2nd article in our series on Film Industry Implosion.
With the world recession going on, it’s forced us all to tighten our purse strings. No country has been safe and it’s hit all areas of commerce. Even though the film industry brings in billions of dollars, Hollywood has had many loses too. Most notable are MGM’s woes. However many smaller studios have come and gone with little to no news. It’s the same with European studios and other foreign markets, even within their own countries. Hollywood dominates while films made in the respective country lag behind.
So how did this happen? The New York Times published an article by Anthony Kaufman on this topic in January 2006, just a year before the Global Financial Crisis began. In it various industry leaders explain why they think the foreign film market is dwindling. The reasons they give are numerous; lack of good films, reduction in how many films are selected, audiences not liking them as much and preferring US indie films, lack of press exposure they get, foreign talent jumping to English speaking films as soon as they gain recognition, money and documentaries as another potential threat. [1] The writing was on the wall even back then.
With hindsight a few of those reasons the European film market is in trouble. Lack of money and choosing fewer films, (to minimize any potential loss) seems to be at fault which has created a never-ending cycle. US indie films and documentaries are still having the same trouble as foreign films. They are hard to get made and even harder to sell. The talent needed to make the films is also the same. It’s all there but safer films that are known to sell are chosen first, and then are followed by indie films and documentaries. Foreign films are the last chosen and often there is very little space left for them. The lack of money also affects the advertisement. The lack of advertisement means cinemagoers aren’t as aware of the movie, and so they won’t go see it, especially if ticket prices are high to begin with. Then the movie doesn’t bring in as much money as it could. If the movie doesn’t bring in the money, it reinforces to executives that they made the right decision and so the cycle begins again.
So what can be done? One way is to offer tax incentives to entice the US and other countries to bring production to them. This would bring more revenue in that would help boost the country’s film industry. There is also a debate going on about whether or not to apply the free trade pact to cultural industries between the EU and the US. Those who agree think it will open the competition and bring in billions in the areas it is applied too. Those against it say it will destroy the cultural diversity that has developed across Europe. In the last trade pact made in 1993 included “cultural exception” which France introduced to protect its film and TV industry’s cultural diversities. Many other EU member countries have benefited from it. It can be explained better here and here! So when the time came to discuss it again passions ran high! It was a hot topic at this year’s Cannes Film Festival and even has a petition of over 6200 names on it, such as Steven Spielberg, Jane Campion, Ken Loach plus many more well respected industry players from around the world. [2] At least 15 EU countries support too. So far if all goes well with the campaign, film and TV industries have been kept off the G8 summit meetings. [3]
So with progress being made to help keep European cinema from being abused, what exactly are the figures for Europe? Well it still has its ups and downs. There has been a decline in of incoming investment. European films are up but documentaries have dropped. EU film circulation has gone up too. While they aren’t massive improvements, they aren’t massive drops either. American and franchise films still take top spots, but there are some EU films that have done well. [4] It may not be much of a progress but at least it’s a step in the right direction.
[1] http://www.nytimes.com/2006/01/22/movies/22kauf.html
[2] http://www.hollywoodreporter.com/news/european-actors-directors-set-defend-563489
[3] http://www.guardian.co.uk/film/2013/jun/17/film-makers-g8-victory-european-cinema
comicreleaf
comicrelief2
Comic Relief
parisienne
littlebells
Lurker
ozzie20
Open Book
LIH
linkedinhollywood.com 
Ozzie,
The scope of this article is fantastic, yet the topic is so sad. Hollywood really needs competition to assure that they stay on the right track (unfortunately that is in decline as well). Oddly Hollywood isn’t short on competitors yet a receding European film market is still bad in regard to western discussion of world ideas, politics, and culture.
Thank you CR! It is sad but hopefully it’ll recover. I think it’ll take a long time though. 😦
Hi CR & Oz,
I read your research u provided in your article about cultural exception. And I found this statement interesting.
“President of the American Motion Pictures Association, who will remind us – that contrary to what we might think, it is not the American studios who are demanding the destruction of Cultural Exception. No, the problem is home-grown, right here in Europe!”
Why is Europe against Cultural Exception?
