CNC, Swedish Film Institute.
Notes: Figures have been rounded. ‘-‘ = data not yet available

Moving to home entertainment, and the latest issue of Variety provides further coverage of strained relations in Hollywood over the growth of the DVD rental kiosk business, led by Coinstar’s Redbox service. Correspondent Marcy Magiera cites a new study by NPD that forecasts the DVD-rental kiosk business (which offers overnight rentals for $1) will hold 30% of the rental market by the close of 2010 (up from 19% currently).

As Magiera notes,

‘Hollywood is clearly divided over Redbox and its rivals. There's been a flurry of litigation over the kiosks -- Warner Home Video, 20th Century Fox Home Entertainment and Universal Studios Home Entertainment are trying to impose a delayed window of 30 days or more on kiosk rentals, and Redbox is suing them as a result.’

These studios are concerned that cheap rentals cannibalize new DVD sales, and evidence from Rentrak does indeed reveal a slump in DVD sales in the first half of 2009 (-13.5%) compared with a rise of 8% in consumer spending on DVD and Blu-ray rentals. Still, at least these punters are actually paying for content and not (exclusively) frequenting unauthorised online sources...

Finally, Pinewood Shepperton, the UK studio and facilities group, recently issued a trading statement (Regulatory Announcement) for the period 1 January 2009 to 30 June 2009, providing a nifty vantage point from which to gauge UK production activity.

Revenues totalled £20.3 million during the first half of the year, down 6.5% from £21.7 million in the first half of 2008. Operating profit was also down, from £4.8 million in 2008 to £3.3 million, and profit before tax stood at £1.7 million.

Commenting on the results, Ivan Dunleavy, Chief Executive of Pinewood Shepperton plc, said: 

'The marginally lower year on year film revenues reflect the impact of the Screen Actors Guild dispute. The results reflect a solid performance in television and demonstrate the value of our Media Park where revenues increased. Looking forward, film revenues for the remainder of the year will depend, as ever, on the timing of new film starts in the latter part of the second half. Television revenues are expected to be stable, despite broadcasters' programming cuts. Media Park revenues should remain robust.'

While the SAG dispute played its part, film revenues were also affected by what the Announcement calls ‘wider economic pressure’, which has ‘tightened the access to film financing’. The result: ‘producers are taking longer to commence productions’.

We’ll no doubt see the continuing effects of this on the wider UK production sector when the UK Film Council publishes feature production statistics for the third quarter 2009 in October (see their statistics release calendar for details).

UK film at home and away

Shortly I’ll be off on holiday so there’ll be a break in the usual service until I surface again.

But before heading out the door there’s time for a quick post about UK film.

A couple of weeks back I flagged up publication of the UK Film Council’s latest Statistical Yearbook, and promised to return with my take on the highlights. The challenge is deciding where to begin, but I’ll plump for a chapter dealing with UK film performance for starters.

Chapter 8 addresses the theatrical release history of UK films. It reports that fewer than half (44%) of UK films shot between 2003 and 2006 secured a UK release within two years of principal photography. The films that made it onto the big screen accounted for 71% of the total UK film production budget over this period.

Which means that most UK films made in the period, accounting for 29% of total production spend, failed to secure a home distribution deal within two years, although in fairness some of these films did get released overseas (62% of UK films shot between 2003 and 2006 were released in at least one of 12 international territories for which the UKFC has data).

The chapter also looks at the financial success of UK films, drawing tentative conclusions about profitability based on a proxy measure (the ratio of international box office to budget). The UKFC reasons that if a low- to medium-budget UK film generates international box office revenues over twice the size of its production budget then there’s a good chance it’ll be in profit after returns from ancillary revenues are taken into account and costs are deducted. Anything less than this and the film is likely to make a loss.

The chastening news is that only 35 (11%) of the 333 UK films made between  2003 and 2006 and released internationally scored a box office to budget ratio of two (or more) to one. As the Yearbook concludes,

‘this suggests that only a small number of internationally-released UK feature films are likely to have made profits for their producers and investors and underlines the highly risky nature of film investment.’

On the bright(ish) side, time series data suggest the proportion of films made in each year between  2003 and 2006 that achieve a box office to budget ratio of two or more has increased year-on-year (it stood at 6.8% in 2003, and 17.1% in 2006).

