Oz Film, No Thanks To Tv, Gets Some Hard Knocks

The Aussie film industry, similar to a wooden roller coaster, is undergoing classic highs and lows; some areas are shaky, some fast-moving, and others almost at a standstill.

One thing is the same, at least in film production: everyone’s uncertain about how the ride finishes and some aren’t quite sure whether they’re going to make it.

That’s in large part due to the state of Australian tv. The cost cuts instituted by thrifty receiver/managers and new owners have had a domino effect. At one end, major drama production levels and license fees payable are way down. At the other,theatrical distributors are paying less for foreign films because the networks are no longer offering the same prices.

The volume of film production is about the same as last year. Australian Film Finance Corp., the industry’s principal funding agent, at presstime had entered into investment negotiations on 15 features since July 1. That’s in addition to its 1991 five-pic film fund as well as ongoing low budget feature production funded by the Aussie Film Commission and various state film agencies.

But with private investment virtually non-existent for production, industry has become starkly reliant on government funding (even on a commercial investment basis) to maintain its current level. Says John Morris, chief exec at the FFC: “The size of the industry is dictated by the size of government allocation.”

Hoist that profile

The FFC has two more years before renewal so, for the mean-time, the industry is being kept at a medium level, although its infrastructure could support much more.

Industry is also yielding an increasing amount of official co-productions (undertaken with a country where Oz has a treaty or agreement in place) such as “Green Card” and forthcoming The “Black Robe.” Although these may not use Oz production resources as much (as they’re often shot completely overseas) they’re proving to be strong profile raisers and potential revenue earners for the industry.

Kindred sectors of exhibition and distribution are faring better although a recession has put even greater pressure on reducing debt and gearing levels for the major players, particularly the debt-straddled Hoyts empire.

B.o. and admissions rose almost 12% last year and first-quarter results indicate another strong year. But that growth carries its cost too. Exhibs need a long-term payback from the massive investment they’re making in multiplexes, and distribs are having to change their ways of doing business to keep their footing in a rapidly expanding market.

So expect some consolidation this year. The major circuits will slow down to developing between them perhaps three sites a year from now on and look for more cost savings to increase multiplex earnings. Distribs will be looking to make their releases more cost effective in the increasingly lucrative Oz market.

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