The International Film Business

A Market Guide Beyond Hollywood

Angus Finney

• Publisher: Routledge
• Year: 2022
• ISBN:
  9781000552003
• Edition: 3
• Topic: Medien & darstellende Kunst
• Subtopic: Film & Video

Examining the independent film sector as a business on an international scale, author Angus Finney addresses the specific skills and knowledge required to successfully navigate the international film business.

Finney describes and analyses the present structure of the film industry as a business, with a specific focus on the film (and entertainment) value chain and takes readers through the status of current digital technology, exploring ways in which this is changing the structure and opportunities offered by the industry in the future. The textbook provides information and advice on the different business and management skills and strategies that students and emerging practitioners will need to effectively engage with the industry in an international context. Case studies of films and TV, including Squid Game (2021), Parasite (2019), Game of Thrones (2011-2019) and The Best Exotic Marigold Hotel (2011), are supplemented by company case studies on Redbus, Renaissance, Pixar, with additional new chapters focusing on Netflix, TikTok and the Metaverse.

This third edition of The International Film Business includes up-to-date information on the status of the international film industry during and post COVID-19; expanded content looking at the TV industry and streaming services; new case studies and dedicated sections on the Streaming Wars and the Chinese Film Industry and a new chapter looking at the changes in digital production in the context of the global and territorial film and TV industry.

Written for students of Film Business and emerging practitioners, this book will take readers through the successes and failures of a variety of real film companies and projects and features exclusive interviews with leading practitioners in all sectors of the industry, from production to exhibition.

Part I The film value chain

1 The winds of change

DOI: 10.4324/9781003205753-2

The future is already here; it’s just not evenly distributed.

(novelist William Gibson)

I have a living room … I want to go to the theatre.

(Quentin Tarantino, 2021) [1]

Changing gears

Over the past one hundred years and a few more rather lively ones of late, a multitude of challenges have threatened to kill off the film industry. Cue the headlines: World War One, the ‘Spanish Flu’ epidemic; the arrival of ‘talkies’; World War Two; the arrival of post-war television in the living room; the invention of video in the 1970s; the explosion of the internet in the 1990s; the 2008 financial crisis; and, most recently, the onslaught of a worldwide pandemic in early 2020 that is still very much present at the time of publication. The blinding speed of change over the past five years has been predominantly driven by what I and others term “the streaming wars”. Intense competition is shifting the film and content industry from natural evolution to radical revolution (and increasingly onto smaller screens, ‘wherever you are, whenever you want’), thanks in part to the impact and ongoing presence of the Coronavirus epidemic. And yet despite blow after blow (real or imagined), film and moving images have proven remarkably resilient and are still coming “to a cinema near you” or, more likely today, at a screen near your eye level.

Believers argue that as the film medium and industry rises above each challenge, it becomes stronger than ever before. “What we thought was going to happen in four years, it’s now happened in one”, gushed one digital production specialist in the timely Future of Film report [2]. Others bemoan the closed cinema theatres of late and issue the death rattle for “cinema” as we have known it over the past (albeit ever-shifting) century. The naysayers are ignoring some key “known knowns”: our collective human appetite for stories, content and meaning is insatiable, especially in times of political turmoil and insecurity about today and tomorrow, let alone the near-distant future. Millions around the globe clearly desire to escape on a daily and hourly basis; many still yearn for the shared experience of the big screen. Filmmaker and author Jon Boorstin explains: “Size is crucial. The voyeur in us must feel life encompassing the story, swallowing up the screen. We need spectacle, sweeping panorama, to convince us that the world out there is beyond the edge of the frame” [3]. Critically, people around the world continue to want to be entertained; and that includes being challenged, surprised and inspired. As Nigerian award-winning novelist Ben Okri points out: “Stories are the highest technology of being” [4]. And critically, people remain subtle and yet fickle: most rarely do we know what we want to watch until we actually see it.

The overall stakes as both a worldwide industry and a global business are high. The total economic impact of the entire screen sector in 2019, just prior to the onset of COVID-19, was some $414 billion, and global expenditure on Screen Production was $177 billion (including scripted film, TV/streamed content and documentaries, but not sport, news and commercials) [5]. In a wide-ranging study by OlsbergSPI [ibid.], the writers made a convincing, heavily evidence-based case for governments around the world to embrace and support screen production as a key economic driver in the post-COVID-19 recovery. At the time of writing, the pandemic-created production pile-up resembled a line of packed Jumbo Jets tailed back on an overcrowded runway. But gradually the pace of lift-off will accelerate inexorably, given the demand for content around the world.