I hate to end my pre-holiday post on a low note. So here’s a bit of cheery news from the US. A number of UK films on release over the pond have been very warmly received by the critical establishment. And courtesy of MovieReviewIntelligence.com we can put numbers to this. Thus the latest Harry Potter is going great guns at the US box office ($238 million to date) and scored a highly impressive 82.3% positive reviews.

Not far behind, Franny Armstrong’s climate change docudrama The Age of Stupid has garnered 80.5% positive reviews (albeit in only a handful of respected organs).

And there’s more: In the Loop (77.2% positive reviews), Duncan Jones’s Moon (74.1% positive) and Shane Meadows’s Somers Town (69.0%) all scored well above the average across all movies in the database (currently running at 52.5% positive reviews. Figures correct at the time of writing).

Whether or not this critical acclaim will translate into box office success in every case remains to be seen. But it’s heartening nonetheless.

And on that note, I’m off. Back in two weeks.

UK feature production, H1 2009

Good to their word, yesterday the UK Film Council published production numbers for the first half of 2009, based on data derived from their tracking of UK features shot for £500,000+ and produced in whole or part in the UK.

The first six months of 2009 saw the best total UK spend figures since 2004, at £535.1 million, up from £363 million in H1 2008 and £402.5 million in H1 2007. This was driven by the return of big budget inward investment features to the UK (the likes of Harry Potter and the Deathly Hallows Part I, Clash of the Titans, and Gulliver’s Travels), which accounted for 82% of the total UK spend value.

Overall, however, the total number of UK films in production during the first half of 2009 was down on the same period in 2008, standing at 48 compared to 60 the year before (and 66 in 2007).

UK domestic productions numbered 33 in the first half of 2009, with a UK spend value of £89.9 million. Meanwhile, as predicted, the number and value of co-productions continued to decline after last year's short-lived H1 rally. There were only three co-productions in the first half of 2009, with a UK spend value of just £8.9 million, down from 14 in the same period last year (with a UK spend value of £41.6 million).

The report also draws attention to the trend in recent years towards a fall in average and median UK domestic film budgets. The average budget for UK domestic films has fallen from £5.6 million in 2003 to £3.3 million in the first half of 2009, while the median domestic UK film budget has fallen from £2.9 million to £1.3 million.

You can find more on this in the full paper, available here. Further details can also be found in Chapter 17 of the UK Film Council 2009 Statistical Yearbook, which was also published yesterday. I’ll be covering that substantial document in the coming days.

On the compatibility of 'cinema' and 'Britain'

As I write, the Edinburgh International Film Festival is in full swing. EIFF has long championed the best and brightest of our national cinema, and this year’s British Gala strand, from which the annual Michael Powell Award-winner will be drawn, offers up a gratifyingly eclectic mix. EIFF also publishes the indispensable Film UK Guide to British Film, listing key details of all British fiction feature and short films completed in the last year (the 2009 edition can be downloaded here.)

And either by happy chance or design the UK Film Council has just launched a major new report on the cultural impact of British cinema. The research, Stories We Tell Ourselves: The Cultural Impact of UK Film 1946-2006, was conducted by a research team drawn from Birkbeck University (led by Professor Ian Christie), Media Consulting Group and NARVAL Media. It marks the first concerted effort to measure, analyse and describe the impact of our national cinema on the wider culture at home and abroad. In the terms of a classic British understatement, this is no mean feat.

In recognition of the scale of the challenge, the foreword, from UKFC CEO John Woodward, indicates the report's preliminary status as a starting point for further enquiry and debate (scholarly or otherwise), rather than being the last, definitive word on the subject. The report can be filed under 'Pending further attention', and I look forward to reading what others make of it. My own view is that this is a thoughtful and stimulating beginning to what deserves to become a fecund arena of future study.

The researchers examined two samples of films drawn from a database of all UK feature-length films known to have been released over the reference period 1946-2006. The first comprised an 'intuitive list' of 200 such films that are widely regarded as 'significant and of lasting value' (ranging from The Life and Death of Colonel Blimp [1943] to This is England [2006]; the full list is available in the report appendices). The second sample was drawn randomly from the database, and 'devised as a check against the unavoidable subjectivity of the intuitive list'. The two samples overlap; Lawrence of Arabia (1962), for example, crops up in both.