I think it’s because some European politicians think that free trade should be applied in all sectors. From what I can gather it would allow countries who signed to trade without restrictions. I think that’s what it is anyway, lol! The European studios and directors fear that other countries will come in, set up studios rather than using theirs and eventually they’ll driven out of business. If that happens it will be very difficult for them to create their films and that country will loose it’s cultural media identity. The exclution would help to keep it. So the argument is between those who want it applied to all areas (usually politicians) and those who want exceptions made (usually the studios but some countries have politicians who agree with them. France is one of them). So it is ourselves who are the “enemy” because any country outside the EU doesn’t get a vote.
Thank u. One more Q
Do u think European studios will loose their cultural identity under this trade?
It’s definately a possibility. Of course we couldn’t know that for sure unless free trade was allowed. It’s like a safety net!
Anyway, it has worked for 20 years (since the last free trade pact). It has allowed smaller and poorer EU countries to boost their own film industries. Unfortunately the global recession hit them hard too so they need to be build back up again.
Hmmm! Very interesting. Thank u!
Sorry I could not be here for the discussion.
Despite my dismay at France’s annual poor display of gender politics at Cannes, I have a hard time forgetting the pivotal l role the country played in film history. If it were to permanently receed as a cultural power I fear for our international or even western ability to comment on the cultural affairs of countries like:
France
Republic of the Congo
Morocco
Canada, (Quebec)
Algeria
Madagascar
Cameroon
Cote D’Ivoire
Burkina Faso
Niger
Ozzie,
“The reasons they give are numerous; lack of good films, reduction in how many films are selected, audiences not liking them as much and preferring US indie films, lack of press exposure they get, foreign talent jumping to English speaking films as soon as they gain recognition, money and documentaries as another potential threat.”
I definitely want to hear more.
Um, I’m not sure if there is more to add but I can do a tired ramble of what I think, lol!
Alot of the reasons they give are interwined. I can understand a reduction as to how many film are made. Due to the recession you need to scale back on the amount you make so any loss won’t be too big of a hit to the purse strings. I don’t think there is a lack of good films. There are plenty out there but if there’s a tiniest chance it won’t make money, they don’t get chosen.
As for audiences not liking them, well they haven’t exactly been given a chance to like them or not! How can they make a decision if what they have to decide on hasn’t been made?! I don’t think audiences are too stupid, or refuse to read subtiltles either. T
he US indie films being more popular excuse I think is because it’s like a US foreign film. Quirky and different from the usual stuff they push out but there’s no subtitles as they speak English! That’s what I think excutives think about them, I have more respect! Still Us indie films are just as marginalized as foreign fims. Documentaries have the same problems too.
As for the lack of press exposure they get, well you’ve got to spend money to make money. If it’s not being advertised properly, no one is going to know about it and won’t see it.
With foreign talent jumping to English speaking films as soon as they gain recognition, well I can’t blame them. Business wise it’s more sensible to do more English speaking but I don’t think they completely abandom their own countries. Once they’re well known, people will check out their other movies. Also most invest the money they make back into their own country’s industry and help promote them too.
You’re so prepared. Thank you so much.
Thanks for the added detail.
Ozzie,
As Bernard-Henri Lévy’s article suggests, I did not understand anti-semetism was an understood negative response to Hollywood overseas.
Ozzie,
“Cultural exception” is a fascinating innovation. Internally, before thinks sink too far, I really think Hollywood needs this mind-set as well.
Lol, I loved those!
Ozzie,
Please be honest, what’s happening in Europe sounds bad but business is booming in China, India, and Nigeria. What’s really happening globally?
Honestly, I’m not sure. I stuck researching to European figures!
Ozzie,
I’m sorry, the more I read the better the picture sounds. Yet you and critics must be focusing on aspects of this problem that may be difficult to see stateside. By many people’s standards Europe is doing extremely well?!?!
Wikipedia says that…
• The United States and Canada made $10.8 billion in 2012.
• China made $2.7 billion in 2012.
• Japan made $2.4 billion in 2012.
• United Kingdom made $1.7 billion in 2012.
• France made $1.7 billion in 2012.
• India made $1.4 billion in 2012.
• Germany made $1.3 billion in 2012.
• South Korea made $1.3 billion in 2012.
