Foundation is a catalyst for the growth of SA film

THE National Film Indaba, which takes place once every four years, has the goal of achieving unity of purpose and charting a way forward for South Africa’s industry,” according to Zama Mkosi, CEO at the National Film and Video Foundation (NFVF).

She says while the local film industry has yet to achieve an ideal state of unity there is a strong willingness among stakeholders to work together for the benefit of growing the South African film value chain.

“The National Film Indaba provides a key opportunity to gain input from all the industry stakeholders through discussion and consultations to develop the industry, including the development of a South African Film Industry strategy that will respond to the changing policy environment in the light of the National Development Plan, the Department of Arts and Culture's adoption of the Mzansi Golden Economy and the draft White Paper on Arts, Culture and Heritage by the Department of Arts & Culture, and policy developments in the ICT sector,” says Mkosi.

She explains that the NFVF acts as a catalyst for the development of the country’s film industry and uses the National Film Indaba to make the process as inclusive as possible and to encourage a transparent and honest appraisal of a range of issues that impact on the industry’s advancement including: the extent of government support for the industry; local and international experiences that support the growth of South African filmmaking; the advantages of film production in South Africa for international productions; infrastructure development within the industry; the South African film distribution chain and the challenges of distribution; the promotion of film content for local television; redressing past imbalances in the industry; funding and financial resources; skills transfer and development; and growing audience support for local films.

“This will be the industry’s fourth National Film Indaba and comes at an important time, because the industry has come a long way in its development.

“There has been much change in the markets, technology, macro-economic factors, and government policy framework within which the film industry operates,” says Mkosi.

“All of these changes pose both challenges and opportuni- ties for the industry to respond to in a proactive and creative manner that ensures we take advantage of the current conditions and contribute to the country’s development,” she adds.

Mkosi says critical issues facing the industry include transformation and skills development, infrastructure development with regards to both film production and distribution, and funding.

She is upbeat about the industry’s outlook, pointing out that the first-ever national study of South Africa’s film industry based on verifiable information has shown that in 2012 the industry contributed R3,5-billion to the national economy.

“The South African Film Industry Economic Baseline Study research, commissioned by the National Film and Video Foundation (NFVF), and conducted by Deloitte, found that the industry ‘more than pays for itself ’ with payments to the South African Revenue Services (SARS) of more than R670-million, a figure R420-million more than the estimated R250-million Film and Television Incentive paid by the Department of Trade and Industry in 2012.

“The industry created a total of 25 000 full-time equivalent jobs in 2012, and, showed a multiplier of 2,89, which means that for every R1 spent in the film industry, an additional R1.89 is generated in the industries that service the film sector and ancillary in- dustries like hospitality tourism,” says Mkosi.

The South African Film Industry Economic Baseline Study indicates the industry has grown 84 percent in the past five years and says that to ensure sustainable growth over the long-term, the focus on commercial viability is essential.

However, Mkosi points out many high-quality films are not recouping their costs because of the current distribution model and South African cinemas do not deliver significant revenues for local films due to a small cinema-going audience.

She says the baseline study says South African film producers feel that exhibitor costs are too high to allow for recoupment of production costs. However, according to discussions with exhibitors, cinemas tend to breakeven on film ticket sales, and often make their margins in other areas of the business like refreshments sales.

Another reason put forward for films not recouping their costs is short flighting windows. Cinemas operate a system whereby films are booked in cinemas for a limited period of time and are only kept on the circuit if the films make minimum attendance numbers. The demographic that attends cinema is still largely an audience that watches Western content. Local films are competing against these films which are made with far higher budgets and A-list stars. There are thus very few films that can successful stay on circuit for any meaningful period of time to allow for decent box office revenues.

As the main box office revenue earners for local cinemas are foreign films, much of their resources are directed at optimising the awareness and subsequent attendances of such films. This can result in limited release cost funding, low marketing levels, low awareness of local films amongst audiences, and consequently low local box office sales.

There are, however, initiatives been driven by cinema owners, the NFVF, and entrepreneurs to address these issues including: cinemas with lower ticket prices; mobile broadcasting units that take the cinema to townships; informal cinemas that have been developed in community halls and other township buildings where movies are broadcast for a small admission fee; and developing digital cinemas within townships.