BRITISH COLUMBIA FILM ANNUAL ACTIVITY REPORT A A Competitive Environment 2 B Industry Overview 4 C Film And Television Industry Value Chain 8 D A Catalyst For Industry Growth 12 E Program Activity 07/08 18 F Report On Performance 30 TABLE OF CONTENTS 1 he film and Throughout 2007/08 British Columbia publishers to explore content possibilities; Film continued to act as a catalyst for the · organizing the Multi Platform Incubator television industry by providing policy and financial conference (together with New Media BC) industry in support as well as by assisting the industry that looked at new media and film and British Columbia to understand the impact of change on television convergence; and its operating environment. BC Film remains · sponsoring the Digital Media Lab program faced a series committed to providing stable, focused and (with the CBC). of significant supportive programs that will allow the BC Film will continue to develop challenges in 2007/08. entrepreneurial skills of the industry and sponsor this type of initiative over to flourish. the coming years to help the industry The most important was In order to better define this role, understand the possibilities of multi- the dramatic increase in the British Columbia Film creates an annual platform content creation and delivery. value of the Canadian dollar. strategic service plan that addresses its During the past year, BC Film worked core responsibilities. These are to: with Telefilm Canada and other provincial This had the effect of increasing expenses · support the development and marketing agencies to ensure a Canadian presence at for US producers wishing to film in Canada. of high quality, commercially viable international film and television markets. When coupled with the creation of lucrative British Columbia film, television and Financial assistance was provided to allow filming incentives by many US States, digital media projects; BC companies to attend these events British Columbia became an appreciatively · sustain and grow a competitive BC owned in order to develop international co- more expensive location for American and controlled film and television and productions and to sell BC product into film production. In addition, a strike by the digital media industry; other markets. Writers Guild of America essentially shut · enable British Columbia production In keeping with our service plan down American controlled production for companies to foster existing, and establish commitment to identify opportunities for the a three month period. new, relationships with national and film and television sector to develop markets Given these challenges, the production international co-financing partners; and realize co-production agreement in numbers of almost $950 million represent · improve the ability of British Columbia Asia, BC Film encouraged and financially a considerable achievement by the industry production companies to secure supported a significant Canadian presence and indicate its resilience in responding to development and production financing at the Hong Kong Film Market, the largest difficult business conditions. and retain intellectual and financial control market in Asia. The Canadian Pavilion and The primary reason for the overall solid of content produced; program in Hong Kong were successful production numbers is the continuing growth · effectively administer provincial tax credit and Canada has made an initial three year shown by domestic industry. 2007 represents programs, ensuring that BC remains commitment to this market. the fifth consecutive year of growth in this competitive as a production centre and The development of British Columbia’s sector of the industry with production of continues to attract private sector film and television sector is the result over $400 million being generated by British investment; and of effective public policy supporting the Columbia based companies. · assist in the development of the creative creative and business skills of the industry. The continued growth in the domestic talent necessary to sustain industry growth. It is a powerful partnership. sector reflects the increasing ability of The provincial tax credit programs, For more than twenty years the essential A COMPETITIVE BC companies to develop and produce administered by BC Film, continue to be support provided by the government of quality content that is competitive in both effective drivers of production activity and British Columbia has allowed BC Film to ENVIRONMENT Canadian and international markets. This company growth. Again last year the impact assist both government and industry achieve growth is essential if BC is to continue its of the Digital Animation or Visual Effects tax their goals. We look forward to continuing transformation from a film location to an credit was notable. This program has made this role and contributing to a stronger, internationally recognized production centre. British Columbia internationally competitive more sustainable industry. In October of 2007 the provincial in attracting visual effects production and government announced its extension has been instrumental in repatriating digital of the film and television tax credits for a animation work that was being produced five year period. This decision was welcomed off-shore. by the industry but in December of 2007 BC Film also recognizes its role in MICHAEL FRANCIS both Ontario and Quebec announced bringing the creative community together in Chair, Board of Directors, significant increases in their tax credit order to benefit from content convergence. British Columbia Film rates. These increases, if not matched by BC Film undertook a number of initiatives British Columbia, would have resulted in last year to encourage this understanding. BOARD OF DIRECTORS 2007/08 an immediate and dramatic decrease in BC These initiatives included: MICHAEL FRANCIS, Chair production and the ceding of the Canadian · creating the Digital Readiness program COLIN BROWNE , Vice-Chair + Secretary/Treasurer industry to Ontario and Quebec producers. to help companies develop or implement NINI BAIRD The provincial government recognized the digital content strategies; GORDON ESAU serious nature of this threat to the industry · organizing the “Opening the Book on BRIGITTE PROCHASKA and in January announced that it would Film” conference which brought film and GERRY RUTHERFORD match the tax credit increases. television producers together with book SHAN TAM 2 A Shine of Rainbows, Sepia Films, Photo: Harry Kerr · (Previous spread) Robson Arms, Omni Film Productions, Photo: Katie Yu 3 LEVEL OF PRODUCTION otal British Columbia film and The film and television industry in British Columbia is made up television production spending of two distinct yet complementary types of production – domestic in BC was $943 million in and service. 2007, marking a decrease after SERVICE PRODUCTION remaining steady over the previous · initiated, owned and controlled by producers from jurisdictions 2 years. This decrease was outside of Canada · primarily interested in British Columbia as a production location attributable to a drop in foreign production · highly mobile due to the consistently strong Canadian · expends money on a project by project basis dollar, increased competition from other film · hires local talent and crew · key creative decision-making remains with the foreign producer jurisdictions and American film industry labour unrest. 64 service productions – with a BC DOMESTIC PRODUCTION production spend of $536 million – were shot · created, developed, owned and controlled by British Columbia production companies in British Columbia in 2007. · makes long term investments in corporate infrastructure In contrast to the drop in foreign production, domestic production · hires British Columbia key creative talent and crew saw a significant increase from $278 million to $408 million. · contributes to stable employment levels This impressive increase continues the trend that has seen domestic · provides opportunities for BC content creators to find a national production spend grow 242% over the past five years. 138 domestic and international audience productions were shot in BC last year, including 24 feature films, 24 television series, 80 television projects and 10 animated series and projects. FILM AND TELEVISION PRODUCTION IN BRITISH COLUMBIA 1997 – 2007 1,600.0 1,400.0 Service Spend in BC Domestic Spend in BC 1,200.0 TOTAL 1,000.0 800.0 600.0 400.0 MILLIONS OF DOLLARS CANADIAN INDUSTRY 200.0 0.0 OVERVIEW 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 424.5 444.8 665.0 760.9 856.9 830.0 1,235.8 587.3 1,008.9 950.1 535.60 206.0 363.2 405.0 419.4 251.6 163.6 168.8 213.9 224.8 277.8 407.70 630.5 808.0 1,070.0 1,180.3 1,108.5 993.6 1,404.6 801.2 1,233.7 1,227.9 943.3 4 They Wait, Brightlight Pictures & Koster Kovitz Productions, Photo: Katie Yu 5 Service = 56.8% Domestic = 43.2% COMPETITIVE ADVANTAGE Tax incentives are the common currency that draws film and television production to various ECONOMIC IMPACT FILM AND TELEVISION locations throughout the world. While international INDUSTRY – ECONOMIC IMPACTS competition is intense, the British Columbia tax ilm and television production is a credit programs – Film Incentive BC and the DIRECT desirable global commodity due Production Services Tax Credit – continue to act to a multitude of economic impacts. DEVELOPMENT/ as the key determinant of film and television production in There are many channels through PRE-PRODUCTION the province, serving to keep British Columbia competitive