In broad terms the researchers found that the films in the random sample tend to reinforce mainstream British values, whereas those in the intuitive sample 'tended to challenge or satirise those values.'

The research team also examined 30 'culturally significant films' in detail, using three indices to gauge their impact: 'original impact (box office, awards)', 'extended impact (DVD re-issues, restorations)', and 'wider impact (citations in other media, evidence of esteem etc.)'.

In addition, the researchers identified four main categories of cultural impact: 'censorship and notoriety' (e.g. A Clockwork Orange), 'quotations in other media such as songs, TV shows' etc., 'Zeitgeist moments' and 'cumulative impact where films have [...] contributed to long-term changes in social and cultural attitudes.'

But the report offers much more than an assessment of impact. It also re-examines the complexion of British cinema over the reference period, challenging some of the more pervasive assumptions about it (like the idea that World War II is one of the most common settings for British films in the postwar period; turns out that films set in the 'long 19th century' (1800-1914) are more abundant). The study also highlights the role of national and regional representation in British film, and looks at how the representation of ethnicity manifests itself. There's also a section on how Britishness in films is perceived outside the UK, and the contribution that public policy has made to cultural impact.  

A number of things struck me while reading the report, a few of which I feel confident to share (the rest require further thought). The first is a slight sense of unease about the very idea of cultural impact. I can't quite get my head around the notion. Film doesn't sit askance from culture, and as such I wonder about the nature of 'impact'. As presented there is a sense of 'A' doing something to 'B', when in reality 'A' and 'B' are intertwined and likely to share a reciprocal relationship. What's missing in this account is how British film has been influenced by other cultural practices and artefacts.

This extends to the influence of other national cinemas on our own, because film travels widely. I did a little exercise a few months back where I looked at the film titles cited by over 40 successful British filmmakers as their key influence or all time favourite. The information came from profiles compiled and published on the Telegraph Film page, and the table of filmmakers and titles can be downloaded here.

Of the 43 directors, writers and producers quizzed, seven gave a British film as their key inspiration. Nearly as many (six) cited a French film. And, unsurprisingly, the majority (22 in total) offered up a US movie, including recent Academy Award winner Danny Boyle (who listed John Carpenter's The Thing [1983]).

Finally, the absence of audience reception analysis is also an issue, which the authors acknowledge. As culture is lived experience, and not simply the sum of all that is recorded either on the page, canvas, music sheet, celluloid/hard drive etc., any account of impact has to examine how we make meaning out of sensory stimulation. How does our sense of 'Britishness' inflect our reading of film, and vice versa? As this is likely to be grounded in our everyday experience of living in Britain (or as outsiders spectating from afar) we should be looking to cultural anthropologists for such insights. As the UK Film Council is unlikely to fund such research, will the academic community step up to the plate? I hope so.

Cannes Opener: World Film Market Trends in 2008

Coinciding with the start of the Cannes film festival’s near fortnight-long stately procession across the international news media, the European Audiovisual Observatory has published its annual report of world film market trends, produced in association with the Marché du Film, FOCUS 2009 World Film Market Trends.

The report is brimming with facts and figures charting the shifting fortunes of the global film business. Coverage is broken down by region, beginning with a look at worldwide trends between 2004 and 2008 (admissions, average ticket prices, screen numbers - both conventional and digital, feature production and top performing titles at the worldwide box office).

The report then looks in detail at the situation in individual countries, grouped by region: Europe, Americas, Australia, Asia, Africa and the Middle East.

Each country profile follows the same basic template, starting with key population and economic data. It’s a bit like the CIA World Factbook, although I’m almost certain the Observatory didn’t extract any of its information under torture.

The profiles include charts depicting movements in annual admissions and box office gross, and feature production between 2004 and 2008, with some descriptive text addressing production & finance and distribution & exhibition in the territory.

The sole disappointment is the absence of data on DVD and Blu-ray markets in each country. Given the scale and importance of ancillary revenue streams (a point noted in André Lange’s Introduction), the focus on production and theatrical performance in the main body of the report presents only a partial picture of the business. In fairness to the Observatory, the data on home entertainment markets is hard to come by in every country without considerable expense (assuming it is available at all). Lange’s Introduction does at least give some figures for the markets in the US, UK, France and Germany.

