If studios are proving resilient to the crisis, the indie sector is feeling the pressure.
Rupert Murdoch, News Corporation’s chairman, is becoming the cheerleader for the media industry’s economic recovery, telling analysts recently that the worst of the global recession was over.
Overall trends suggest that not all cinema is anti-cyclical, and the independent film sector is dealing with a very different economic reality to that of the US studios
Along with believing that his UK newspapers can start charging for online content that people can currently see elsewhere for free (so we’ll see how that plan works out), he is also optimistic about the way the film industry is holding up in the recession.
“The movie industry is proving itself anti-cyclical,² he told the same analysts, pointing to the success of Fox’s X-Men Origins: Wolverine and the importance of the franchise blockbuster for studios including his own.
Murdoch has an enviable knack of calling it right when everyone else is wrong, but his analysis of the film industry, like his belief that newspapers can erect pay barriers in front of largely commoditised content, requires further scrutiny.
On one level -speaking as a US studio owner -he is right that the majors and their output are generally proving resistant to the recession and delivering the crowd-pleasing fare that keeps mass audiences coming back when times are tough. That is clear in some of the analysis in this issue of Screen as we report on the box office so far this year for limited-release films.
In the US, for example, the Hollywood studios saw growth of 17% on gross ticket sales of $2.8bn in the second quarter of this year. The major studios and their affiliate distribution arms between them carved up 95% of US box-office revenues, a level of domination these companies have not seen for the best part of 20 years.
Overseas, US studio movies continue to dominate, taking 66% of international box office across the globe in the second quarter of this year, compared with 50% in the same period last year. But the global success of the popcorn franchise such as Harry Potter, Wolverine or Transformers is not such good news for independent producers and distributors, where the story is somewhat different to Rupert Murdoch’s world.
In many markets, indies are being squeezed by a credit crunch which has dried up bank lending, cutbacks in soft money funding as governments close the public purse, and the challenge of attracting audiences to films without multi-million-dollar p&a funds. Across many key markets, the box-office figures for indies make tough reading.
The phenomenal success of Slumdog Millionaire in many respects distorts quite how difficult trading is for the indie sector. In the UK for example, with Slumdog included, films produced outside the US accounted for $173.6m at the box office in the first six months of this year -up by 6.2% on the same period last year.
But take Slumdog out of the equation and the trend looks very different, with the indie sector’s total box office down 25.4% on the same period the previous year. Fewer indie films are making an impact at the UK box office -and those that do are actually taking less money. Slumdog is the exception to the rule that things are tougher for indie films in many key markets.
Some markets are also seeing drops in attendance. France is slightly down against last year and admissions in Italy dropped 2% in the first six months of this year. The chill of the recession is being felt with more bite by those attempting to make and distribute independent films.
So overall trends suggest that not all cinema is as anti-cyclical as Murdoch would have us believe, and that in the current downturn the independent film sector is dealing with a very different economic reality to that of the US studios.