I recently enjoyed the good fortune to be invited to the launch of the Make Your Market scheme. This is an industry initiative delivered by SDI and We Are Tonic focusing on developing and implementing new models of film marketing, distribution and audience engagement.
One discussion of particular interest concerned exhibition and the powerful success, both cultural and financial of alternative content / event cinema, as excellently presented by Penny Nagle of More2Screen.
The long lead booking of, consistent demand for, and surfeit of high quality content in this non-film sector presents exhibitors and public bodies with a challenge, as well as the noted benefits of serving local communities and solid box office returns.
The BFI, who fund some event releases and the BFI hub networks who look to engender a greater cinema-going culture, are also part of an institution responsible for the development of indigenous production.
One impact of event cinema’s success, which was debated through Film London’s Build Your Audience Scheme last year, is the restriction of screen capacity for independent film. For independent exhibitors the choice to show guaranteed full house screenings of e.g. a Royal Opera House or NT Live production, and move a mini-major release e.g. Wes Anderson film to a smaller screen is clear. In the context of smaller UK independent films this choice further denudes such films of attention as the more well known content pushes them out of the cinema (presumably having forgone the chance to be in major cinemas due to breaking windows). Thus the Digital Screen (not quite) Network becomes another choked pipeline for an ever increasing amount of content, desperate for an audience and probably likely to lose money. So what should the BFI, its affiliates and national / regional bodies do to address the issue? Screen quotas, guaranteed BFI Player / national film theatre releases? It is an enduring problem, the debate between market leadership and paternalism / arts patronage continues.
This tension is no new revelation, but I mention it as it provides a point of current industry debate for reference in relation to the public press releases of statistics foregrounding UK films’ strong box office market share (11% – the 3rd highest on record). Does this relatively healthy theatrical performance negate the issue set out above, that the UK market is an increasingly difficult environment for local independent filmmakers?
Rather than illustrating conflicting interpretations, a little consideration shows that current events are emphasising enduring characteristics of the industry, characteristics which still require attention.
The relative historical strength of UK independent film at the box office is not incompatible with the squeezing of opportunities for films to be seen, rather, as per the fundamental dynamics of revenue distribution a few hits account for the vast majority of the box office – it is volume of ticket sales that drive the state of affairs, not a wide diversity of available titles (though the 8 titles taking more than $7m each is a noted improvement in spread).
In 2015 the popular titles include Legend, The Second Best Marigold Hotel, The Lady in the Van, Shaun the Sheep, and Suffragette.Whilst the BFI differentiate those titles from official studio-backed films, when one looks at the companies involved in producing, financing and distributing these films, it is hard to argue that the majority of returns won’t be appropriated away from the UK independent industry. Legend is a Working Title production financed via Anton Capital Entertainment’s slate deal with distributor StudioCanal – who also financed Shaun, Marigold involves finance by Participant and was released by Fox. Whilst UK film’s backbone public funders are responsible too (Suffragette / Film4; Lady/ BBC), the companies potentially in best position to extract maximum returns are non-UK: TriStar / Sony and Focus / Pathe (in conjunction with Ingenious – a notable UK exception). Thus the “golden age of British film” may not extend to its film businesses, rather its practice.
Undoubtedly the producers of such films should be celebrated, and their operations considered, most have adapted to the inherent extreme uncertainty in the film industry by diversifying their output into TV. Working Title & Aardman operate on a significant financial scale, having entered long-term agreements with US companies.
Ruby and Blueprint’s latest accounts show a diversity in corporate financial results – one posting negative total net assets (liabilities) the other reporting assets over 800k on the balance sheet – but the overall takeaway should be drawn from putting the immediately visible British film company success (as heralded in the press) into historical context. From a first, and very superficial, surface sketch of those involved with 2015’s most successful independent films, evidence of retained economic benefit in the sector is minimal.
Indiewire commented “Based on these new statistics, it looks like the UK film and television scene will have to work extra hard to keep the momentum climbing” but in essence is there anything really different going on, the British industry’s talent and commitment are perennial, the major financial inputs to the landscape surveyed are automatic mandates: the tax credit and the involvement of public funding. What continues to be missing is a substantial private appetite for risk and the capacity to retain its rewards within UK firms. As the bankruptcy trial of Relativity Media shows, there is no magic formula for accurate revenue prediction and thus IP valuation to attract greater and more stable levels of investment. In fact, valuation is increasingly more difficult as ancillary windows continue to suffer flux, disrupting future earnings models. It is likely that an understanding of significant and long term benefits to British Film requires all aspects of the value chain to be taken into consideration, not silo-ed separately into Box Office, exhibition capacity, production spend etc.
Photo credits to the SDI Team.