Live action filming within the screen industry is in an extraordinary state of disruption. The eyes that rolled during our recent LA meetings every time someone voiced the hope to “survive ’til ’25” were a confirmation. Tinseltown has lost some shine.
The expectation of more runaway production we shared in our blog last spring is already happening in film hubs worldwide. In a “Race to Nab Film and TV Productions”, the Hollywood Reporter writes that foreign locales are luring projects away from California. Lower net production costs around the globe – enhanced by a myriad of rebates and refunds – are determining if an increasing number of projects are made or not.
Budget cuts and staff layoffs have streamers and studios struggling to satisfy audience expectations shaped during the golden age of Peak TV. The revelation that the streaming wars left most of these gatekeepers deep in the red was a wake-up call for content creators. Their emperor had no clothes.
Advertising To The Rescue?
Streamer income with advertising will nearly double the growth without advertising by 2029. That forecast by Ampere Analysis’ Guy Bisson is high on the list of MIPCOM ’24 takeaways reported in Variety.
This outlook suggests increased demand for the expertise of the commercial production industry. Nothing could be more welcomed by the production companies rattled by profound changes to business models that have forced some to shut down and many others to downsize. Their capacity to foster directorial talent is fundamental to the screen industry. Let’s not forget that Ridley Scott, Michael Bay, and David Fincher all cut their teeth in commercials.
Commercial production companies are up against in-house production divisions at brands and agencies under pressure from holding companies to increase profit margins. The in-house teams are tapping into freelance directors as a workaround that undermines the future of film and television as it cannibalizes creativity. The disruption compelled the Advertising Producers Association (UK) to commission an independent study to demonstrate “What Clients Want From Advertising Production Today And How They Can Get It”.
Producers at brands, agencies and production companies mixed and mingled at recent Association of Independent Commercial Producers (US) events in LA and Atlanta attended by PSN US Liaisons Carolyn Hill and Amanda Rosenberg. Increased screen time on streamers can bolster the production of commercial films so there’s much to be gained by candid communication and cooperation between them.
The very value of creative ideas is under scrutiny in advertising. During her recent attendance at Ciclope Festival in Berlin, PSN UK Liaison Pippa Bhatt discovered a room abuzz with conversations about Germany agencies and brands now agreeing to pay production companies for the treatments prepared by their directors. The AICP and APA are exploring this approach for their US and UK membership respectively.
And that’s just a sampling of the challenges prompting many screen industry professionals to rethink the path of a project in hand, if not their very career.
Where to Thrive in '25
The industry insights flooding my LinkedIn feed ultimately point toward this thought from Reid Hoffman, the co-founder and executive chairman of the business-oriented social network.
“The best way to predict the future is to create it, and the best way to create it is to pivot.”
Just ask Jamie Foxx. He’s been recording the Beat Shazam game show in Dublin with US contestants before an Irish studio audience. The Academy-award winning actor told local media that the world has changed and that “everybody’s going to do a game show”. Things that make you go hmmm.
Cost savings in foreign countries drove the producers of Beat Shazam to film on a Ireland soundstage. They’ll have good reason to stay once the European Commission approves the Irish government’s boost to its incentive designed to keep it on par with the UK for scripted programming. Ireland’s plans also include the first rebate in the EU for unscripted programming – including game shows!
Numbers talk. They compelled the makers of Ridley Scott’s Alien:Earth to film the entire series with our PSN Thailand Partners. And they drew Gerard Butler to film Den of Thieves 2: Pantera on location in the Canary Islands with the team at PSN Spain. Film and high-end television producers hunt down the best deal.
US and UK producers on the recent PSN filmmaker FAM trip to Colombia were impressed to learn that the country’s incentive of 35-40% had convinced the makers of Paddington in Peru to film most all Peru scenes in Colombia. Film incentives enhance the low net cost of production in many foreign film hubs.
PSN has helped producers identify the most suitable locations to film since its inception. And while creative counts – A LOT -, money makes our world go around. We’re positioned like no one else in the screen industry to share timely and relevant intel from production trenches worldwide. What better way to equip filmmakers to choose where best to shoot and whom to trust locally to execute live action filming?
From my seat at the helm of PSN there is nothing more satisfying than applying our Network’s local knowledge to the creative and cost challenges filmmakers grapple with. Consider a sampling of what we’ve revealed to producers and executives in our recent work with them behind the scenes:
- Demonstrate how filming with PSN Morocco or PSN Egypt will keep a budget-challenged indie feature on or below its target spend.
- Receipt of a 20% cash rebate on local spend made by a UK agency through PSN Uruguay in the production of a commercial doubling Montevideo for a US city.
- Identify multiple countries where the reshoot of a critical transition sequence for a US studio feature can be executed.
- Connect a Canadian producer with PSN Czech Republic, PSN Hungary, and PSN Austria to arrange the co-production of a feature set in Europe for a US streamer.
The Creative Balance
Authenticity resonates with the audience. There’s a vital human connection to real life landscapes and cityscapes, as well as the life that naturally inhabits them.
The 11th Annual LMGI Awards we attended in Los Angeles showcased this with winners filmed outside North America including limited series Ripley or feature Mission Impossible: Dead Reckoning Part 1.
Location filming magic is also on display in recently released commercials for Chloé filmed with our PSN Chile team and Wempe executed by the team at PSN Turkey.
