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Drama report 2019/20 shows impact of pandemic on screen industry

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Screen Australia’s annual Drama Report released today shows expenditure in 2019/20 on drama production in Australia reached $991 million.

This is 18% down on last year’s spend, largely due to the effects of the COVID-19 pandemic and the near total shutdown of large-scale drama production in March 2020.

The Drama Report uses data from industry to provide an overview of the production of local and foreign feature, television and online drama titles, as well as post, digital and visual effects (PDV) activity. All expenditure is allocated to the year in which principal photography began. PDV employs a secondary method of analysis, which is outlined in the PDV section below, and in the report. ‘Drama’ refers to scripted narratives of any genre.

Expenditure by Australian titles that started principal photography in 2019/20 accounted for 55% of the total expenditure, with $543 million generated by 74 Australian productions, down 32% on 2018/19’s record result. In total, 41 foreign projects (including PDV-only titles) generated $447 million in spend, an 8% increase in spend on 2018/19.

This year’s report provides an insight into the impact of the COVID-19 pandemic on the Australian screen industry, which resulted in the near total shutdown of large-scale drama production in March 2020, and continues to present significant challenges for production and the wider sector both in Australia and internationally.

Minister for Communications, Cyber Safety and the Arts the Hon Paul Fletcher MP said,

“We’re committed to supporting the industry as it moves forward with production activity across the country. The Government’s $400 million increase to the Location Incentive Scheme announced in July will attract more foreign film and television productions to Australia over the next seven years, and we have also announced further reforms to the long-term regulation and funding of content. The $50 million Temporary Interruption Fund to date has been allocated to 23 approved projects supporting the safe return of production. And we have provided additional funding of $53 million to Screen Australia and the Australian Children’s Television Foundation for the development and production of quality Australian content.”

Screen Australia’s Chief Executive Officer, Graeme Mason, said,

“Never in the 30 year history of the Drama Report have we seen an event like the COVID-19 pandemic. While we looked on track to celebrate a record year in many areas of the industry, the pandemic is estimated to have postponed around 26 Australian drama titles with total budgets exceeding $325 million. This large scale impact is unprecedented.”

“Despite the hardships, I’m encouraged that our industry has been able to safely and markedly increase production activity and there are already positive signs that our sector will be able to bounce back. As a result of support from the Federal Government’s Temporary Interruption Fund (TIF) and Screen Australia’s direct COVID-19 funding we have supported a safe return to work on projects with combined production budgets of over $330 million. The TIF continues to fill a vital gap in getting productions back up and running, and has now been replicated in many other countries.”

“I commend everyone in the industry on their tenacity, resilience and ability to adapt and find ways to move forward in the midst of a global pandemic,”

– continued Mason.

Screen Australia’s Chief Operating Officer, Michael Brealey, said,

“The Australian screen industry is flexible and robust and this has been evident in the speed with which the industry adapted to adversity at every level and responded to COVID-19’s impact. Several interrupted productions were able to recommence shooting in June, including Network 10’s Neighbours and the second season of Five Bedrooms, and series two of children’s series The Bureau of Magical Things for Netflix and Network 10. ABC comedy Aftertaste was able to commence pre-production in Adelaide in June, and Seven series RFDS returned to pre-production in Broken Hill. Not to mention the ways in which creative teams responded with innovative ideas with projects like CancelledRetrograde and At Home Alone Together all filmed during lockdown making it a part of the story.”

“Australia’s ability to stem the spread of the virus to date has made us even more attractive as a safe and viable location for globally backed productions, which is already creating exciting opportunities and long term potential,”

– said Brealey.

New South Wales accounted for 48% of Australian spend to reach $475 million while Victoria accounted for 28% of spend reaching $297 million, the majority of which was attributable to domestic TV and online drama. South Australia reported 15% of the national share with a total spend of $146 million, a new record and increase of 34%. Queensland accounted for 5% of the national share ($53 million), followed by Western Australia with 3% ($34 million) and the Australian Capital Territory, Tasmania and the Northern Territory accounted for the remaining expenditure of $4 million.

GENERAL TELEVISION DRAMA

In 2019/20, $198 million was spent on 20 general Australian TV drama titles, with expenditure down 39% on last year’s record spend. 351 hours of content was generated and all titles had combined total budgets of $198 million. Series that entered production in 2019/20 included series 2 of ABC’s Mystery Road, Nine’s Halifax: Retribution, ABC’s Wakefield and series 2 of Network 10’s Five Bedrooms.

Across the general TV drama slate, hours, budgets, spend, and average cost per hour were the lowest in more than 10 years. Five general TV dramas that entered production in 2019/20 had their shoot interrupted due to COVID-19. Evidence suggests that seven general TV drama titles, with combined budgets of more than $45 million, were postponed due to COVID-19.

