M+E Connections

Okay, 2020’s been tough! Sure, we watched Outbreak and Contagion last year but no one really took this whole pandemic thing serious until mid-to-late March when Tom Hanks announced he and his wife, Rita Wilson, tested positive for COVID-19 while he was in Australia filming an Elvis Presley biopic.

Suddenly people were saying, “Holy s*** this stuff is real … and serious!” At about the same time, folks around the globe were sent home to work, wherever and however. With the exception of reality and late-night TV, entertainment production was in a deep freeze … paralyzed.

Box office revenues sunk to zero, the film supply got shifted, theaters closed. According to Statista an estimated one million M&E workers were suddenly out of work. The coronavirus pandemic crippled production around the world and it started to feel like it was maybe going to be forever. Business slowed to interacting on a Zoom screen wreaking havoc on film and TV production schedules.

It moved the industry to reconsider the stories that were being told, how/where they were being made and how they were being delivered.

In addition to being eager to get project production back on track, the forced hiatus gave the industry an opportunity to step back and review its methods/processes and the cost of production which has ballooned in recent years.

While film production was cautiously beginning to see a thaw abroad, the US continued to be in a deep fog.

The lack of a U.S.-wide policy/program on how to address the virus, contain it, provide adequate testing, integrate national safety/health guidelines or implementation mandates due to there being only a glimmer of a vaccine put the industry between a rock and a hard place.

If they weren’t there already, producers began to look at international options as country leaders made hard calls to control the pandemic in their country and put their economies back on track … slowly, safely.

Okay let’s be fair about this, international production was rising in popularity even before the pandemic because of the construction of new, more advanced studio facilities, investment in enhanced technology, ready availability of skilled creative production personnel.

Attractive tax rebates and intelligent project underwriting insurance support only sweetened the offer.

Bringing to light what seemed to be an apparent lack of interest by the government supporting the US creative content industry which has long been a major hurdle for studios, content owners.

This despite the fact that M&E production in the U.S. employs more than 350,000 people and most recently produced an estimated $139 billion in sales.

Insurance has always been a critical issue and it was compounded for those who wanted to return to production following the recent pandemic lockdown.

“Many countries, especially those that opened early for movie and TV production adopted a variety of stage/crew production guidelines as well as revised financial incentives that were supportive and beneficial,” Allan McLennan, PADEM Media Group chief executive, noted.

“That meant it was a straight forward decision for studios/producers to adjust, modify and relocate their project productions, especially if it enabled them to keep on as best they could on schedule and keep their financing on track,” he added.

While theaters were opened, closed several times during the first, second, third waves of the pandemic people were still hesitant to experience films the way producers wanted their projects to be seen and many box office trackers estimate that it will take until 2022 before ticket sales “recover.”

“It is a catch-22 situation,” McLennan said. “Through the end of the 2020 theaters have done a herculean job — increasing sanitation practices, new air filtration, distancing, requiring masks, everything but great content.”

“With ticket sales now running at 10-20 percent of theater capacity (on a good day), studios are questioning what their best path is to present their new films, considering other options and release windows to capture ticket sales,” he continued. “And according to Morning Consult, a global data intelligence company, only about 22 percent of consumers will be comfortable returning to theaters any time soon which only further complicates the situation at this stage.”

“Studios, content owners are evaluating how long they should wait for the consumers to return or at this time continue to offer their new content via streaming services where people are being entertained today and prepare a new support model for theatrical releases,” he added.

Even before the pandemic, OTT had become an inviting way for studios, content owners, networks to improve their connections with consumers with less reliance on Pay TV and…movie houses.

Netflix with more than 200 million global subscribers in 190-plus countries and Amazon Prime with 150 million members worldwide and most recently Disney+ with nearly 90 million subscribers in more than 30 countries have proven people are willing to subscribe to content services to enjoy a wide selection of quality content when they want and on the screen they want.

The three houses were already producing content in countries around the globe as a result of country service agreements which mandated that they had to produce 30-plus percent of their content locally.

Turns out that was a good thing because locals not only liked the films/shows but folks elsewhere also found them entertaining whether they were dubbed or subtitled.

Good content travels well!

Film/show producers, crews can adapt to any location and the US teams eagerly proved it in 2020 taking all of the restrictions and requirements in stride.

Canadian production had just come off a record-breaking year ($2.16 billion in Ontario, British Columbia had a record year, Quebec racked up more than $2 billion) when the pandemic hit and weathered the several waves of infection better than their southern neighbors.

Setting rigid requirements for projects that fled north of the border the Canadian production industry experienced few outbreaks and quickly isolated them so that by the first of the year they were back working at near-full capacity.

The country’s independent film/TV production sector was well prepared to meet the global demand for the high quality, original content. Projects that already had production insurance in place were able to return to work following the new cautionary measures and protocols.

