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Movie Industry Prepares For Funding Drought
It appears the impending recession is already starting to dry up funding for film projects. We hear wind of this dilemma thanks to an article over at the fabled caves of Yahoo. Below is an except from the piece.
As the U.S. economy faces a swirl of negative forces, the film-financing world is set to endure its own perfect storm. And like the economy, things could get a lot worse before they get better. Most evidently, skittish equity investors who once thought nothing of dropping a few million into a project are becoming a lot tighter with their money, while the overall number of equity investors is starting to drop. Almost as dramatic is the change in debt financing, the means by which much of a film’s budget is covered. Money is either too expensive — interest rates have soared from the neighborhood of 10% to 20% for many films — or impossible to get in the first place.
But with the debt market prohibitive, equity investors tight-fisted and foreign sales languishing, film-finance pipelines are starting to close up.
Still, some who note the crowded release schedule of the past few years say a film-financing shakeout may be a welcome development. “I think as we go into a tougher economy, some films won’t get made and probably shouldn’t get made,” Elwes said. As a recession comes, consumers will have less money to spend at the movies — and soon, perhaps, fewer movies to spend money on.
It’s a shame that some projects are going to have a tough time getting off the ground because of a finance drought. I can only imagine how frustrating it would be to have all systems go and then you just sit on the lot because you can’t afford the gas that makes the machine run. With luck, some insanely wealthy film enthusiast will step up to the plate and start writing checks out of love for the medium. Billy Gates – I’m looking at you.
A lack of funds may not be the worst of dilemmas however. I agree with Mr. Elwes that some films shouldn’t be made and perhaps a dry up of funding will thin out the amount of crap that has been flung at us over the past few years. The number of films released in a year has also been climbing higher and higher; I would welcome less releases on a weekly basis as this gives us the opportunity to focus on all the films that are released.
Sadly, some of the worst films make the most money and we may see the axe fall on a ton of cool lower budget motion pictures and indy films that tell stories from off the beaten path. My desire to see all the “run of the mill” dreck get axed may be a pipe dream, and in the long run it may be the visionaries with different perspectives that get hit the hardest.
International friends, what are your thoughts? Do you think the funding issues facing the movie industry will be a hidden blessing or a curse?
I hope this is the rebirth of puppetry over CG in film.
Jim Henson’s Transformers II anyone?
I am all for puppets!
Farscape proved that Puppets still have a place in Sci-fi.
I loved those damn puppets.
i’m fine with it as long as the victims of this are Jason Friedberg and Aaron Seltzer. guys, stop making movies! It’s funny because i’ve not got a problem with uwe boll. I guess it’s cos he at least tries on some level.
Boll also KNOWS he’s bad and he’s just doing all this for fun and to purposely get a rise out of people. Jason Friedberg and Aaron Seltzer actually think they’re good and that their movies are funny.
“I can only imagine how frustrating it would be to have all systems go and then you just sit on the lot because you can’t afford the gas that makes the machine run.”
– That’s me right now. My first film is ready, has a director, and second half money in place. But because of the current situation we’re on hold. As are several other projects related to mine. The wait is killing me….
With this, we know the following will still get made:
1) The new Muppets movie.
2) Saw 16 or whatever number they are on now;
3) John Sayles has a comeback
4) Steven Soderbergh still rules
*****
But on the brighter, sunny side:
1) Fuck you Chris Tucker and your $25 million. New Line is gone and there’s no one left to kiss your ass.
2) No more Evan Almightys and the budgets thereof.
3) More high budget franchise films will shoot back to back or have fewer than two villians.
4) More focus on lower budgeted/ “middle of the road” pictures.
5) More room for filmmakers to think more creatively with less budget/no overproduced budgets.
Yes, I’m an optimist, but I pause and think about the best films -and most satisfying of the last year. The majority of them were produced by under 100 million. Some even less than 75…and how much was Juno made for?
We will always have some sort of outlet. I actually might think this will be an improvement in many areas. There is room for comprimise. There is room for out of the box thinking.
I don’t think big budget 100 mil + films will really dissolve- but maybe it is time to take a small step back from them or scale them down to ‘do we really need this effect’ ‘do we really want such and such’ ‘did we make the point without overstaying the welcome’ and so on.
It is sad that some films won’t get made…but it is a pleasure that others will.