There is one noteworthy concession to home entertainment: the report contains figures for the number of VoD services offering films in Europe, which is a start (it’d be good to have data about the number of titles available, the volume and value of sales and rentals etc., but then maybe I’m just being greedy).

Finally, as a bonus you can flick (or click) to page 64 of the report and find all the data sources consulted by the Observatory in a table, along with their web addresses. Such a treasure trove of links is well worth the free admission price.

Launching this year’s report, the Observatory issued a press release highlighting some of the key European data. The headline figures are generally positive: a record number of feature films (including feature documentaries) were produced in the EU in 2008 (1,145 in total, up by 112 titles over 2007), a year when European films shared 28% of the theatrical market (see Table 1). Growth in feature production was not uniform across the EU; in fact, 16 out of 27 countries witnessed a rise, led by Italy (+37), Ireland (+16), France (+11) and Spain (+9).

Table 1: Breakdown of admissions in the European Union according to the country of origin

Source: European Audiovisual Observatory – LUMIERE database

Cinema attendance in the 27 EU member states increased by 0.5% to 924 million admissions in 2008. Once again, the picture varied somewhat across Europe: admissions increased in 18 out of 27 member states, while 9 countries registered a decline (Table 2).

Table 2: Cinema attendance in Europe (2004-2008 prov.) (million)

Source: Source: European Audiovisual Observatory – LUMIERE database

The 2009 edition of Focus can be found, along with its predecessors going back to 1998, on the Observatory’s web site. Bon appétit!

Cinema admissions and film production activity: UK Q1 2009

The Cinema Advertising Association (CAA) has just released the cinema admissions tally for March, which stood at 11,904,734.

That’s 2% lower than the same month in 2008, but the first quarter remains up an impressive 7% compared with last year, with a total of 41,376,613 tickets sold between the beginning of January and the end of March. It’s the best first quarter performance since 2003 (Figure 1).

March wasn’t a great month for releases; five of the top ten performers were holdovers from previous months (including Slumdog, still capitalising on its Oscar success) (Table 1). Marley & Me topped the chart during the month, taking £11.2 million, above Watchmen (£8.4 million) and Gran Torino (£5.7 million).

Figure 1: UK cinema admissions, January to March 2009

Source: CAA/Nielsen EDI

Table 1: Top ten box office performers, March 2009

The tail end of last week also saw publication of first quarter production statistics by the UK Film Council’s Research & Statistics Unit (RSU). Their briefing paper points to ‘subdued’ production activity between January and March 2009. A total of 19 films (budgeted at £500k+) went into production during the first three months of the year, compared with 31 over the same period in 2008 and 32 in the first quarter of 2007.

The fall was felt most keenly in the category of co-productions, of which only two went into production during this period. Plus there were fewer inward investment features (4 in total, down from 8 in Q1 2008). John Woodward, UKFC CEO, lays the blame for the co-pro dip squarely at the door of the film tax credit, which, he says, 'disincentivises co-productions by focusing tax relief only on production spend made on the ground in the UK.'

On a more positive note, the total UK spend (£228 million) compares favourably with 2008 (£251 million), and topped 2007’s total of £202 million. This was aided in no small part by two big budget inward investment features: Harry Potter and the Deathly Hallows: Part 1, and Ridley Scott’s Robin Hood production.

The UK Film Council points to a number of contributory factors depressing production activity:

'the impact of the ‘credit crunch’ on film financing, the downward pressure on co-productions from the new UK film tax relief based on UK spend, the continued effect of the actors’ and writers’ disputes in the USA and the high value of the pound until late 2008.'

But the RSU cautions against setting too much store by these quarterly figures, which ‘tend to fluctuate and are sensitive to timing differences (a few days’ difference in shoot date can cause films to shift from quarter to quarter).’ So it's probably best to wait and see what the half yearly figures tell us about the impact of the weakened pound before drawing any conclusions about the way 2009 is shaping up.

MPAA theatrical market statistics 2008

Movies boost people’s spirits and the economy- that’s the message MPAA CEO and Chair Dan Glickman gave exhibitors at ShoWest on Tuesday, quoting figures from the MPAA’s long awaited theatrical market report for 2008. He was, of course, preaching to the converted.

