global screen production the impact of• the global screen production report provides a robust...
TRANSCRIPT
Global Screen Production –The Impact of Film and Television Production on Economic Recovery from COVID-19
Best Practice in Screen Sector Development
FICCI FRAMES webinar10th July 2020
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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About the Study
Introduction
• The Global Screen Production Report analyses the impactof film and television production on economic recovery from COVID-19
• It begins by identifying, for the first time, the size and economic power of the world’s film and television production (“Screen Production”) sector
• It also describes the sector’s particular importance in helping distressed economies recover in the wake of the COVID-19 pandemic
• This independent study has been researched and written by Olsberg•SPI with support from Media Business Insight and Netflix. The study is endorsed by these leading film commission associations and networks, representing intergovernmental bodies around the world
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Screen Production delivers a suite of economic benefits
Introduction
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SCREEN PRODUCTION
Drives Economic Activity –
measured by GDP or GVA Highly Skilled,
Productive, and Less
Displaceable Employment
Net Inward Investment
Capital Investment in Supply Chain
and Infrastructure
Positive National
Branding / Soft Power
Screen Tourism
Drives Economic Activity in Adjacent Creative
Industries
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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The Scale of Global Screen Production
• Until the COVID-19 pandemic occurred, growth in Screen Production had been ground-breaking.
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In 2019, global expenditure on Screen Production reached a new high watermark of $177 billion
$177bnGlobal
Expenditure on Screen
Production
Gross Value Added $414bn
14mFTE jobs driven by
Screen Production
• The USA invests around 65% of the total global Screen Production expenditure
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Sources of global Screen Production investment
The Scale of Global Screen Production
• However, 0nly 40% of USA Screen Production investment occurs in the USA, with all other regions of the world benefitting from this funding
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Where global Screen Production expenditure takes place
The Scale of Global Screen Production
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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The Speed of Impact
• Analysis of several actual film and television budgets show how quickly the economic impact of Screen Production is delivered
• For example, a major $220 million budget film shows that an average of $10 million per week was spent during the 16-week shoot.
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Screen Productions inject huge amounts of capital very rapidly Major Film Weekly Cashflow ($220 Million Budget)
• Given this demonstrable power of Screen Production to deliver substantial spend in a short space of time, it is recognised as a powerful sector for driving economic recovery in many territories
• Screen Production projects are likely to be a faster option for kickstarting economic recovery than many other industries and sectors of the economy that are often promoted as stable
• The length of the Screen Production supply chain also means that any measures to support the sector will benefit the wider economy
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Screen Production is likely to be a faster option for kickstarting economic recovery than most other sectors
The Speed of Impact
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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Benefits for the Wider Economy
• On average, 67% of below the line production costs are spent in business sectors outside of Screen Production
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Screen Production investment positively impacts other areas of the economy
Proportion of Production Spend in Other Business Sectors by Project Type (%)
33.1
12.2
11.2
6.7
8.1
6.6
5.6
5.5
5.13.5
0.8 0.70.6
0.5Screen Production Specific
Business Support
Construction
VFX & Interactive
Travel & Transport
Hospitality & Catering
Finance & Legal
Real Estate
Fashion & Beauty
Music & Performing Arts
Power & Utilities
Safety & Security
Training & Education
Health & Medical
• The example low budget feature below shows how expenditure is spread around the economy
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Supply chain analysis of a low-budget film
Benefits for the Wider Economy
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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• The COVID-19 shutdown has resulted in a loss of $145 billion in economic impact over in the first six months of 2020 and 10 million global screen sector value chain FTE jobs
• However, unlike other areas of the economy whose recovery could take years (e.g. publishing, construction, real estate), Screen Production has many attributes that give it a leading position in stimulating recovery
• Governments have already identified this: Screen Production is seen as a key component of economic recovery, and many have created measures to encourage production to restart (see examples in next slide)
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Recovering from the Screen Production Hiatus
Public measures to support the restart of Screen Production are likely to have a quicker impact than other sectors
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Recovering from the Screen Production Hiatus
Examples of public measures to stimulate the recovery of Screen Production
State-backed insurance for independent Screen Production
France
The early release of development money to help ensure progress of that projects in the pipeline
Sweden
Increasing the % of incentives offered to stimulate production
Greece
Making costs relating to shut-down eligible expenses for incentive schemes
Austria
Temporarily reducing taxes such as VAT on production costs
China
Exempting cast and crew from standard quarantine requirements for foreign travellers
Iceland
Economic measures to support freelancers in the cultural sphere to ensure that they can remain in the workforce
United Kingdom
Accelerating payments due to independent production companies to address cash flow needs
Poland
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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• The Global Screen Production Report provides a robust demonstration of the global economic power of Screen Production
• It examines the sector’s potential to assist economic recovery in the wake of COVID-19
• It shows how maintaining and encouraging Screen Production at a national, regional and local level is one of the solutions to rejuvenating economies across the world
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Conclusion
Summary of findings
Contents• Introduction
• The Scale of Global Screen Production
• The Speed of Impact
• Benefits for the Wider Economy
• Recovering from the Screen Production Hiatus
• Conclusions
• Best Practice in Screen Sector Development
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• The scale and global nature of the growing Screen Production presents a major opportunity for countries and regions to service demand by investing in production capability and capacity
• Against this backdrop, the Association of Film Commissioners International (AFCI) commissioned Olsberg•SPI to undertake an assessment of best practice in screen sector development
• The study identifies a range of successful strategies and policies utilised by countries that wish to maximise their share of lucrative production activity
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Introduction
In 2019, SPI published a study into the best practice in screen sector development
• For the purposes of the study, best practice is assessed within four key, inter-related categories.
