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Screen Industry Survey: 2010/11
Embargoed until 10:45am  –  02 April 2012
Commentary

Screen industry turnover just shy of $3 billion in 2011

Higher revenue from film production and television broadcasting pushed gross revenue for the screen industry to $2.999 billion in 2011. Just under half of all revenue came from the production and post-production sector, which is responsible for content creation. While post-production revenue fell 25 percent from its 2010 high, increased production revenue saw the sector generate $37 million more than in the previous year.

Broadcasting revenue rose in 2011, up 7 percent to $1.248 billion. This sector makes up 40 percent of the gross revenue of the screen industry, and includes free-to-air and subscription broadcasting. Exhibition revenue also rose 6 percent to $162 million, due in part to ticket sales from 3D films.

Graph, Gross revenue of screen industry businesses, by industry sector, 2008 to 2011 financial years.

Greater gross revenue was not due to more businesses entering the industry. The number of screen industry businesses has decreased since 2010, but the number with revenue over $1 million has gone up. There were 180 businesses earning over $1 million in 2011, 18 more than in 2010. The majority of these businesses were in the production and post-production sector.

Film and television the bread and butter of content creation

The number of feature films produced may look small at just 35 completed in 2011, but the impact they had on the industry was significant. Half of all production and post-production sector income for the year came from film making. This alone generated $707 million for New Zealand businesses. This was 15 percent more than in 2010. This was largely due to a five-fold increase in sales income to $116 million, most of which came from overseas. As film projects may take significant amounts of time to complete, production activity and sales revenue may be seen across multiple years.

Graph, Gross revenue of production and post-production sector businesses, by production format, 2008 to 2011 financial year.

While just 84 businesses were responsible for producing feature films, over a thousand other businesses provided contracted production and post-production services. Forty-three percent of all screen industry businesses worked on films during 2011. Many of these were sole-traders.

Almost half of all screen industry businesses worked on television programmes over the same period, generating turnover of $494 million. Although this is 5 percent less than in 2010, it seems that this is a return to normal levels after a spike in television revenue during 2010. Given the project-based nature of the screen industry, such spikes in revenue are not uncommon.

International revenue rises for first time in four years

In 2011, total international revenue rose 17 percent. This was the first rise since 2008. This was due to a 30 percent increase in revenue from North America. Revenue from North America was $387 million in 2011.

Just over half of the $387 million from North America came from financing and funding (investment received by a producer prior to the completion of works). There was no real change in financing and funding from North America compared with 2010. Over a quarter of revenue from North America ($106 million) was generated by those contracting production and post-production services. This was double the amount received the previous year. The remainder came from sales and royalties received for completed works. This was also double that received in 2010.

Graph, Sources of revenue in the production and post-production sector, by region, 2008 to 2011 financial years.

Revenue from other international sources fell a total of $22 million in 2011. The main exception was Europe, which remained constant at $11 million.

The 2011 survey collected data about international co-production arrangements for the first time. In 2011, 120 works were completed. The countries that New Zealand businesses co-produced projects with were fairly evenly split between Asia, Australia, and North America.

Graph, Number of co-production partners business relationships, by country/region, 2011 financial year.

Regional profile cements picture of specialisation

Core regional infrastructure has largely defined Auckland as the base of broadcasting and television production in New Zealand, while Wellington is the hub for film production.

Gross revenue for Auckland-based businesses rose $135 million to $2.297 billion in 2011. More than half of it came from broadcasting revenue. This was up 7 percent, to $1.244 billion. Auckland-based businesses also generated $675 million from production work in 2011. This was a 20 percent increase from 2010. While the majority of this revenue came from television productions, the increase in production and post-production revenue was in fact due to greater sales revenue from feature films.

Graph, Gross revenue of production and post-production sector, by region, 2008 to 2011 financial years.

The vast majority of revenue for Wellington-based screen industry businesses came from feature film work, which was worth almost half a billion dollars in 2011. This was an overall increase of 5 percent, with production revenue recovering most of its 2010 fall. Post-production revenue from these businesses fell from its 2010 high, but still accounted for three-quarters of the country's post-production revenue. Such movements are not uncommon given the nature of large project-based film productions. 

The fall in the number of Wellington-based businesses from 1,248 to 924 is explained by the project-nature of film works. Many businesses are established for the duration of a project and close down when it is completed.

Revenue for South Island-based business rose 17 percent to $91 million. Most of this increase came from production and post-production, particularly from increased revenues from television programme and feature film work.

For more detailed data see the Excel tables in the ‘Downloads’ box.

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