General Television Drama is drama made for family and adult audiences. It does not include children’s drama, which is reported separately below. In previous Drama Reports this section was labelled “Australian TV drama” – the change in name is intended to clarify meaning only, and does not include any further change to methodology.

CHILDREN’S TV DRAMA

Twelve children’s dramas entered production in 2019/20, with a total spend of $46 million and generating 78 hours of content. This spend was 55% down on last year, with budgets also down by 52% and hours of content down by 51% on last year’s six-year high. One children’s TV drama that entered production in 2019/20 had its shoot interrupted due to COVID-19. Evidence suggests that two children’s TV drama titles, with budgets of more than $10 million, were postponed due to COVID-19.

ABC financed seven of the 12 titles in production, including animations Kangaroo Beach and Space Nova (which was also financed by Nine), and live action titles including First Day and the third series of Mustangs FC. NITV was the first-release broadcaster for the live-action series Thalu, which was also financed by the ABC. Five titles entered production that were financed by the commercial broadcasters including The Bureau of Magical Things series 2 (Network 10), The Gamers 2037 (Nine) and Kitty is Not a Cat series 3 and Tales of Aluna (both Seven). One title, Alphabet Street, was financed by Disney Junior.

The proportion of animated titles produced has declined over the last five years, with live-action titles accounting for around half of the yearly slate in the last two years.

ONLINE

The Drama Report classifies online drama as single episode or series titles with total durations of 30 minutes or more that have premiered in Australia online. Online titles can premiere on social platforms such as YouTube and Facebook, subscription video on demand (SVOD) platforms such as Stan and Netflix, transactional video on demand services such as iTunes, and broadcaster platforms such as ABC iview.

In 2019/20, 23 titles, all of which were series, were first released online with a total spend of $94 million. While fewer titles were produced in 2019/20 compared to last year, hours increased by 16%. Considerable increases in budgets and spend can largely be attributed to two larger-budget titles for SVOD platforms. A much greater proportion of budgets was spent in Australia this year, with total spend rising 95% in 2019/20. Two online dramas that entered production in 2019/20 had their shoot halted or interrupted due to COVID-19. Evidence suggests that eight online drama titles, with budgets approaching $20 million, were postponed due to COVID-19.

Returning titles included series 2 of Stan’s Bloom and series 2 of Meta Runner on YouTube. New titles that entered production included Netflix’s Clickbait, Stan’s The CommonsCancelled on Facebook and Why Are You Like This? on ABC iview.

FEATURES

In 2019/20 total expenditure on Australian features was $205 million, 36% below the previous year. A total of 19 titles commenced production with 17 domestic features including The Drover’s Wife: The Legend of Molly JohnsonStreamline and Penguin Bloom, and two Official Co-productions Falling For Figaro and The Power of the Dog.

The 19 features that started production in 2019/20 had total budgets of $259 million, with the largest proportion (79%) being made for under $10 million. The proportion of features being made in the sub-$1 million range has declined steadily over the last four years, while production in the $1-5 million range has remained relatively consistent. Despite the effects of the coronavirus pandemic, there was little change in the proportion of titles in each budget range.

Eight features that entered production in 2019/20 had their shoot interrupted due to COVID-19. Evidence suggests that nine features were reported to have been postponed, with total budgets estimated to approach $250 million.

Despite the challenges as a result of COVID-19, which also resulted in exhibition and cinema closures around the country, Australian feature films continue to be celebrated around the world, with Natalie Erika James’ Relic making its world premiere at Sundance Film Festival 2020 in January, High Ground and H Is For Happiness both selected to screen at Berlin Film Festival 2020 in March, Roderick MacKay’s debut feature The Furnace selected for Venice Film Festival 2020 in September, and Penguin Bloom recently premiering at Toronto International Film Festival 2020.

As Australia adjusts to COVID-normal and cinemas re-open across the country, audiences are again able to enjoy Australian feature films on the big screen with Tim Winton’s Dirt Music, animation film Combat Wombat, South Australian-shot Never Too Late and Jeremy Sims directed Rams all hitting cinemas in October 2020, The Furnace slated for cinemas in December 2020, and The Dry starring Eric Bana set for release in January 2021.

FOREIGN PRODUCTION

Total spend on foreign shoot and PDV-only titles came to $447 million in 2019/20, a strong result despite the effects of the coronavirus global pandemic. Foreign titles shot in Australia spent $283 million in the country, or 63% of total foreign spend, while spend on PDV-only titles rose to $165 million.

Eight foreign features commenced shooting in Australia in 2019/20, bringing $221 million in expenditure from titles from the US, South Korea, Germany, Nepal and Bangladesh. This result was 20% up on 2018/19. PDV-only feature expenditure totalled $33 million in 2019/20 from 15 features, down 70% on 2018/19’s decade high result.

