MACRO ENVIRONMENT OF SRI LANKAN FILM INDUSTRY

Group 04

Group MembersSAJITHA ADIKARI HD-UGC- 102002

LALINDRA DE SILVA HD-UGC- 102016

NISAL DHARMADASA HD-UGC- 102021

AYESHA FERNANDO HD-UGC- 102027

SACHINI PERERA HD-UGC- 102067

SEWMINIRATNAYAKA

HD-UGC- 102070

Group Members

Introduction

Macro Environment Of Film Industry in Sri Lanka

The major external and uncontrollable factors that influence an organization’s

decision making, and affect its performance and strategies. A PESTEL Analysis

is undertaken to understand the dynamics of the external environment which the

film industry operates in. These factors include the Political ,Economic, Socio-

Cultural, Technological, Ecological and Legal environment.

Major Macro Environment Factors

Political

Environment

Economical

Environment

Socio Cultural

Environment

Technological

Environment

Ecologica

l Environment

Legal

Environment

Sri Lankan Film Industry Sri Lankan Film Industry was established in 1947 with “ Kadawnu

Poronduwa” produced by S.M. Navagam of Chira Kala move tone.

The pioneer director Lester James Peris was the first Sinhala film

director who shot his first film completely out of the studio “Rekava” in

1956

During the 1970 several valuable films came to the film industry, such as

Gamperaliya, Nidhanaya, Gaga addara, Prasathumal and Kaliugaya.

In the recent years, the film producers such as Wasantha Obesekara,

Darmasena Pathiraja, Tissa Abesekara, Prasanna Vithanage and Asoka

Hadagama were become the leader in the film industry

Today, film industry produced by classical films and commercial films.

Most of the Sri Lankan films were participated by International film

festival and won the more awards.

Political Environment The Political environment consists of laws, government agencies and

pressure groups that influence or limit various organizations and

individuals in a given society. Marketers must keenly follow the

changing sociopolitical environment of the world in order to seek out

opportunities and to address potential threats. Political stability is one of the fundamental aspects for any industry’s

success and growth. With the end of terrorism in Sri Lanka, the North and East areas

opened up. The government should take action to build cinema halls to help develop the industry for the Tamil community. This is a new audience which Sri Lankan Tamil directors can make films for. Thus, the government should take initiative to develop the industry in the North.

With the positive economic growth (8%) in the country there is clear potential for the film industry to grow and prosper. But, it is hard to achieve its potential without funding and support from the political arena.

Opportunities in the Political Environment of Sri Lankan Film industry

Sri Lanka has many undiscovered beautiful locations and these can be marketed for foreign productions.

  It is also advantageous for foreign films to shoot in

Sri Lanka because it is less costly. However, if Sri Lanka intends to earn an income and learn through foreign productions, it is the government’s responsibility to see that Sri Lanka maintains a good global reputation by maintaining a stabilized political environment.

Threats in Political Environment of Sri Lankan Film industry

Politics should not interfere with the screening of films. For example, some movies which are done by people related to politics screen their films without giving consideration to the lineup of films.

The treats are minimal as long as keep everyone satisfied.

Economic Environment The totality of economic factors, such as employment, income, inflation, interest rate,

productivity, and wealth, that influence the buying behavior of consumers and

institutions.

Latest changes in Economic Environment of Sri Lankan Film industry

Sri Lankan government got more benefits by the IIFA film festival

Attracting more foreigners

Increased amount of foreign exchange

Starting new business

To develop their business relationship and friendship

To improve the infrastructure in Colombo city

To get more investment opportunities in Sri Lanka film industry

The Sri Lankan enterprises can be take our cinema to international heights and that is

why the President has formulated tax benefits to elevate the national cinema to enter

into the global film market.

Threats in Economic Environment of Sri Lankan Film industry

lack of finances for producing films

National Film Corporation did not support the film directors

continually.

To destroyed many theaters during the war.

No restored print film center in Sri Lanka.

Most local films were not recognize the internationally.

Most of film directors are using foreign actors their films.

To paid large advertising expenses.

No film academy establish in Sri Lanka.