The three-legged chair: creativity, technology and leadership

Producer and statesman Lord Puttnam observed a decade ago: “The change is enormous yet nothing is changing” [6]. Film is an ideas-driven business: “The notion that the audience wants a satisfying emotional experience, a reconciliation and completeness, has not changed.” Much of this book examines and delves into the heart of the creative responsibilities and endeavours of project managers – namely ‘producers’ – while noting the importance of the writer–director–producer “creative triangle” [7]. A wide range of case studies, including Game of Thrones, Pixar and Parasite, provide insights into the creative challenges facing content makers, but also bears witness to the extraordinary ability of talent to win out against the toughest tests. Filmmaking is akin to “carrying water up a hill”, as one award-winning South African producer reminded me in Johannesburg during the countless pre-lockdown(s). And many of those water-carriers are not operating in the limelight, under the starry strobes of Awards seasons and prime-time attention. The majority of the professionals interviewed for this new edition (effectively a completely new book) work at the essential coal face of the business, and, in their own special ways, bring a level of creative sophistication, problem solving and cultural insights so often taken for granted or missed completely by the media and sometimes the very talent they are supporting and willing on to greater endeavours.

Technology: changing winds

To understand where we are now, we need to understand what has gone before, and the anthropological impulses that invariably act as breaks on change, whatever form(s) that may take. The generational process of ageing populations (and certain governments) deciding what’s good for their offspring (and citizens) is timeless, and is normally driven by a combination of ignorance, protectiveness and fear. The process of declining acceptance of all things new as we grow older was enshrined by the writer Douglas Adams, when he came up with a set of rules in his novel The Salmon of Doubt [8], that pinpoints our changing reactions to technologies.

Adams’ three rules are:

1. Anything that is in the world when you’re born is normal and ordinary and just a natural part of the way the world works.
2. Anything that’s invented between when you’re 15 and 35 is new and exciting and revolutionary and you can probably get a career in it.
3. Anything invented after you are 35 is against the natural order of things.

Writing in The Guardian, the newspaper’s technology specialist John Naughton cited Ben Thompson’s work on how best to understand and analyse the advance of technology [9]. Thompson suggests that we think of the industry in terms of “epochs” – important periods or eras in the history of a field. At that point he saw three epochs in the evolution of our networked world of tech, each defined in terms of its core technology and its “killer app”.

Epoch one was the PC era, kicked off in 1981 as IBM launched its personal computer. And the killer app was the spreadsheet. The film business’s equivalent was the culmination of what cinema author Peter Biskind wrote so masterfully about in Easy Riders, Raging Bulls, at time in the 1970s when auteurs had dominated Hollywood and the theatrical box office [10]. Meanwhile the VCR had long been born, marked by VHS beating out Betamax in the mid-1970s and winning the living room tape wars (ironically won by the lowest-quality bidder).

Epoch two was the internet era, which began 14 years after the PC epoch began, in 1995. The core technology was the web browser – the tool that turned the internet into something that all of us could understand and use. The ‘search’ (driven by the engine) was the killer app and the dominant use came to be social networking, with market share being captured by the ubiquitous Facebook.

And the film industry’s equivalent? The advent of the Digital Versatile Disc (DVD) in 1997, which further transformed the living room experience, while arming distributors with a license to print money, given the huge margins on offer. Indeed, profits from the deep well of ancillary riches was so addictive that it subsequently became hard for studios and distributors to wean themselves off those now-disappearing drugs. Meanwhile digital filmmaking and the gradual demise of 35 mm was also cutting a swathe across mainstream film production and projection.

Epoch three in Thompson’s framework – the phase that we’re experiencing now – is what he deems the “mobile” era. It dates from 2007 when Apple announced the iPhone and launched the smartphone revolution. Naughton suggests that the killer app is the so-called “sharing economy (which of course is nothing of the kind), and messaging of various kinds has become the dominant communications medium. But now it looks as though this smartphone epoch is reaching its peak” [ibid.].