Foreign TV and online drama activity accounted for $193 million in Australian expenditure in 2019/20, up 59% on last year, driven by spend on titles for VOD platforms. Eighteen titles contributed to this result, including the three foreign shoot titles Shantaram (The Bear) (US), Odd Squad series 3 (US/Canada) and Bad Genius (Thailand); and fifteen PDV-only titles including US titles The Mandalorian series 2, Rise of the Teenage Mutant Ninja Turtles series 2, What If…? and The Boys series 2. Some titles that commenced work in 2019/20 forecast significant spend in future years.

The Australian dollar typically traded at around USD $0.70, helping to attract a diverse range of foreign productions including higher-budget, studio titles, as well as several independent titles. The Australian Government’s Location Incentive supported two foreign dramas that entered production in 2019/20, Shang-Chi and the Legend of the Ten Rings and Shantaram (The Bear), and productions were also assisted by the federal Location Offset, and state government support. Increased PDV-only activity was supported by the Australian Government’s 30% PDV Offset, additional 10% rebates in NSW, Queensland and South Australia, and incentives offered in Victoria.

In June, the Australian Government announced a further $400 million in funding for the Location Incentive over the next seven years, and has announced funding for several projects. The NSW Government announced further funding in November to attract productions, and New South Wales is slated to host projects including Thor: Love and Thunder. Queensland production will be boosted by several titles, including three series scheduled to shoot back-to-back in the Screen Queensland studios. Several productions are scheduled to complete or commence production in Victoria, and the state announced a new incentive program in November. The Western Australian Government announced a new PDV rebate in September to compete with other states and foreign territories.

POST, DIGITAL AND VISUAL EFFECTS (PDV)

To provide a sense of the ongoing business activity of PDV companies in a given financial year, the PDV Services section of the Drama Report uses a different data timeline to the rest of the document. In this section, a project’s total PDV spend is reported as it occurs, rather than attributing the whole amount to the year in which work commenced. The data cannot be compared to that presented in other sections of the Drama Report.

PDV expenditure for 2019/20 was $337 million, up 26% on 2018/19 and 24% above the five-year average of $272 million. Driving the result was $172 million expenditure on Australian titles including Mortal KombatThe Power of the DogClickbait and Penguin Bloom, up by 11% on 2018/19. Expenditure on foreign titles undertaking PDV without shooting here totalled $130 million in 2019/20, up 34% on 2018/19, and PDV expenditure on foreign shoot titles for 2019/20 totalled $36 million, up 120% on 2018/19.

SCREEN AUSTRALIA

Screen Australia’s Annual Report was tabled in Parliament on 26 October 2020, and revealed that the agency provided more than $45 million in production funding for drama titles. That included $17.1 million for television drama, $12 million for features, $8.4 million for children’s television, $4.3 million for online drama productions and $3.5 million for Indigenous productions.

Additional funding was injected into the industry for drama development, documentary, talent development, distribution, international marketing, festivals and guild assistance, with more than $73 million in direct funding flowing to the sector through Screen Australia in 2019/20.

In conjunction with the Federal Government, Screen Australia responded quickly and comprehensively to the challenges presented by COVID-19 and implemented the following measures to support the screen sector.

  • Screen Australia was a part of the Australian Screen Sector Task Force that developed the Australian Screen Production Industry COVID-Safe Guidelines.
  • Created an Industry Resource Directory in collaboration with the Office of the Arts.
  • Contributed more than $1 million in emergency funding assistance to Screen Australia–funded productions forced to shut down or go into hiatus due to COVID-19.
  • Launched the Premium Plus fund by reallocating Production Investment funding to the Story Development fund to ensure that when production was viable again projects could get back up and running as quickly as possible. More than $2 million in funding across Premium Plus and the Premium Story Development fund was pushed out to the sector between April and June 2020.
  • Launched the COVID-19 Budget Support Fund to cover additional costs for green-lit productions to implement their COVID Safety and Risk Assessment Plans to allow them to go into production safely. The agency has provided an additional $6.4 million to date in funding to projects that could work remotely, or have needed help to start again and be COVID-safe. To date, Screen Australia has provided COVID-19 support funding to projects that have combined budgets of over $300 million.  
  • Administered the $50 million Temporary Interruption Fund announced by the Federal Government in June 2020, which has been allocated for 23 approved projects as at November 2020.

As part of the 2020-21 Federal Budget, additional funding was announced for eight national cultural institutions, with $1.1 million provided to Screen Australia. This funding will go towards supporting productions to continue to safely make distinctive Australian stories for the screen. Screen Australia also received $30 million over two years to support the production of local content and will also receive an additional $3 million over three years to cultivate quality screenwriting and script development.

This increase in support from the Government recognises the immense talent of Australian writers, directors and producers, and will enable Screen Australia to support quality and culturally important Australian film and television content, and support producers to find a pathway to audiences. Further details on how Screen Australia will use these funds to support the sector will be released in the coming months. In addition to this support package the Government also announced a series of reforms to the funding and regulatory framework that underpins Australian content. More information on these changes can be found here 

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