Socio-Cultural and Demography Environment

The Cultural environment is made up of institutions and other forces that affect a society’s

basic values, perceptions, preferences, and behaviors.

Socio-Cultural environment based on 3 components. Those are :

Social Environment

Cultural Environment

Demographic Environment

The culture of Sri Lanka dates back over 2500 years. It is influenced primarily by

Buddhism and Hinduism. According to Islamic folklore, Adam and Eve were offered

refuge on the island as solace for their expulsion from the Garden of Eden. The island is

the home to two main traditional cultures: the Sinhalese (centered in the ancient cities of

Kandy and Anuradhapura) and the Tamil (cantered in the city of Jaffna).

Latest Changes in Socio Cultural and Demography Environment of Sri Lankan Film Industry

Increasing film halls in Sri Lanka. Increasing demand for elders only films and family films Most of the films target Sri Lankan younger generation. To issuing different price of tickets on people’s income. To developing most of the facilities in film hall To making various type of films. Cultural change in third generation. Review of the darkest periods in the contemporary history of Sri Lanka . ethnic war, which has been around for decades. Increasing ageing population Lifestyles are modern and fast paced. Increase number of higher education institutes. Increased Tamil population Tourism has taken a sharp rise in the country. Women are employed more than ever. The young generation gives priority to work, and marriage is postponed. Many Sri Lankans are migrating back to Sri Lanka.

Demographic Environment

The demographic factors of the market in which an

organization operates , and which are used to segment

the target population for effective marketing.

Demographic bases of market segmentation Age structure Gender Income Family size & Family life cycle Occupation Education Social class Region and Race Nationality

Threats in socio Cultural Environment of Sri Lankan Film industry

Modernization were presented in culture specific terms, often very crudely. Ideas of socialism, youth unrest, problems of unemployment, alienation of

youth, which were all inevitable concomitants of the modernization process, found cultural expression.

The ferocity of the ethnic conflict and its impact on, and implications for, the state, civil society, rule of law and soon began to be explored in terms of the vocabulary of local culture.

Most Sri Lankan people move to the watch foreign films Not increasing the Tamil Film Industry in Sri Lanka The high increase of mega Tele-dramas.

Technological Environment

External factors in technology that impact business operations.

Changes in technology affect how a company will do business.

A business may have to dramatically change their operating

strategy as a result of changes in the technological environment.

New technology creates new markets and opportunities.

However, every new technology replaces an older technology.

As an example, CDs hurt phonograph records, and digital

photography hurt the film business.

LATEST CHANGES IN TECHNOLOGICAL ENVIRONMENT OF SRI LANKAN FILM INDUSTRY•Digital Cinema -The age of 'filmless film' has arrived.•Sri Lankan movie industry take the cue from India•Using 3D Technology•Trends in technology of format and Film Stock, Cameras and Lenses, Lighting, Sound, Editing and Visual Effects, Cameras, Audio •To using most effective Lighting, Sound, Editing

and Visual effects.

Eg: Abba film

THREATS IN TECHNOLOGICAL ENVIRONMENT OF SRI LANKAN FILM INDUSTRY

•Most of Sri Lankan Films were not exposed internationally.•Coming up bad copies to the market.•digital cinema at home at near-identical resolution•There are movies on demand over cable TV, compressed digital films, and DVDs in the mail.•The lack of facilities and technology•There are movies on demand over cable TV,

compressed digital films,

and DVDs in the mail.

Ecological Environment

The natural Environment involves climate, weather and the natural

resources that affected by marketing activities and economic

activities. Sri Lanka offers wide variety of locations, the cultural

heritage the diverse people and the scenic beauty, draws Film makers

to shoot in Sri Lanka and above all the Sri Lankan Hospitality.

Naturalists say Sri Lanka is one of the easiest places in the world to

spot whales because whales come very close to the shore.

LATEST CHANGES IN ECOLOGICAL ENVIRONMENT OF SRI LANKAN FILM

INDUSTRY

Movie makers eye Sri Lankan locations Highlights

•To using wild screen for their films

•Foreign films used many Sri Lankan film

•location

Eg: Water Film, Mother Theresa

Sri Lanka has many natural locations:

Natural beaches

Water falls

Mountains & plains

Rural village

Rivers

Wild life

Sky scrapers

Sri Lankan film producers used natural locations Eg: Sooriya Arana Film

International production companies like to using Sri

Lankan location such as natural beaches rural

villages rivers and wild life.

