Financing Films

Film Financing

• The producer (e.g. the studio or Production Company) must secure funding before the production of the film, before filming starts.

The problems with this is that it is hard to predict how much (if any) money a film will make.

Thee are various legal and procedural problems in securing rights to a film property.

Government Grants

• Grants are provided by Government Schemes designed to encourage creativity and new talent.

• A film production can benefit a country in a number of ways:– Employment opportunities– Development of Culture– Advertising a location to an international

audience.

Government Grants

• The UK Film Council offers subsidises to filmmakers in the UK meeting certain criteria.

• The National Lottery also offer subsidises and grants to UK-based filmmakers.

• The Escapist (2007) Parallel Films was funded by the UK Film Council, National Lottery and Irish Film Council.

Tax Schemes

• As mentioned before, there are benefits to a country in having a major film release shot on their shores.

• The UK introduced the Producer’s Tax Credit in 2007 to help entice film producers to the UK.

• The Producer’s Tax Credit offers a direct cash subsidy to producers choosing to shoot in the UK.

• This has helped to bring large scale productions like to the UK.

Tax Shelters

• Tax shelters in the UK allow those who invest in UK Films to pay less tax, provided the film is shot in Britain and employs a far proportion of British Actors and crew.

• As a result of this, many American Films choose to shoot at British Studios such as Pinewood and Shepperton.

• This also helped to attract large scale US productions to the UK.

• The UK Tax Shelter for Film Investment was discontinued in 2007.

Pre-Sales

• Pre-Sales involves the producers selling the right to distribute the film before it is made – this is the most common method of Film Financing.

• In order to secure their investment, distributors (usually Major American studios like Universal) will expect certain elements that are likely to guarentee success.

Pre-Sales

• These may include ‘Marquee’ names (Star System) or some kind of change to a film to make it more commercially tenable.

• If a ‘Star’ leaves the film for any reason, this would often result in the funding for a film being pulled, as with Terry Gilliam’s ‘The Man Who Killed Don Quixote’ (2002)

Pre-Sales

• Pre-sales are usually done by territory; e.g. Europe, Australia…

• Pre-Sales can also be made of DVD or TV Distribution Rights

• This is especially likely to be the case if the movie studio distributing the film is part of the same conglomerate as a TV Station.

Working Title Films

• Tim Bevan and Eric Fellner (Working Title CO-Chairman) have said for a long part of their history ‘90% of the time [was] spent trying to secure financing.’

• Working Title Films funds their films primarily through Pre-Sales, which is made much easier as they are part of the same conglomerate as their distributor, Universal Pictures.

Working Title Films

• Working Title Films are also able to secure Pre-Sales because their films contain many ‘commercially sound’ elements:– Popular main stream genres (Rom-Com)– Big name stars (Hugh Grant, Julia Roberts)– Brand name recognistion– They are also increasingly known as ‘Prestige’

filmmakers, with films such as Atonement (2007)

Warp Films

• A small, independent company such as Warp Films cannot offer secure returns on any large investments, as they do not make films featuring ‘Marquee’ names

• As a result, they are likely to secure funding from sources like the National Lottery or the UL Film Council.

Warp Films

• This lack of funding may mean that such companies can only make films in ‘low-budget genres’ such as ‘social realism’, as they cannot afford the effects and casts of genres such as Sci-Fi

• However, this is not necessarily a limitation – low budget films of this kind are often seen as more artistically pure’ and are perhaps more likely to receive Critical Acclaim.

The British Film Institute (BFI) divides films into the following categories.

• Category A: films made with British money, personnel and resources.

• Category B: films co-funded with money from Britain and from foreign investment, but the majority of finance, cultural content and personnel are British. Category C: Film with mostly foreign (but not USA) investment and a small British input, either financially or creatively.

• Category D: films made in the UK with (usually) British Cultural content, but financed fully or partly by American companies.

• Category E: American films with some British involvement.

I.S Hand in next Monday

• Develop a case study into – The Boat that Rocked– This is England

• Release date/Primary audience?• How were these films financed?• What was the BFI film classification and why?• Who distributed them?• Success?

Be as detailed as you can