Shopping trip

The vibrant Australia and New Zealand distribution sector can be lucrative for independent films from the US and elsewhere. Operating as one market for independent distributors - and sellers - the Australian box office exceeded $1bn for each of the last three years, with New Zealand’s box office worth more than $130m last year.

The market’s buoyancy has pushed up competition for titles with crossover potential, and has sparked interest from foreign investors. Two significant Australian distribution companies are now in international hands: last year Canada’s Entertainment One bought Hopscotch and this year French company StudioCanal bought Hoyts Distribution. Both buyers are putting together global distribution networks and were attracted by the market’s strength, stability and robust currency.

“Australia/New Zealand is a very dynamic market with an incredibly strong talent pool,” says Patrice Theroux, eOne’s president of filmed entertainment. “The acquisition of Hopscotch not only provides us with a team well-recognised around the world and at home for their outstanding film choices and innovative marketing campaigns, but also greater access to the talented Australian creative community.”

Theroux notes there is “still a very strong following for independent films in Australia”, and contextualises the purchase in terms of the television and multi-platform opportunities the take-over delivers for eOne’s international content and for Australian and New Zealand content being distributed by eOne. “We expect Hopscotch/eOne to release more films - we added Summit and Lakeshore to our existing relationships in Australia and have augmented the acquisition budget,” Theroux explains.

Hoyts will also be releasing more films. Fresh from visiting StudioCanal offices in Paris and London, long-standing Hoyts chief executive Robert Slaviero says the number of films released will rise to about 15 in 2013 and as many as 20 in 2014.

“StudioCanal is already in Germany, France and the UK, a market with a lot of synergies with us, and it was logical for them to look at the Asia Pacific,” says Slaviero on StudioCanal’s move. “Australia is a dynamic territory in the top 10 worldwide. Why wouldn’t you buy in?”

‘Australia/New Zealand is a very dynamic market with an incredibly strong talent pool’

Patrice Theroux, eOne

StudioCanal’s pipeline of quality English-language production is also well suited to the Australian and New Zealand market.

However, more releases may curtail space even further in an already tight marketplace. “There are a lot of success stories but a lot of films come and go too,” says Richard Sheffield, head of relative newcomer Pinnacle Films, whose upcoming titles include The Babymakers and The Collection. “It is very expensive to release films here and you have to get the prerequisite number of screens. It is such a competitive marketplace that it is very easy for exhibitors just to look at a film and say, ‘No thanks.’”

The word that distributors most often use to describe market tastes across Australia and New Zealand is “sophisticated”. US blockbusters and sequels dominate but there is affection for all sorts of films, including comedies - Ted did spectacular business in Australia - and top-quality arthouse.

“If you are interested in selling in arthouse or crossover, they have to be very high-calibre films,” says Kelly Rogers, CEO of New Zealand-based distributor Rialto Distribution. “You can no longer make any money out of smaller films. Cinemas just don’t want them; they want top-quality breakout films.”

UK films can do very well in the market, especially in New Zealand. The Best Exotic Marigold Hotel [pictured], for example, was a huge draw - it grossed $22m (a$21m) in Australia and $4.4m (nz$5.4m) in New Zealand - boosted by a large and underserved older audience.

Australia’s population is about 7% of the US but the rule of thumb is that films should gross about 10% of the US figure, and in New Zealand a film should manage 15%-20% of its Australian gross.

“We are having a very strong year theatrically and it’s line ball with this time last year,” says Joel Pearlman, managing director of the biggest locally owned distributor, Roadshow Films. “We were ahead but had soft product coming through. It will pick up in the next few months with films like Argo and The Hobbit, and the new Bond and Twilight films.”

AUSTRALIA 2011

Theatres 475
Screens 1,991
Seats 457,000
Total films screened 342
Top ticket price $29.20 (a$28.50)
Average ticket price $13.19 (a$12.87)
Admissions 85 million
Total box office $1.12bn (a$1.09bn)