• These are inter-related: successful production sectors are cohesive ecosystems and it is important that consistent and holistic development is undertaken
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Key Best Practice Areas
The study considered four categories of best practice
4. Film-Friendly Production Environment
3. Capacity Building in Infrastructure and Services
2. Workforce Capacity
1. Automatic Incentives
Formal Best PracticeLegislation, policies, strategies and funding to increase capacity
and quality
Informal Best PracticeProcesses and procedures that reduce difficulties and friction for
film-makers at all points during the production process
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Defining Best Practice
Overall policy considerations are the cornerstone of best practice
Best practice in the four study areas relates to an ultimate intention of maximising production activity in a given jurisdiction
Many of the interventions identified relate to both the attraction of international projects and the development of national production
Well-designed policy, legislation and strategy is a cornerstone of best practice, for example tax, company and employment law, visa processes, customs, intellectual property, and censorship
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Key Areas of Best Practice
Automatic Incentives
Design and Formulation • Structure and process should be straightforward• With as few complications as possible• Using a well-understood and tested model such as a cash rebate
Legislation and Guidelines • Clear and transparent• Lack of subjectivity• Without onerous additional requirements such as rights obligations or unrealistic promotional requirements• Timescales should be clearly outlined
System Administration• Process should function predictably and as described in the guidelines• Administrators should be responsive to producers and advise potential projects on access to the incentive
Payment• Incentive budgets are ideally uncapped • Payment not dependent on the originating producer sharing rights• Pay to either a local or international producer, but must be without delay
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Key Areas of Best Practice
Workforce Development
Understanding Need• Effective development depends on meeting industrial requirements• Research into identifying particular skills gaps
Cohesive and Holistic Strategy• Multiple stakeholders across the public and private spheres• Strategy must be informed by the need for international production to use standard structures and roles across borders
Tracking• With a strategy in place the needs of the industry should be robustly tracked on an ongoing basis to ensure a sufficient pipeline of skills and workers
Targeted Interventions• Effective workforce strategies benefit a wide range of trainees across different positions while targeting specific skills gaps in higher grades
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Key Areas of Best Practice
Infrastructure and Services
Stimulating Investment• Studios are a key area of need in many markets • Government investment is a key intervention• Includes direct and indirect financial support - e.g. through research on demand to inform investors
Market Stability• Authorities also have a key role in ensuring a stable market through a predictable production incentive with a long legislative sunset date
Incentives• Can be formulated to encourage infrastructure development • E.g. through added incentive value for productions using specific facilities, or by offering added value to producers who also invest in infrastructure
Cohesive Ecosystem• It is important that the development of infrastructure is linked to a broader market development strategy – particularly with regards to building workforce• Studios in particular can play a key role in developing skills
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Key Areas of Best Practice
Film-friendliness Holistic Creative Industries Policy Approach• Screen policy works best when it is part of a broader set of long-term policies created to support the creative industries as a whole
Permitting• Facilitating filming is essential in helping to provide the most film-friendly environment possible• Permits must be straightforward and quick to access, without onerous considerations
Consensus and Communication• A shared positive view of the industry across a range of different government depts, agencies, and other entities• Effective communication of positive production impacts is important• Film commissions can take the lead here
Immigration, Customs and Tax• Screen production utilises international labour, talent, and filming equipment • Related processes and legislation need to be as simple and streamlined as possible
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Report Links
To download the Global Screen Production Report or the Best Practice In Screen Development Report visit the links in this page
To download the full study, visit: afci.org/research-best-practices/
To download the full study, visit: o-spi.co.uk/recent-reports/