The report provides plenty of positive numbers to back up the grandstanding rhetoric: US/Canada box office (the ‘Domestic’ market) hit a record high of $9.8 billion in 2008 (up 1.7% on 2007), as did the worldwide box office gross, which totalled $28.1 billion (up 5% on 2007).

But there’s no escaping the fact that US/Canada admissions dipped last year, down 2.6% to 1.364 billion. That’s the lowest ticket sales tally since around about the mid 1990s; in fact, admissions have hovered at much the same mark for the last decade. But then in a world where ever more diversions vie for our limited attention, perhaps holding steady is an achievement of sorts.

The US/Canada market accounted for 35% of the worldwide box office gross in 2008, and Glickman took the opportunity, as world leaders gathered for the G-20 summit in London, to emphasise ‘the importance of continuing policies that keep international markets open’.

‘Now is not the time to build walls’, he said. ‘Whether it’s Indian films, UK films, French films, American films or the many others, it’s important culturally, diplomatically and economically that we strive toward openness and that we share our stories around the world, growing together rather than apart.’

I wonder how long they agonised over the order in which to list the international film industries in this quote? In any case, it would sound more sincere and less self-serving coming from the mouth of a representative of a national industry that did not dominate the world market to the detriment of many  locally produced films squeezed out by over-marketed pap.

Actually the MPAA report is a bit lighter this year, missing, as it is, the section dealing with average production and marketing costs found in previous editions. Nonetheless, it still offers some interesting insights. For example:

• Fewer films were produced in the US in 2008 (520, compared with 656 the year before), but more titles were released domestically (610, up from 599 in 2007).
• Of those movies released domestically, a larger proportion were made by non-MPAA affiliated independents. In fact, MPAA member studios accounted for only 27% of all new releases at the domestic box office, down from 32% in 2007. In 1999 this figure stood at 44%. Unfortunately, the MPAA does not give data showing what proportion of the domestic box office MPAA member releases shared (or how this has changed since 1999). But it’ll be a large figure whatever.
• The number of cinema screens increased marginally in the US, to 40,194 in 6,269 theaters. 
• The rate of growth of US digital cinema screens has been more marked, rising 18% to 5,474 (up from 4,632 in 2007). And according to Screen Digest numbers quoted by the MPAA, there were 8,614 digital screens across the world in 2008, up 33% on 2007.

The full report can be found on the MPAA web site, which also includes a link to the 2007 publication.

Montage: French film production in 2008; PEVE Digital Entertainment conference; MPAA research 2008

Two items of interest emerged from Paris in the last couple of weeks, beginning with publication by the Centre National de la Cinématographie (CNC) of data showing the strength and vitality of French film production in 2008.

Both the level of production and total production investment rose for the second year running, with the number of films made totalling 240 (up from 228 in 2007), backed by investment of 1.49 billion euros (1.22 billion euros from French sources, an increase of 29% on 2007).

According to a report in Variety, the economic slump had not taken effect by the time most 2008 movies went into production, and historically French film production has proved relatively resilient during financial downturns. Patrick Lamassoure, Film France managing director, is quoted as saying:
"The French production system isn't based on equity. Money doesn't come from banks; it comes principally from TV stations, CNC subsidy coin and minimum guarantees from domestic distributors.”

Last week also saw Paris play host to the annual Screen Digest PEVE Digital Entertainment conference. According to the press release, ‘the home entertainment industry has much to be optimistic about’, despite the economic downturn.

This upbeat assessment is based on facts and figures presented over the two days of the conference, which included a keynote address by David Bishop, President of Sony Pictures Home Entertainment, who noted that home entertainment is a $50bn-a-year business that 'continues to be a critical revenue  stream for our parent companies' and that ‘consumers are still buying packaged media in significant numbers'. 

Screen Digest's Dan Cryan told delegates the biggest challenge they face is in persuading consumers to pay for content that is currently available for free. Piracy is not the only competition according to data presented by Cryan: by 2011, ‘ad-funded, free to view TV shows will account for 10 times more US consumption than paid-for online content. Both pricing and windowing strategies must be rethought...if paid-for content is to compete with free’.

Further details of what sounds like a really fascinating event can be found here.

Finally, Pamela McClintock, writing in Variety earlier in the week, offers some interesting speculation as to why the MPAA’s annual theatrical market data publication has not yet surfaced.

