LONDON — The board of Channel 4 will meet July 8 to decide whether to shut down FilmFour Ltd, the web’s loss-making movie company.
Reports suggest that C4’s new chief exec Mark Thompson has lost patience with FilmFour as a stand-alone venture, and wants to absorb its activities back into the web’s own drama department.
This would involve slashing investment in film production, closing the U.K. theatrical distribution operation, and possibly even pulling out of international sales.
Some FilmFour execs are already actively seeking new jobs. Although some sources believe Thompson has not finally made up his mind, others claim a shut-down is now a fait accompli.
Such a drastic outcome would be a huge setback for the British film community. Even though C4’s film arm has under-performed financially since it was spun off into a stand-alone company four years ago under chief exec Paul Webster, it remains one of the industry’s cornerstones, investing $60 million a year in production and distribution.
“I am extremely concerned,” commented John Woodward, chief exec of the U.K.’s Film Council. “Channel 4 is a very important part of the ecology of the British film industry, both in terms of creative risk-taking and financial muscle. It’s disappearance would be a real blow to building a sustainable film industry.”
The Film Council board debated the FilmFour issue July 2, and mandated Woodward for a last-ditch lobbying effort. “We’re currently in discussion with Channel 4 about their plans ahead of next week’s crunch meeting,” Woodward confirmed. “Obviously we want to continue co-financing film with Channel 4, but the Film Council cannot start bailing out British film companies with financial problems.”
FilmFour lost $8.2 million on sales of $65.5 million in 2001, after losing $4.6 million the previous year. However, its losses are just a small part of the overall $65 million deficit suffered by C4’s commercial arm 4 Ventures.
The film arm has not produced a theatrical hit since “East Is East” in 1999, prompting many in the film industry to question its creative choices and strategy.
Yet some of its highest profile “flops,” including “Charlotte Gray” and “Lucky Break,” actually made a profit for the company, through astute deal-making with international co-financiers such as Warner Bros, Universal, Miramax, Paramount and Germany’s Senator.
In recent months, Channel 4 has been exploring a wide range of corporate solutions to FilmFour’s future, including a theatrical output deal with Momentum Pictures, or a three-way merger either with DNA Films and Signpost Films, or with DNA and Civilian Content.
None of these discussions, however, progressed to the stage of serious negotiations.
If Channel 4 decides to bring film production back into its drama department – which is where the “Film on Four” strand started life nearly two decades ago – it is unclear what would happen to FilmFour’s significant investment in developing new talent through short film schemes and the experimental FilmFour Lab.