When it comes to meaningful financial information and market intelligence, the highly competitive game of film is well and truly stacked: ‘Studios base their greenlight decisions on finely-honed models derived from the financial performance of numerous other pictures [but] when it comes to quality data about independent film, we are together in the dark’ - The Transparency Project.

 

What’s the problem?

 

The problem is that information is power. Those who have it are at a massive strategic advantage, and those who don’t, flounder, and all too often, fail.

Problems with accessing meaningful data:

 

• In the independent sector in Australia ‘Commercial-in-confidence’ or secrecy laws surrounding the Producer Offset protect much of the data that would be useful to producers.

• There is pretty much only one number used to judge the success or failure of a film – the Box Office.  This an inaccurate measure of independent film, and it has become impossible to extrapolate from Box office to total earnings in this day of digital distribution.

• Digital revenues are largely hidden from filmmakers.

• Filmmakers working alone or in small teams are not able to accumulate significant market intelligence.

 

Does it matter?

 

This situation matters a great deal.

 

• Most filmmakers base their investor pitches, and their development and distribution decisions on anecdotes and hearsay.

• Lack of access to information means filmmakers cannot learn from each other’s successes, and mistakes.

• Lack of information inhibits filmmakers from thinking innovatively about their releases – they cannot design the most effective releases without being able to see what has worked, and what has not worked, for other releases.

• Without information companies cannot construct proper business plans that predict future earnings and suggest new development strategies.

• Without access to real financial information on both cost and recoupment, we are unable to provide investors with the information they need to make informed investment decisions – this inhibits the raising of money for individual films as well as inhibiting an informed equity class from entering the sector.

 

The film industry is faced with disrupted business models, an ever-changing distribution landscape, ever-splintering markets and rampant piracy. In this whirlpool, small producers scramble in the dark, wasting time, effort and money.

 

A solution

 

For commercially minded independent producers to thrive – or even survive, they need something that the current industry structures do not provide them.

 

They need -

 

• Financial data about potential revenues for a film, and the costs it takes to recoup those revenues.

• Market intelligence on deal structures, market values, industry players, and market demand and industry trends– what films are working, in what markets, and at what level.

• Reputational knowledge on industry players – distributors, suppliers, potential partners.

 

What is required is a platform for capturing, processing and sharing information.

The solution is simple in concept: Individual producers form a collective to share information.  

We now have a unique and timely opportunity to become part of a global transparency movement, and benefit from work already done by others.

 

Download full Paper: Power In Numbers – How filmmakers can benefit from sharing information.