Motion picture production: A micro-budget model By Richard Owen An exegesis submitted in fulfilment of the requirements for the degree Doctor of Philosophy School of Business Federation University University Drive, Mount Helen Victoria, Australia Submitted: December 2016 Principal Supervisor – Associate Professor Elisa Backer Associate Supervisor – Dr Jacqueline Tuck ABSTRACT The film industry plays an important cultural and economic role in Australia. However, the film industry in Australia has struggled for many years under a subsidy-driven government intervention process that creates a high degree of dependence on a subsidy-centric model. Motion picture production costs worldwide have risen dramatically over the last decade with Hollywood production budgets commonly exceeding $100 million. Australia as a nation has a proven capability to produce respectable motion pictures at varying production budgets, although this capacity has become entrenched with taxpayers’ money. Historically, subsidy-driven industries in Australia trend towards collapse due primarily to cyclical fiscal deficits and changing funding imperatives at the Commonwealth level. As a PhD by exegesis, the focus of this research was to create, as well as evaluate, a new model of film production that would not be dependent on subsidies. This study evaluated a number of factors that were relevant to establishing a viable micro-budget model. Micro-budget films have received little research attention, with the focus being on major films. This research examined an alternative model, through the creation of a feature-length micro-budget film, called Stakes, and assessed it across a range of criterion to determine whether Australia’s film industry could be strengthened and potentially become self-sufficient. The resulting motion picture premièred in Australian cinemas on October 29th 2015. The justification, methods and results are discussed in detail throughout this exegesis providing strong evidence in favour of the viability for a micro-budget segment in the Australian film industry. Such a model could reduce the risk of Australia’s film industry collapsing if subsidies are reduced or abolished. Thus, this research has significant implications for Australia’s film industry and also contributes strongly to scholarship through providing crucial information on micro-budget films. DECLARATIONS Declaration 1: I hereby certify that some elements of the creative work Stakes (Owen, 2015), which has been submitted as part of this PhD, were created in collaboration with others who are duly acknowledged in the opening and closing credits of the aforementioned motion picture. STATEMENT OF AUTHORSHIP Except where explicit reference is made in the text of the thesis, this thesis contains no material published elsewhere or extracted in whole or in part from a thesis by which I have qualified for or been awarded another degree or diploma. No other person’s work has been relied upon or used without due acknowledgment in the main text and bibliography of the thesis. Signed: _________________________________ Signed: __________________________________ Dated: 23 December 2016 Dated: 23 December 2016 Richard Owen Associate Professor Elisa Backer Candidate Principal Supervisor Acknowledgments I would like to acknowledge and thank the following people for their invaluable support throughout the course of this research project. The ongoing support and patience for the duration of the research provided the impetus for its success. I am particularly grateful for the commitment made by my principal supervisor, Associate Professor Elisa Backer, for her willingness to embrace the challenges of supervision on such a large project. Her continued encouragement and guidance was instrumental in ushering this Exegesis to its current standard. I would also like to thank Dr Jackie Tuck, my associate supervisor, for her continued patience during the written component of the research, as well as her ability to swiftly resolve the various administrative challenges during the course of my candidature. I am also exceptionally grateful for the assistance provided by Associate Professor Bradley Mitchell, particularly in respect to his expertise in astutely navigating the competing expectations within the academic writing component. In particular, and with an enormous sense of gratitude, I would like to thank all the participants who contributed their time and energy to produce the motion picture Stakes. Finally, I would like to acknowledge my family, friends and associates who in some cases experienced extreme hardship as a direct result of my absence, and the decision to pursue a project of this scale. Table of Contents LIST OF TABLES……………………………………………………………………………………….……..……IX LIST OF FIGURES………………………………………………………………………….…………………..……X LIST OF APPENDICES……………………………………………………………………………………..…….XI LIST OF ABBREVIATIONS……………………………………………………………….………………..….XII CHAPTER ONE - INTRODUCTION ............................................................................................... 1 1.1 INTRODUCTION ........................................................................................................................................... 1 1.2 OVERVIEW OF THE FILM INDUSTRY ........................................................................................................ 1 1.2.1 Film production ............................................................................................................................................................ 1 1.2.2 Cinema attendance ...................................................................................................................................................... 3 1.2.3 Viewing Platforms ........................................................................................................................................................ 4 1.3 BACKGROUND TO STUDY ........................................................................................................................... 4 1.4 THE FILM ..................................................................................................................................................... 6 1.5 RESEARCH APPROACH ............................................................................................................................... 8 1.6 AIMS AND OBJECTIVES ............................................................................................................................... 9 1.7 STRUCTURE OF THE RESEARCH ............................................................................................................... 9 1.8 CONTRIBUTION OF THE STUDY .............................................................................................................. 10 1.9 CONCLUSION ............................................................................................................................................. 11 CHAPTER TWO - LITERATURE REVIEW ................................................................................ 13 2.1 INTRODUCTION ......................................................................................................................................... 13 2.2 OVERVIEW ................................................................................................................................................. 13 2.3 HOLLYWOOD STUDIO SYSTEM ............................................................................................................... 17 2.4 MICRO-BUDGET FILMS ............................................................................................................................ 18 2.4.1 Independent films ........................................................................................................................... 19 2.4.2 New World Pictures ....................................................................................................................... 20 2.4.3 Nollywood .......................................................................................................................................... 21 2.5 MOTION PICTURE PRODUCTION ............................................................................................................ 24 2.5.1 Production costs .............................................................................................................................. 25 2.5.1.1 Above the line costs .............................................................................................................................................. 25 2.5.1.2 Below the line costs .............................................................................................................................................. 26 2.5.1.3 Contingent costs ..................................................................................................................................................... 27 2.5.2 Concept and story ........................................................................................................................... 29 2.5.2.1 Treatment and script ........................................................................................................................................... 29 v 2.5.2.2 Genre ........................................................................................................................................................................... 32 2.5.2.3 Classification ...........................................................................................................................................................