A recent distribution and marketing forum hosted by the National Film and Video Foundation (NFVF) in Johannesburg saw filmmakers, distributors, film financiers and other industry stakeholders gather to discuss the current market for South African films and the challenges in finding audiences and creating a sustainable industry.
Lehlohonolo Mokhosi, junior economic analyst at the NFVF, opened the NFVF forum with an overview of local box office trends. “South Africa is rich in policies and strategies for film production, however distribution and marketing are left behind,’ said Mokhosi.
Debbie McCrum, general manager of Nu Metro Films, noted that film attendance in South Africa has been “pretty much static’ over the past 10 years at 27 to 29 million tickets sold per year, although box office revenue has increased due to higher ticket prices, mostly due to the advent of 3D films.
Mokhosi added that box office statistics show local comedy, musical and animation had performed best at the South African box office in 2011. “Jock of the Bushveld made over R11m – that raised a flag that maybe there’s an opportunity in 3D animation. But it is difficult and expensive to produce.’
South African films had a 4.5% market share in 2011 compared to 11% in 2010; the difference can be explained by the absence of a Leon Schuster film in 2011, noted Mokhosi.
He asked whether South Africa can look at other countries in the SADC region to expand the market for South African films, and whether reducing ticket prices or increasing the number of cinemas could be a solution.
Distribution
In a session on independent film distribution and marketing in South Africa, McCrum said: “..the general feeling is still that you only have a successful film if you have theatrical release.’
This is problematic in a static market, and she suggested that filmmakers need to also look at other platforms such as the video on demand (VOD) space, although it is still in its infancy and expensive because of South Africa’s broadband rates.
“There is still revenue and potential in the DVD market, although DVD sales are down worldwide. Pirates are doing DVD distribution much better than we are; we’re not reaching the masses yet,’ said McCrum.
Helen Kuun of Indigenous Film Distribution agreed that South African filmmakers still fixate on big screen releases, although cinema attendance in South Africa was actually 16% down from December 2010 to December 2011. “All films are not meant for cinematic release,’ she noted.
However, McCrum emphasised that while cinema attendance in South Africa was the same or shrinking, the local market share had grown from 0.5% to 4.5%. “Look at where it was, I think that’s substantial.’
Kuun agreed: “In the past 20 years no South African film even made a percentage. Now we have an industry.’
She called the box office runs of local films Material and Semi-Soet a breakthrough. “Anomalies like these didn’t happen before. They’re taking audiences away from international films.’
In terms of box office trends she noted that (except for Spud and Leon Schuster) local films doing well have generally not been in English. “If you’re doing something different, you’ll hold a screen. Making a drama in English is actually more risky than doing it in an indigenous language.’
Kuun noted that certain genres of film will not double their box office even if there are 100 more cinema screens in South Africa. “South Africa has a cinema-going population of 5.5 million people, who go on average 4.5 times a year. You cannot show films to people that don’t exist. More cinemas will make a difference, there is value in expanding, it just won’t double box office revenue for local films.’
Kuun and McCrum agreed that a quota system for local film (as in South Korea) would harm local exhibitors and by implication, the local film industry.
A better option, suggested McCrum, was digital migration or digital expansion of film theatres. “Countries in Europe have used it as a way to transform their local industries. Governments converted screens to digital and unlocked them for local films by allowing easier access. Poland transformed itself to a 60% local market in this way.’
Funders
The NFVF’s Clarence Hamilton noted that NFVF-supported films such as Izulu Lami, State of Violence, Shirley Adams, Retribution, How to Steal 2 Million and Skeem had made only a fraction of their budgets at the box office.
“The majority of our films fail at the box office. It’s not that audiences don’t appreciate good quality storytelling – local television proves it. The question is, how do we translate that to the box office?’ asked Hamilton.
The Industrial Development Corporation’s (IDC) Basil Ford added that the sustainability of any structure has to depend on its ability to recoup funds. “We’ve funded about 50 films and only recouped from a handful. I don’t have the answers, but if we don’t find a workable model, at some point the funding is going to have to stop, that’s the reality of it. We’ve fixed up the production side of it, how do we fix the rest?’
Filmmakers in attendance, however, noted that theatrical performance should not be unfairly weighted, as many films eventually recoup, or come close to recouping, their budgets through avenues such as DVD, sales to broadcasters and South African Airways, and new VOD options such as DStv Box Office.
