I was lucky enough to give a lecture at the University of Paris recently where there were lots of really interesting speakers talking about film policy in France, Australia and the UK. I was struck by the historical trends of institutional flux that accompany support for film. These continue today at a continental level with the advent of Creative Europe and closer to home in London and Edinburgh with debate over the funding of a national film industry, often concentrating on production finance.
The institutional environmental uncertainty is mirrored by the digitally disrupted, structural-economic organisation of the independent industry overall. And there is a pressing need to ensure that approaches to public finance are interwoven with detailed understanding of the affordances of digital technology and the data it throws off. As Gillian Berrie, founder of Film City pictured above (credit Davy Scott), and Sigma Films noted in speaking to the Scottish Parliament, a film investor needs to have a strategy. Such a strategy must go beyond surface level debates of e.g. making more films (a given), to identify how specific goals can be achieved in a digitally disrupted environment.
As Hasan Bakshi, economist at Nesta points out, evaluation is an inescapable reality of investment. The proliferation of what I term Digital Engagement Metrics (DEMs) (e.g. those analysed for Hunger Games) is dominating industry literature, in film and media . However, developing an understanding of interdependence between the fundamental dynamics of film revenue distribution and what can be known from digital engagement and the resources required to develop such knowledge, seems to be underserved in debate.
Fundamental film industry features can be summarised as: non-linear dynamics, skew and kurtosis, infinite variance, revolution around a stable Paretian model, volatility, information inequality and self-similarity (De Vany 2004). And David Steele at BFI has recently pointed out the 7% profitability rate for UK films points to portfolio decision making, which De Vany would agree with if applied as a slate-wide greenlighting policy. But this state of affairs is unlikely, few market actors have the scale and strength to work in this way. What more producers/distributors are currently beginning to pursue in the hope of reducing uncertainty is to trial new models of release, including VOD and manage them partially through DEMs.
These are great developments, but when institutional funders, hopefully set out their strategy, they should take into account exactly where causal gaps in digital traces exist and plan to accommodate data management resources that can deal with both the current state of affairs and for what theywant to understand in the future. The Media Industries Project at UCSB gives a nice illustration of the potential trip ups in media metrics, and these complexities must be wrestled with as digital measures of success and linkages between DEMs and revenue continue to be constructed and relied upon. E.g. for documentaries pursuing the social impact that public funding is expected to deliver.
One approach is to unify means of marketing and distribution (often adopted in transmedia) as far as possible and thereby capture a segment of the audience conversion to purchase relationship e.g. as Distrify are pursuing. This is especially important in a global market where traditional segmentation of rights and therefore generation of finance is under threat e.g. territories in Europe, and there is such tension between market actors.
So these are interesting questions, and I look forward to working on them in 2014. In particular I will be addressing role of digital engagement in film investment, managing film distribution via Social Network Analysis and evaluating DEMs returns. I am most grateful to my clients Sigma Films and SDI at the Edinburgh College of Art, University of Edinburgh and of course to ICC, for these opportunities.