Film industry fights off budget cuts, finds new methods

To say that the Mexican film industry started out the new year somewhat like a recovering swine flu victim would be telling only part of the story.

In September, President Felipe Calderon sent a budget to Congress that included austerity cuts of 40% to Mexico’s National Film Institute (Imcine) and its funding programs. It also lowered by 20% the ceiling on total contributions to Mexico’s innovative 226 tax incentive program, pushing it down to 400 million pesos ($31.3 million).

The industry fought back. Organized media campaigns and lobbying efforts paid off with a full reinstatement of budgets and laws to strengthen 226 against an extra tax that could have hobbled it.

But after a brief sigh of relief, the Mexican film industry now faces a global market beset by recession and perplexing technological challenges.

There’s now pressure to make higher-quality films, often through international co-productions, and to access innovative distribution channels as a means of realizing the full artistic and budgetary potential of Mexican filmmaking.

Finance programs like 226 may have helped more films get produced, but quantity does not necessarily mean quality.

Some producers like Fernando Rovzar, of the shingle Lemon, and Tania Zarak, who recently ankled Argos Films to start Bonita Films, see new quality controls as a possible solution.

Zarak envisions a “filmmaking is for filmmakers” model, controlled through “autonomous, well-informed, independent councils.” Rovzar would like to see “industry-driven” controls that don’t judge the story.

Working out of New York and Mexico City, Bonita is already moving into new territory. Frosh project “The Girl” is the first U.S.-Mexico co-production to access the 226 tax incentive.

For Zarak, “Opening the arms of 226 to the world is a great means to attract international co-productions and foreign investments.”

With branches in Mexico City and the U.S., Lemon and Bonita straddle not only the border but the spectrum of strategies being employed by Mexican filmmakers from Cha Cha Cha’s three big directors, now firmly ensconced in Hollywood, to the more auteur-driven packages put together by stylish indie shingles like Mantarraya Prods. and Canana Films.

One Mexico City producer, Alebrije Films’ Monica Lozano, is taking a more project-as-a-whole approach instead of building a super-talented auteur stable. “It’s the creative package — the story, the script, the director and the technical as well as artistic elements (that) I’m looking for,” she says.

Lozano is producing “El atentado,” one of a raft of films heavily supported by state coin to celebrate this year’s bicentennial of Mexico’s independence and centennial of its revolution. She says state coin allowed her “to tackle these stories and these themes and count on resources that make ‘Atentado’ internationally competitive.” At $6.1 million, the project is one of Mexico’s priciest.

Most of the new Mexican film industry is driven by a young generation of artsy cineastes. All 10 helmers on omnibus Berlinale Special “Revolucion” broke through, at least as directors, in the last 10 years. They’re far more global-minded than past generations. Some, like Patricia Riggen, have crossed over to Hollywood.

For those who stay, one key to survival will be finding creative solutions to a harsh domestic distribution environment. At home, exhibs take in 65% of the gate, as opposed to the usual of about 50% in most of Europe and the U.S., and they routinely boot small, Mexican films from theaters after the first week.

Rising to this challenge, Canana and Mantarraya have become mini-distribs in their own right. Canana now has its new genre distrib label, Tangente, and is working on boosting its VOD system, Canana en Demand, carried exclusively in Mexico on Cablevision.

For the Diego Luna-directed “Chavez,” Canana released the DVD and VOD day and date, and it “was a huge success,” says Canana founder Pablo Cruz. “People saw it on VOD and then went out to buy the original.” With Cablevision’s infrastructure in Mexico and Central America, there are strong growth possibilities.

“We’re really pushing VOD. It’s the future in terms of how people will consume the films we make and buy,” Cruz says, adding that for “Revolucion” he is aiming for day-and-date theatrical, broadcast and VOD release.

With inhouse directors like Carlos Reygadas and Amat Escalante, Mantarraya has long worked with Jean Labadie and Le Pacte to move its niche fare into Europe. Mexico’s top indie distrib, Gussi, now handles Mantarraya’s larger projects.

For Mantarraya prexy Jaime Romandia, building relationships by collaborating with a steady team leads to a familiarity that makes projects work better every time — something he applies to sales agents as much as directors.

“With Amat (Escalante) and Carlos (Reygadas), we have a road we’ve already walked down,” he said. “We’re working together on Reygadas’ next project. We already know what to expect — me from him and him from me.”

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