Another point was made that after the Department of Trade and Industry (the dti) rebate, most films only need to recoup 65% of their budgets, and some films receive soft funding as well. It was also argued that certain stories need to be told because they are important, and not because they are profitable.
Producer Jeremy Nathan (State of Violence, Shirley Adams) added that it was the responsibility of the NFVF and the IDC to build more cinemas and grow South Africa’s movie-going audience. “Built into the market structure is the failure of every South African film. We are making more and better films, but all of us are guilty of not fixing the distribution and marketing end,’ he commented.
Ford doesn’t believe building more cinemas is a silver bullet solution, but that filmmakers need to take into account the market and audience for local films before they start shooting. “The market should define the budget, not your artistic vision,’ he said.
Hamilton admitted that the film industry shouldn’t be purely profit-driven. “Not all films will or should make money, but enough films should make money to ensure that the industry can continue. It’s not in isolation.’
Zaheer Goodman-Bhyat of Light and Dark Films (Confessions of a Gambler, Skeem) noted that broadcasters are seen as primary distributors and investors in film in other countries, but are not present in the South African film industry, leaving a big support gap.
NFVF council member Trish Downing suggested that the industry push for pro-bono support of local films on local broadcasters. “Even if the film won’t air on that broadcaster, they can promote it as part of their local content quotas.’
Case studies
Several producers shared their experiences of the challenges and pitfalls in distributing local films. Producer Steven Markovitz talked about the distribution of Viva Riva! in 2011.
“Most producers tend to blame the distributors when the films fail, but producers need a lot more skills around distribution. With the online revolution, there’s a lot more we can do.’ However, he added that filmmakers are faced with an underdeveloped, fragmented audience and a lack of cinemas.
Goodman-Bhyat shared lessons he learnt from distributing and marketing Skeem.
“We’re in an interesting place because we’re creating a whole new world – no-one in South Africa has ever made a Semi-Soet before. If, for example, I knew three weeks before I started shooting Skeem what I know now, I would have made an all-ages film and I think it would have made a difference. I would also have loved better data in terms of dating the film. My suggestion is some kind of club where people who have data agree to share it.’
Nathan also shared his distribution experience. “I started out a bit like a communist; I wanted to change the world. But I realised I not only had a responsibility to my audience, but also to the people who put up the money.’
He believes slate funding is one of the models that can aid filmmakers by helping to amortise the costs of films and minimise the risks.
“We need to combine all our data in an open and transparent way. It’s not difficult to share the numbers, because the numbers are all bad,’ he added.
Freelance executive producer Kevin Fleischer (Otelo Burning) noted his experiences in distribution, specifically in international markets. “You have to work backwards, start by determining how much money the film can make before deciding on the production budget.’
He also suggested that filmmakers bypass sales agents and look at a hybrid model of distribution. “It has to be granular every step of the way. You have to segment audiences and think of how to reach each segment separately. Try to create partnerships and sponsorships, but do it at the beginning, not at the end of production. All marketing you do should feed back to your online campaign,’ advised Fleischer.
NFVF distribution
NFVF head of Production and Development, Thandeka Zwana, spoke about their experiences in distributing Retribution in 2011, their second foray into film distribution.
“Technically everything was done right, but it didn’t translate to box office attendance. We had a low budget, well-known cast members and rave reviews, but we still didn’t recoup.’
Nathan noted that the Independent Producers Organisation (IPO) was opposed to the NFVF’s involvement in distribution. “The NFVF cannot be both referee and player, it’s anti-competitive. Please support distribution, but not by entering the market,’ he asked.
Zwana noted that filmmakers need a choice of distributors, which is not being offered yet. “We are constantly looking for new models, and constantly looking for better ways to do things. We want to strengthen the value chain.’
P&A rebate
Fleischer noted that good progress was being made on creating a dti rebate for post-production spending, but that the industry also had a case for a print and advertising (P&A) rebate.
Dan Jawitz of Fireworx Media added that there is little financial support for distribution and marketing of films in South Africa – only a small budget from the NFVF, which does not support exhibition and festival attendance, and some support from the different film commissions.
He said that there had been a lot of discussion on a possible marketing or P&A rebate at the IPO. However, important questions remained such as whether it should be paid to the producer or the distributor of the film, and what expenditure should be rebate-able, such as prints, trailers, test-screenings and advertising.
In conclusion, the forum decided to request a workshop with the dti around a P&A rebate and asked the NFVF to lobby the SABC for greater support for film.
By Linda Loubser
Screen Africa magazine- May 2012