As a result Sri Lankan can earn more profits

and income for these films

Threats in Ecological Environment of Sri Lankan Film industry

Movie makers do not care about natural environment

Every production impacts of the environment.

As an example: When foreign (Bollywood and Hollywood) Movie producers use high technology to their productions, so it’s harm to our natural environment.

In recent years in Sri Lanka there have been many significant legal changes that have affected the industry’s behavior. The introduction of age discrimination and disability discrimination legislation and an increase in the minimum wage are examples of relatively recent laws that affect an industry's actions.

Screening of movies has to obtain prior permission from the board of control for screening in movies of Sri Lanka.

LEGAL ENVIRONMENT IN THE FILM INDUSTRY OF SRI LANKA

LATEST CHANGES AND OPPORTUNITIES IN THE LEGAL

ENVIRONMENT OF FILM INDUSTRY

Latest Changes•Minister given powers to intervene and stop screening.

Opportunities•High standard good quality productions done ethically.•A solid legal environment ensures that the industry is stable.•Consequently, a sound legal system reflects professionalism in the industry.•To silence certain unbiased accusations.

•Some films are not allowed to shown in the Sri Lanka because they do not pass through the censorship test.•These incidences harm the credibility and stability of the industry. Privacy policyTaking legal action because of copy right issuesActors not paid and filing cases against producers and directors.Terms and conditions not stated properly.

THREATS IN THE LEGAL ENVIRONMENT OF SRI LANKAN FILM INDUSTRY

MARKETING MIX OF SRI LANKAN FILM INDUSTRY

Product

The ‘product’ here is the films. The Film Cooperation with the government should take care to see that directors, producers are given necessary funding and encouragement to produce/direct quality films.

Price

Marketers should price the tickets

according to demographic

areas the film halls are situated in and according to

the facilities of the cinema hall.

PlaceThe cinema halls (place) are extremely

important to the industry because this is where

the films (product) are delivered to the

audience.

Promotion

Promotion or the ways of communication to the target market is crucial if the producers want to get back a profit.

CONCLUSIONA Pestle Analysis is undertaken to understand the dynamics of the External Environment, which the Film Industry operates in. While these factors are out of the industry’s control, the industry needs to be aware of them to adapt it self to avoid the Threats and exploit the Opportunities in the environment.

The Environment

The external environment Impact on the industry

Political Environment

The political environment is considerably stabilized .

A stabilized political system is good news for all.

Government imposes tough rules and regulations and charge 48% off the films income.

As a result, the cost cannot be covered.

The opening up of North and East areas.

In the film industry there are ore confident of planning long term strategies. The opening of North & East has given the film industry the attractive opportunity of conquering that virgin market and of stabilizing their industry position through out the island.

It’s the Government’s responsibility to maintain a good global reputation for foreign productions.

Foreign exchange coming in to the country.

Economical Environment

A lot of development projects are going on across the country.

The development projects taking place throughout most rural areas have been creating a steady flow of money in the usually laid back markets. There is plenty of opportunity for the film industry to strengthen their profits by concentrating on marketing campaigns in these areas.

Lower interest rates have lured international players to the market

The lucrative economy (bull market) prevailing in Sri Lanka has been luring investors. This poses threats as well as opportunities to the film industry as more financially stronger companies enter and compete for a share of the film industry.

Crisis period has not yet settled down.

Price hikes results in resource constraints for the film industry as the camera is the main tool

Opportunities came with IIFA

IIFA would give many economic benefits directly as well as indirectly

Socio-cultural and Demographic Environment

Women are employed more than ever.

Research shows women act more than men do, thus the trend of working women is positive for the industry.

Increasing ageing population.

-film industry has the opportunity to venture into new Segments and fill up a gap in the market for the elderly population.

Lifestyles are modern and fast paced

Demand for short films is on the rise as a result of modern day lifestyles

Tourism has taken a sharp rise.

The tourist boom can be made handy to market made in Sri Lank a productions to the international arena.

