Turning British film upside down

In recent months, the UK film industry has found it very hard to avoid Chris Smith. The former secretary of state for culture, media and sport, is heading the government’s extensive Film Policy Review. Smith has been a near ubiquitous presence as he leads his eight-strong panel on an exhaustive nationwide consultation in which every shade of industry opinion has been registered (he has received more than 300 responses).

The report is due to be published in early 2012. Its findings will form the basis of what could become a fresh approach to public investment in the UK film industry, mostly via the National Lottery, which is expected to rise after next year’s London Olympics. The British Film Institute is also readying a five-year plan of its own, which is likely to take the Film Policy Review points on board.

The review aims to identify the “market failures” of the UK industry. Over the past 15 years, since Lottery money first began to be invested in British film, hundreds of millions of pounds have been invested in production. Now, a growing section of the industry believes the real problems are?with the delivery side of the industry: ­distribution, export, film training and education.

“Producers always speak more loudly than distribution,” says Eve Gabereau, the co-managing director of indie distributor Soda Pictures, of how she believes debates about public film policy have traditionally been skewed in producers’ favour. “In terms of the amount of money allocated, it is quite clear distribution gets not as much as production. Obviously, the costs are different and distribution is quite a different beast but the louder you shout, the more attention you get.”

For those outside the industry, including in government, distribution is a “nebulous” field that isn’t fully understood or valued, she suggests.

Ironically, Smith’s review has been taking place as the UK industry occupies a strong position. As Xavier Marchand, managing director of Momentum Pictures, puts it, 2011 “has been a massive year” for the UK. Homegrown movies The King’s Speech (distributed by Momentum), Entertainment’s The Inbetweeners Movie and StudioCanal’s Tinker Tailor Soldier Spy have been box-office hits, and in the first nine months of the year, UK admissions were up 4% year-on-year by the end of September.

Film also continues to generate huge amounts of inward investment with the film tax relief now extended until 2015, influenced no doubt by the news the so-called “creative industries” (of which film is prominent) account for 7% of the UK’s GDP. Some of the world’s biggest productions, including the new James Bond film Skyfall, Christopher Nolan’s The Dark Knight Rises and Ridley Scott’s Prometheus are now shooting on UK soundstages and in UK locations.

So where should the bulk of the Lottery cash go? Mark Batey, managing director of the Film Distributors’ Association (FDA), argues if public investment is to be maintained on such a grand scale, the public should benefit. Their interests should be “front and centre” of any new film policy.

His inference is clear: It is all very well investing in the production of new UK films but it is equally important the public should have the chance to see them, whether in cinemas, on broadcast or satellite TV or online.

“You can’t assume that audiences will come,” cautions Batey, of a policy foregrounding production without paying equal attention to stimulating demand. “If it was the motor industry, you wouldn’t get people saying: ‘Why don’t we just build cars. We don’t need to worry about anything else.’ That’s nonsense!”

Senior industry figures, among them Batey and David Puttnam, the president of the FDA and a figure long considered by many as the ideal person to bridge the gap between practitioners and politicians, are throwing their weight behind calls for a new, muscular audience development fund. It would encompass everything from education to festivals, to support for prints and advertising costs.

“The difference between the European and the American film industry is that Europeans have convinced themselves this is basically a production-led industry and that if you make good enough movies, all else will be OK,” Puttnam says. “The other reality, the American reality, is that it is a distribution-led business. If you get distribution right and make the right decisions, then that is the route to long-term happiness.”

Not everyone agrees. “If producers are dominating the debate, it is only right,” says Rebecca O’Brien of Sixteen Films, the outfit behind Ken Loach’s films including Palme d’Or-winner The Wind That Shakes The Barley. “Producers are at the middle of the industry. They are the engine room, the entrepreneurs of the industry.”

Barnaby Thompson, the head of Ealing Studios, agrees, calling the independent producer “the creative entrepreneur at the heart of the movie… you can have the best distribution systems in the world but if you don’t have that creative entrepreneur at the centre of the process, films don’t get made and the right films don’t get made.”

Certainly, the independent distribution sector is extraordinarily lop-sided. With the exception of the Green brothers’ Entertainment, the bigger independent companies are all part of foreign-owned networks and are well-placed to compete with the US studios. However the specialist distributors face daunting market conditions.

Companies such as Verve, Dogwoof and Soda Pictures, which all consistently release UK films, are faced — as are all distributors — with the lowest rentals in Europe (generally weighted 60% in favour of the exhibitor), the crippling cost of the virtual print fee (VPF) and a still chronic shortage of screens for their films.

“There is no way the government can intervene on VPF, on what it is and how much it costs,” says Soda’s Gabereau of the VPF charge levied on distributors to help pay for the conversion to digital, “but there is possibly a way to make it not a barrier or hindrance to developing digital networks [for] distribution. It is fairly expensive and it shouldn’t be.”

Sales agents are in an equally tough situation. “We need to ensure the role of the sales company is recognised as a vital sector of the British film industry,” says Bankside Films’ head of sales Stephen Kelliher, who is the chair of Film Export UK.

His calls for the ­establishment of an export fund have already been heeded, at least in the short term with the launch of a $315,000 (£200,000) Lottery-backed Fund for UK films at international festivals.

Barnaby Thompson disputes the notion that distributors’ interests have been overlooked. He points out that film policy at the former UK Film Council when Alan Parker was chairman was (at least partially) distribution driven.

“Production led by distribution, not the other way round. Pull, not push,” Parker declared in a controversial 2002 speech. What rankled with many was his call for the UK industry to strengthen its “traditional links with the American industry” and to “abandon a Little England” vision of a UK industry — in other words, to throw in its lot with US distributors.

“That policy led to a confused sense and put neither the producer nor the distributor in the driving seat,” Thompson says.

There is a paradox here. Sixteen Films and Ealing have been able to make many films over the last decade and appear to be thriving. However, O’Brien and Thompson both contend the recoupment terms often demanded by public funders during the Film Council era were too harsh. This meant that even when the films were successes, the profits rarely trickled down to the producers. “They were last in the queue… a lot of producers feel they’ve been patronised,” O’Brien says.

As a member of producer association PACT’s Film Policy Working Group, O’Brien is throwing her weight behind PACT proposals for 100% of the public investment in a project to be recouped by the producer. Adopting such a policy, runs the argument, would allow producers to retain rights and build up the value in their companies.  

Sixteen Films’ partial solution to its funding challenges has been to set up its own sales company, Sixteen International Sales, which handles pre-sales on Loach’s films. It means there is guaranteed income for the company from the European partners who are always ready to pre-buy a Loach movie.

Indeed, a move toward greater integration between production, distribution and sales is already underway as the indie distributors have matured at the same time as the indie producers in the past decade. Companies such as Vertigo, Revolver, Lionsgate UK, Artificial Eye and StudioCanal now produce their own films.

It is simplistic and reductive to suggest producers and distributors are in open competition. Their concerns have always often overlapped. Even so, Smith’s Film Policy Review may offer a chance for the UK industry to come up with a film policy that bridges the concerns of both sectors, one that is neither production pull nor distribution push.