A key role of a producer is finding the money for a project, but in today’s rapidly changing marketplace it’s a complex task. To provide up to the minute information on revenue streams and sources of finance, Victoria University’s Executive Producer course brings industry legend Tait Brady to the podium.
Brady provides an intensive briefing on how to pick your way through the maze of financing, how revenues are generated and flow back to a production, and particularly what distributors, sales agents and broadcasters are looking for.
Tait explains that the way revenue is shared after a film is released has always been something of a black art. There is a lot of misinformation bandied around, and distributors and sales agents are often reluctant to provide specific information on revenue streams.
“In the past, producers didn’t have much motivation to explore the issue,” says Tait. “They knew that there wasn’t much chance that they or their investors would ever seeing revenue coming back after the film went into profit. So their focus was firmly on their production fees and getting the film over the line, rather about what happened after the film was made.”
But the Producer Offset has changed all that. “The Producer Offset is a game-changer,” announces Tait, “shifting the responsibility away from distributors and sales agents and towards producers.” Now, the offset provides a way in which producers can retain equity in their project, and returns from completed films can become a significant part of their business models.
So producers need to get their brains around the various ways their project can be financed, and the revenue streams that flow as a result. Tait says that it can be difficult to find out about this area, so he provides an in-depth analysis, citing recent examples such as the feature film Mao’s Last Dancer, based on published information and estimates of revenue from DVD sales etc.
Another recent game-changer was the Global Financial Crisis, which saw sales agents going out of business, or dramatically reducing their ability to provide presales for films. According to Tait, it was only at this year’s Sundance Film Festival that there were signs that sales agents were again in a position to invest in films before they are made, a crucial element of a film’s financing.
“A cinema release is vital as it’s still the best way to launch a film into the marketplace,” says Brady. “A successful release increases the value of a film in other markets, which may include sales in overseas territories, plus free to air TV, pay TV, DVD, airline rights and even video on demand, which is going to become more and more important in the equation.”
And if a producer plans to utilize the Producer Offset, they need to be aware of how a distributor subtracts the print and advertising costs from their share of returns, and what that means. During the course, Tait explains the elements that make up the P and A spend, as well as the distributor’s commissions to be taken out before income goes back to investors.
With a wealth of experience heading the Melbourne International Film Festival, working as a distributor (Palace Films) and as Evaluation Manager at the FFC, Tait Brady is ideally placed to provide an overview of release patterns over the past twenty years, as well as current and emerging trends.
“Recent changes to the Producer Offset rules have lowered the QAPE threshold for feature films,” he advises, “which means that low budget features of $500,000 to $600,000 are now viable. So it’s an area being considered by many producers now.”
The course also covers revenue streams in television, where producers still deal with sales agents, but they are different people to the film world, and the goals are also different. “In Australia television is driven by the broadcasters,” he advises. “It’s all about the broadcaster, whereas in the film world the agencies wield much more influence.”
“In the Producer Offset era, it’s become even more crucial that producers understand the revenue streams, and how to present their project to potential investors,” he concludes. “It’s the producer’s role to take custody of those issues for the life of the film, yet it’s an area that is often overlooked.”
Victoria University’s Executive Screen Producers Course will be taught by leading industry practitioners on alternative weekends in Sydney and Perth. Current dates in 2011 are: Sydney 11-13 November and 25-27 November; Perth to be advised.
For more information, or to register, phone 03 9919 1810 or email esp@vu.edu.au.