The film industry’s third epoch over the past 40 years? No doubt the start and rapid rise of streaming – driven by digital and online technology and a desire to reach audiences/users/customers/members wherever you are. And that is a key part of the fresh focus of this book: how people’s habits are changing, how we make choices about our screen and leisure time, and how the fight for attention and loyalty (see Chapters 16 and 17: The Streaming Wars; and Netflix case study) is driving an explosion of content and material, not all, inevitably, impactful or as well aimed as intended. Movies, drama and ambitious series are extremely expensive gambles. “Producers … might want perfection, but they are asking themselves a much cruder question: how does this thing need to work? What is the X factor that it must contain that will forgive a thousand blunders?” [11]. And the overriding challenge today is to not just embrace but to lead with genuine inclusion: “Audiences need to be able to see people like themselves in films, they need to be able to see people like them making films, otherwise they will just think it’s not a place for them”, explains Delphi Lievens [12]. Her viewpoint is supported by the vastly successful Jason Blum, who underlines the point:

I really believe that you want the storytellers to look like the audience they’re telling stories for: And that’s what we’ve done and will continue to do.

[ibid.]

Which brings us to the advent of the fourth epoch and the future landscape. In this so far phase without end, some commentators and Silicon Valley titans are heralding the arrival of the metaverse(s), comprising a mass virtual reality world where, for example, the children of tomorrow will have “friends” with a range of virtual influencers without even thinking of how they might differ to their mates living down the road. And as a writer far beyond the age of 35 (even before the first edition of this book was published in 2010), I was forced to confront my own prejudices by teaming up with digital entrepreneur James K. Wight. A curious and highly engaging 20-something whom I taught at Exeter University and the London Film School, Wight patiently talked me through the decline of Facebook, the rise of TikTok, the wider virtual world and an introduction to the metaverse(s). The result is enshrined in Chapter 20 in an effort to try to better understand the order of things now and tomorrow.

Leadership out in front

Students and academics are often guilty of assuming management and leadership amount to one of the same thing. They do not. Whilst management – a key theme analysed continuously throughout this book (including project, creative, business etc.) – is a vital skill set for the creative industries to thrive, the international film business would die on the sword without genuine leadership on the front line. Perhaps the most impressive and profound book I came across in researching this third edition did not originate from the entertainment world beyond Hollywood. Instead, Disney’s Bob Iger’s “Ride of a Lifetime: Lessons in Creative Leadership…” [13] struck home to me. Most impressive of all is his understanding of what is required to make and see through genuine change, as he reflected on the advent and auspicious rise of Disney +, and the leadership that was required to make it happen:

Too often, we lead from a place of fear rather than courage, stubbornly trying to build a bulwark to protect new models that can’t possibly survive the sea change that is underway. It’s hard to look at your current models, sometimes even ones that are profitable in the moment, and make a decision to undermine them in order to face the change that’s coming.

[Ibid]

And so to the capture of knowledge, through collecting, analysing and utilising industry experience and practice: very much the centre of this book’s overall purpose. In theory, armed with vast levels of data and digital advancements, we should be embracing a new powerfully reflexive world of magical engagement. However, rather more home truths, feedback loops and authentic sharing would go a long way to securing an industry fit for purpose as the wind blows us into a fourth epoch, the results of which we can only wonder.

References

1. Quentin Tarantino, quoted in the Armchair Expert podcast, Financial Times, 28–29/08/21.
2. Jon Boorstin, The Hollywood Eye. Harper Collins, 1990.
3. Ben Okri, The Mystery Feast: Thoughts on Storytelling. Clairview Books, 2015.
4. Stolz, A., Atkinson, S. and Kennedy, H. W., Future of Film Report, 2021.
5. Global Screen Production, The Impact of Film and TV Production on Economic Recovery from COVID-19: A Study by OlsbergSPI, 25/06/2020.
6. Lord Puttnam was talking at the Ffilm Cymru conference in Cardiff, Wales, 2013.
7. Peter Bloore, The Screenplay Business. Routledge, 2013.
8. Douglas Adams, The Salmon of Doubt. Heinemann, 2002.
9. John Naughton, ‘PC, internet, smartphone: what’s the next big technological epoch?’ The Guardian, 11/09/2021.
10. Peter Biskind, Easy Riders, Raging Bulls. Simon & Schuster, 1998.
11. John Boorstin, The Hollywood Eye. Harper Collins, 1990, p. 135.
12. Delphi Lievens, Future of Film Report, 2021.
13. Bob Iger, Ride of a Lifetime: Lessons in Creative Management from 15 years as CEO of the Walt Disney Company. Bantam Press, 2019.

2 The film value chain

DOI: 10.4324/9781003205753-3

The essence of strategy is choosing what not to do.

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