Projects that quickly turned to Canada for completion assistance especially when Alberta announced a 48-hour quarantine program rather than the normal two-week isolation. The Canadian efforts were instrumental in helping production teams get their insurance rather than have to wait several months for relief, rely on in-house policies or adhere to strict policies, depopulate the set and hope for the best.

B.C. had more than 60 at the first of the year including 22 TV series produced by CBS, Netflix, Disney, Amazon, Warner and ABC.

In addition six feature films, 10 new media projects and 23 TV movies are in the works including “Batwoman,” “DC’s Legends of Tomorrow,” “Charmed,” “Nancy Drew,” “Riverdale,” “The Flash,” “Supergirl,” “Van Helsing,” “A Million Little Things,” and more large and small projects.

One of the industry’s most progressive/aggressive country commissions — New Zealand Film Commission — which understands the positive impact of the industry on the country’s economy
expressed confidence that every country would create effective [health and safety plans] to account for this and future pandemics so they could responsibly resume production in their countries.

Because of the aggressive actions New Zealand’s PM Jacinda Ardirna took at the outset of the pandemic — shutting non-essential businesses down, closing the borders and more; projects only suffered minor production schedule setbacks.

Professionals who had to enter the country had to quarantine for two weeks and test negative before they could work on the projects but the restrictions and governmental cooperation kept major and minor projects including Avatar, Cowboy Bebop, The Greatest Beer Run Ever, and others on budget.

In addition to Tom Hank’s Elvis biopic being shutdown (production resumed in October), more than 120 projects were shut down or canceled costing the Australian production industry an estimated $2 billion.

The country’s production guidelines enabled work to resume in mid-year on projects including Shang-Chi and the Legend of the Ten Rings, “The Bachelor Australia,” Thor: Love and Thunder and others.

To attract and stimulate more film, TV production the government added $291 million incentives to its existing 30 percent budget offset.

Working closely with unions and industry groups, the BFC (British Film Commission) had a 26-page set of proposals for restarting TV, film production last summer.

While the fact that Tom Cruise’s M:I 7, 8 received the most “star attention” when they returned to Leavesden Studios in England, Jurassic World Dominion received the most production attention because it was one of the first projects to be produced under new production health/safety guidelines.

Despite intense efforts to keep the British Pinewood Studios, crew cast coronavirus-free; they still suffered a couple of infection setbacks. The health protocols added about $5 million to the project budget.

All of the studios have locked down major long-term soundstage leases including Disney, Netflix and Warner to ensure production capacity over the next couple of years.

In addition to expanded facilities from every major studio, England has some of the most advanced independent studios in the world which has resulted in an annual income to the government of more than $4.8 billion annually.

To support the industry the country has a $647 million insurance fund for film, TV production providing 50 percent of the project budget is spent in the U.K. As a result, a number of projects have relocated to England including The Serpent, Batman and other major and secondary films and TV series.

Film commissions across Europe including Italy, Germany, Spain, France, Czech Republic, Slovakia, Hungary and Poland all developed — and promoted — safe production guidelines and activities as well as new incentive programs and the quality of their infrastructure and depth of production crew expertise.

This is in addition to maintaining local TV and film production projects with minimum crew, elimination of close contact activities such as kissing and hugging, support through insurance and added location incentives as well as aggressive programs to work to manage and control the virus.

While Iceland experienced only a slight “slow down” of video story production because of rigid testing and quarantine activities, the country maintained a steady project flow thanks to insurance coverage to all local productions.

Outside production in China remained “modest” during the pandemic because of visa suspension and the requirement of a letter of invitation from the government.

Restrictions are only now slowly being eased.

South Korea has been as cautious in controlling the pandemic and providing filming guidelines as New Zealand. As a result, they minimized lockdown issues and project suspension.

India’s foreign project production came to a virtual stop last March.

The combination of issues including the fact that each of the country’s 36 states/territories being independent, with each establishing its own entry and project production requirements, made it extremely difficult for new projects to begin.

As if COVID issues weren’t bad enough Bollywood and Nollywood also suffered from internal strife and uprisings making studios and producers reluctant to take on yet another obstacle.

Most foreign producers believe it will take several years for the issues to be resolved so projects can return.

Rather than previous multi-country work, studios and producers are focusing on more controllable spaces — studios, single locations — to help deliver projects quickly, economically and safely.

“The lessons learned, and project management refinements will become the new norm for at least the next three-to-five years,” McLennan observed. “Countries and studios have found that they can rethink and rework projects with single locations, minimal crews and team/actor rotation to develop, deliver a quality product without some of the earlier lavish budgets.

“It has been an eyeopener for everyone involved in film and TV content production, but like all challenges there are benefits being identified and new processes implemented to meet the demand and keep the productions economically and efficiently rolling,” he added.

But to keep things in perspective, Polly Perkins in Sky Captain and The World of Tomorrow noted, “It’s only a movie, Mr. Paley. I’ll bring you some popcorn.”

Andy Marken, President, Marken Communications, is an author of more than 700 articles on management, marketing, communications, industry trends in media & entertainment, consumer electronics, software and applications.