‘So far’, she reports, ‘the 2008 report is missing in action despite the fact that it was a record-breaking year at both the domestic and international box office.’

McClintock suspects the MPAA ‘doesn't want to publicly tout the health of the box office during the economic crisis. Nor does [Dan Glickman, MPAA Chair and CEO] want to give Washington politicos ammunition. In January, Sen. Tom Coburn (R-Okla.) blasted a provision in the stimulus package that would have provided $246 million in tax breaks for studios and filmmakers. Coburn's argument: Why should Hollywood get a handout when the box office is going gangbusters?’

But according to McClintock we won’t have to wait for much longer. The MPAA has confirmed the report is due for publication online following Glickman's appearance at the ShoWest event next Tuesday.

(Now, far be it for me to indulge in my own conspiracy theories, but I note that ShoWest is run by the Nielsen Film Group, part of the Nielsen Company that also owns The Hollywood Reporter, a rival to  Variety...is that what stoked McClintock's interest?).

UK film production in 2008

The UK Film Council has just released figures for the number and value of UK film productions in 2008, along with confirmation of last year’s total box office gross (as reported last week).

As the press release makes clear, these numbers paint a mixed picture: ‘while UK box office receipts reached a record high, film production spend in the UK was down compared with the previous year’.

The box office gross total of £949.5 million for the UK and Republic of Ireland, up 5% on 2007, is the highest since records began in 1989. British films, which include big-budget inward investment features with US studio involvement (like The Dark Knight), shared 31% of cinema takings, the second highest such total in the last ten years (in 2005 it reached 33%).

On the production front, the UK was involved in the making of 111 feature films with production budgets of £500,000 and above in the calendar year 2008, compared with 126 similar productions in 2007.

The amount spent in the UK on these films totalled £578.2 million in 2008, down 23% on the 2007 total of £753.3 million.

(See UK Film Council news release for an explanation of these categories)

But as Table 1 shows, the fall was not uniform across the different types of production tracked by the UK Film Council. Spend on indigenous productions (those made by a UK production company and shot wholly or partly in the UK) rose 22% to £192.2 million in 2008, despite the fact there were two fewer of these films made than in the previous year. UK indigenous films included The Boat that Rocked, Green Zone, Dorian Gray, Me and Orson Welles and 1939.

This is quite an achievement for the indigenous industry, but the UK Film Council offers a bleak outlook for independent British films in 2009. Conditions are expected to be ‘tough with the economic downturn starting to take effect.’

‘This impact had not materialised in 2008 as finance and credit deals are done well in advance of film production and release. The immediate prospects for these British independent films suggest it will become even harder for them to raise credit especially through bank loans’.

The fall in inward investment feature production was due to exceptional factors, notes the UK Film Council, ‘including films being lost or postponed due to the US writers' strike, the exchange rate ($1.97-£1 in June 2008 compared to $1.53-£1 in November 2008), US productions being encouraged to spend closer to home because of US tax incentives, and the effects of the actors' dispute’. 

But on the bright side, 2009 could be a better year for inward investment, ‘due largely to an upturn in the exchange rate which is further enhancing the UK's competitiveness and encouraging the US studios to bring more work to the UK’.

There was another sharp decline in co-production activity in 2008, and the UK Film Council does not expect the situation to improve in 2009, ‘given that the tax break incentivises spend inside the UK and therefore not production outside the UK’. In a related vein, Audrey Ward, writing last week in ScreenDaily, reported the findings of a study by Oxford Economics (OE) warning about the impact of the tax credit on co-production and offshore production activity.

‘[The OE report] points to a loss of around $105m (£70m) in co-production activity and indicates that in terms of UK productions, the tax credit has had a negative effect on UK suppliers. It also warns the qualification criteria promoting the UK "cultural" element of production risks "parochialising" the domestic film industry, damaging international potential.’

According to Ward, the report recommends extending the tax credit to overseas activity linked to UK production. ‘Equivalent systems in Europe and further afield allow nationals to film outside the country.’ One source is quoted as saying,

"If the government would implement this, co-productions would then become viable. The volume of work would return to the sale and leaseback years, the economy would benefit from the additional expenditures, there would be more British people employed, and we would have a vibrant exciting industry again."

The Department for Culture, Media and Sport (DCMS) is currently considering the OE report, and recommendations to ministers are expected in the next few months.