Directors like Guy Ritchie tapped into the spirit when filming at the base of the Giza Pyramids with support from the team at PSN Egypt for his Fountain of Youth feature staring John Krasinski and Natalie Portman.
To capture iconic London for the opening sequence of Warner Bros.’ series Dead Boy Detectives, US filmmakers shot three nights in the British capital with support from our PSN UK Partners. Korean producers leaned on the local support of our PSN Indonesia team to stage an uplifting final act in Bali for their Netflix feature portraying refugee drama, My Name Is Loh Kiwan.
Hyundai car makers traveled to one of Europe’s darkest cities with film support from PSN Norway to put their new IONIQ 5 N to the ultimate challenge of beating the winter blues. A healthcare battle to prevent cervical cancer drew the Bill & Melinda Gates Foundation to a community of Inner Mongolia at high risk. Our PSN China team worked remotely with FCB New York to produce a film disarming social stigmas and encouraging lifesaving vaccinations.
Shooting in costly film hubs remains a draw to meet the demands of celebrity talent. But consider how the scenes our PSN USA East-West Partner serviced for this Axe commercial featuring Coi Leray and Metro Boomin’ were the only ones shot in LA. The rest of the commercial was filmed in Poland.
The cost to film A-list talent at home can blow a budget out of proportion. Film and TV producers we’ve spoken with expect that fewer and fewer Hollywood heavyweights will win over studio heads amidst reminders like Joker 2: Folie à Deux. Industry reports suggest that filming the DC feature in London rather than LA could’ve saved the box office disappointment 20% of its production budget.
Local talent in multiple film hubs are up to the task. Advertising Executive David Droga spoke of leaning into craft at Ciclope Festival and underlined the success that comes from putting trust in the makers. Check out the cinematic execution of these commercials filmed with our teams at PSN Bulgaria and PSN Lithuania.
Entertain More For Less
From top to bottom, our industry is charting a path through industry turbulence. The Hollywood Reporter notes that After Trump Win, Hollywood Prepares for Megamergers – and Volatility.
Development executives in Hollywood tell us that industry contraction is already compelling them to follow a path well-trodden by the creatives crafting commercial campaigns – double down into local storytelling that can resonate beyond borders.
Film and TV development slates in Hollywood are now leaning into projects more readily executed abroad at lower cost.
At the same time, streamers are channeling increased funds into film and TV production for strategic growth markets from East Asia to Africa and Europe to Latin America to gain more subscribers.
The very execution of these projects beyond the confines of Hollywood acts as a global force for inclusivity and cultural understanding propelled by streamers making stories available to a global audience. The industry economics driving this trend are supercharging the power of storytelling. “By supporting marginalized communities and investing in diversity-focused initiatives, we are not only fostering creativity but reshaping the industry to reflect the richness of its audiences,” underlines AFCI Executive Director, Jaclyn Philpott. This was a profound takeaway from the AFCI Week Film Industry Challenge – Amplifying Voices, Transforming Futures: Navigating Disruption in the Film Industry.
Better budgets abroad are enabling creatives in these territories to spread their creative wings. Japanese producers of two separate series are working with our PSN Partners in Indonesia and Mexico. The makers of the MENA hit series, Finding Ola, scripted a trip to Paris executed with film support by PSN France for their season 2 on Netflix.
Demand outside Hollywood is driving investors to build new soundstages in New Zealand and the UK. There are new stages and backlots for Morocco and Spain too. This better positions our PSN Partners in New Zealand, UK, Morocco, and Spain to manage the increasing demand for stage space. Amidst Hollywood’s belt-tightening, I was pleased to share this tangible growth as cause for optimism with filmmakers and film commissioners during a recent panel at AFCI Week in Los Angeles.
North American executives are increasingly looking abroad. Last month in Madrid saw Universal International Studios, Sony Entertainment Television, Gaumont, Globalgate, and Anonymous Content participate in Iberseries y Platino Industria.
An Industry Built on Cultural Collaborations
“Producers play a crucial role as cultural diplomats, fostering understanding and collaboration between nations and cultures,” shared Amazon Head of Physical Production Glenn Gainor following in-depth discussion with Her Excellency Ambassador Leyla Abdullayeva of Azerbaijian at the recent Producers as Diplomats event of Producers Without Borders in Paris.
AFCI’s Philpott advocates “engaging policymakers and demonstrating the cultural and economic value of film” to secure vital support for our industry’s future.
Diplomats of Spain have enabled the country to reap the rewards of reciprocation. Deciding to boost the country’s film incentive as the screen industry emerged from the pandemic, they orchestrated their Prime Minister’s visit to Hollywood and a red-carpet reception in Madrid of US streamer and studio executives. Spain’s Queen Letizia was on hand to greet them in Spain’s capital city. A newly released study by Olsberg SPI now shows the country is enjoying an astounding 9 to 1 return on its investment that translates into revenues and jobs.
The trend is global and shows no signs of slowing down. During this year alone, there are new rebates or boosts to existing rebates in more than a dozen territories where our PSN Partners facilitate filming. Content creators prepared to pivot as our screen industry evolves are at an advantage.
In the words of Charles Darwin, “It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.”
“Stay in the mix ’til 2026” was the slogan heard on the Croisette during MIPCOM ’24. For producers of projects aiming to film abroad, PSN and its Partners are with them every evolutionary step of the way.