• Russia made $1.2 billion in 2012.
• Australia made $1.2 billion in 2012.
• Brazil made $0.8 billion in 2012.
Together, the United Kingdom, France, and Germany may not be competition for North America but their combined might overpowers China; the second place winner world-wide. And as I suggested later on the page they’re language super powers the world over. Shouldn’t people be more optimist in the European Union.
What am I missing? You have probably already said, but you’re helping me focus on the most important criteria.
http://en.wikipedia.org/wiki/Film_industry
Hello Everyone!
Ozzie!
The reasons given
“lack of good films, reduction in how many films are selected, audiences not liking them as much and preferring US indie films”
How do they determine what are good films vs. not? What is the criteria?
Is it that European audiences like US indie films better?
Personally I think it’s an excuse that some executives use to justify not chosing to back foreign films. I think audiences, not matter where they’re from like main stream, indie, foreign and other genres of films just fine. How those excutives define good movies is whether they will make money. I hope that makes sense!
Yes! It does.
Hi everyone! 🙂
Hi Ozzie!
Hello OB! I’m in slow mode tonight so replies may take awhile.
No problem take your time.
Ozzie
“At least 15 EU countries support too. So far if all goes well with the campaign, film and TV industries have been kept off the G8 summit meetings.”
How’s the campaign going?
As of mid June, good! Fortunately France is leading the campaign which gives it more gravitas. France has the 3rd largest admissions and revenue is the world plus both politicians and studios are in agreement. The UK politicans are doing their typical umming and ahhing. *insert eye roll* So far UK studios have managed to persuade the politicians to agree with the exception. They better keep it that way as we have some very good studios here. It wasn’t till I was researching for another article that I found out alot of big main stream films are made here!
“It wasn’t till I was researching for another article that I found out alot of big main stream films are made here!”
What are those Films & studios?
Here you go! Just scroll down, it lists the movies made there.
http://en.wikipedia.org/wiki/Elstree_Studios
http://en.wikipedia.org/wiki/Pinewood_Studios
http://en.wikipedia.org/wiki/Shepperton_Studios
It will always be Leavesden Studios to me! ALWAYS!
http://en.wikipedia.org/wiki/Warner_Bros._Studios,_Leavesden
Ozzie- This is fantastic thank u. It seems like every studio got a chance to work on Harry Potter or am I wrong?
Looks like it apart from Elstree. Leavesden was used for principal photography, the others were used for second locations I think.
Ozzie,
I promise, I’m going to wind down the questions. But your last comment begs the question:
England is enormously influential worldwide. How can it be failing when they are responsible for so much of North America’s content and development?
Why doesn’t the United Kingdom have more confidence in their own contribution to world cinema when world audiences are clearly sold on their work?
• The actors are sought after everywhere.
• Though they don’t appear to be well-distributed, the directors seem to be genius’.
• And in all areas of production they appear to set trends in and outside of the industry.
I’m sorry Ozzie, your article may be making me crazy.
Ozzie,
I have to go but this was a very informative article and discussion. Again great, research.
I will have to come back tomorrow.
Paris, sorry we missed u. Hopefully I will get things fixed for u.
Goodnight all!
Thank you! I’ll be back again also. Nighty night to all! 🙂
Ozzie,
Thanks for your patience.
But this article presents so many paradoxes that for some reason I can’t let go of.
World cinema is necessary in that it informs so much of what we know of film but it also highlights what we don’t know in terms of international perspectives.
• When I discussed China, India, and Nigeria, I did not mention that war torn Egypt I did not realize how influential this Islamic country is as a world leader in international film.
• I mentioned China but neglected to mention other Asian countries like Japan and South Korea that also have incredible industries also.
• Mentioning every other international continent I forgot to mention Brazil’s dynamic industry.
Regardless, you detailed why the international recession was bad for all industries. Thank you this helps us understand how the health of economies impacts our ability to speak and represent ourselves in film. Yet I’m curious as to what you believe are the most positive world film events and would you please express why you think they are important or will be to European film? I know this is asking a lot, but it’s hard to believe that you don’t have a perspective on this.
Again you may have already said, and if so I am sorry.
Again thank you so much for being so gracious and accommodating.