The young generation gives priority to work, and marriage is postponed

- A population with a new taste palette too is on the rise, giving the film industry a reason to widen their production portfolio.

Technological Environment

Investors have been introducing latest technology into Sri Lanka during the last few months.

The continuous introduction of modern technology in the industry facilitates the film’s to keep a breast with the international film’s

Technology is being obsolete at a mind-blowing rate.

Trends and operations.

There seems to be almost

unlimited opportunities

being developed daily.

Consider the expanding

fields of health care, the

space shuttle, robotics, and

biogenetic industries.

The film industry owes it for technology for their undisputed standards of quality and productions.

New technology creates new markets and opportunities.

However, every new technology replaces an older technology. As an example, CDs hurt phonograph records, and digital photography hurt the film

Coming up bad copies to the market

Unfortunately, the SIFF screenings were in BETA format and were very bad copies. They have not a single reprint of a film. In addition, locals are ignored and lose opportunities

Ecological Environment

- Concern for the protection of environment has been on the rise. (Environmental Management Systems (EMS))

Environmental standard certificates are required when exporting films for foreign countries.

Floods have disrupted daily life in few parts of the country.

The demand for films can both increase and decrease during times of crises. Relief support groups tends to produce films for a cause to fund the flood victims. And when victims are unable to go and watch a film clearly, the demand in the area significantly goes down

Low cost budget when shooting a film in local locations

As a result local locations are exposed and Sri Lank a’s natural beauty has got lots of accolades and awards

major opportunity of wild screen come to here.

knowledge and a whole lot of benefits come in to the local scene and to the boom and betterment of the film industry in Sri Lanka

movie makers don’t care about the environment.

This is a high impact industry where there is a perception that filmmakers do not care about the environment

every production impacts on the environment

In the studio and on location, work consumes large amounts of energy and natural resources. They generate waste and sound pollution.

Legal Environment

- Environmental regulations for filming.

Legal factors have an effect on both production and employment operations. Systems have to be either altered or even created to meet the regulatory demands and the film industry would have to bear a considerable cost if changing the usual way of

Disability Discrimination Legislation.

The demand for quality standards gives only a few productions a competitive advantage as they already adhere to most highest standards.

Film Act of Sri Lanka Certain certificates have to be obtained when exporting films.

High standard good quality productions done ethically

International recognition can be gained by through high quality productions done in the highest possible way.

Good productions come out as a result of a strong legal background within the industry

Establishing a solid legal entity to look into

matters in the film industry.

Legal Environment

To prevent petitions Or motions.

Well conceived regulation can encourage completion and ensure fair productions ,thus governments develop public policy to guide commerce sets of laws and regulations that limit business or production to the of society as a whole.

Copyright and Intellectual Property: In order to secure meaningful distribution for a film, a producer must be able to prove that he or she owns, or has a license to use, EVERY piece of intellectual property in the film.

The producer will be very conscious and organized with regard to intellectual property.

Original productions are preserved.

when there is a solid legal foundation and background, more people are willing to help and get involved with the industry.

To prevent from certain people using the law unnecessary to sabotage the movie.

To Silence unbiased accusations.

Written regulations can not possibly cover all potential production or marketing of films, beyond written laws and regulations, films are also governed by social codes and rules of professional ethics.

Considering the above PESTLE analysis, it is safe to say that the current situation of the External Environment is favorable to the film industry.

But, all these positive factors (stabilized political situation, potential of the economy, advances in technology and the expansion of customer base) reflects that competitors too will be lured to do commercial productions.Although the film industry is faced with opportunities to exploit, pressures from competitors will be inevitable.

In Conclusion we have discuss the key Macro Environmental Factors, the Definions,Sri Lankan Context, the Opportunity’s and Threats of the SWOT Analysis which are the External Factors, the Marketing Mix and their implications in the film Industry.

There’s a Compact Disk that we have attached with the report for further reference which depicts the 64 year old Sri Lankan Film Industry’s History , the Macro Environment and an Exclusive video interview with the Leading film director Mr. Udayakantha Warnasuriya.

There would be an In-Depth Analysis on the film industry in our Report.

THANK YOU

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