The annual drama report from Screen Australia contains the best statistics in the industry with no sense that the numbers themselves are shaped for an ideological approach. It is just good solid data, well laid out, with the bonus of a complete list of productions measured.
The report has a couple of disadvantages. First, as many researchers have argued over the years, the data is frustratingly general. In just one example, the average per hour cost of television drama continues to climb, but independent companies are not seeing this in their revenue. Screen Australia sees a lot of budgets and CVs, but of course that information is confidential. Etc.
As always we have to say that the figures assign expenditure to the first day of principal photography, in line with an international convention to provide wide, long runs of data. But they create accidental peaks and meaningless troughs which tell us nothing about the employment and cashflow of industry members. What looks to be a lull can simply mean that rival large shows financed at the same time are scouring the sector for crews.
Overwhelmingly, the figures of the last five years have bounced around inside a range. There is not much sense of sustainable growth or of lasting collapse. If we look closely and use constant dollars, the 2018-19 numbers are even less spectacular but they do tell a story of an industry with plenty of momentum at a certain scale. There are some confining forces which help – the dollar goes up and down, studios make guesses about future changes, broadcasters have defined budgets, and sprees are controlled.
For Screenhub the real headline is this: despite so many downward forces, the Australian screen sector continues to produce at a particular scale. It turns out to be enormously resilient at an aggregate level.
It has managed to do this over five years of enormous change. We know them well – the streaming companies arrive, compete and evolve; the commercial broadcasters care less about drama and none about children; digital production keeps morphing; the government broadcasters are being hammered; small screens have taken over; the brain drain increases year on year; and a whole new generation is replacing its parents.
We think the sector has the right to tell a very good story, which is not quite the good news that Screen Australia extracts. It is, after all, fighting to increase the credibility of the sector with government and the wider population, to chase myths away with positive comparisons.
Here is the big picture from Screen Australia:
Children’s TV drama is a good story in dark times. There were fifteen titles in 2018-19 against a five year average of 13 for a total of $95m, which is almost a third more than the next highest amount in the last five years.
Really the numbers are sustained by the ABC which is continuing to invest in live-action shows for young people despite the crushing loss of government income. As the report says,
15 children’s dramas entered production in 2018/19, generating a five year high of 132 hours of content, at a total cost of $105 million. The Australian spend of $95 million was the highest since 2008/09. Number of title, hours, budgets and spend for the total slate were all above five year averages, and live action production significantly increased to 61 hours, the highest level since 2012/13.
Eight of the fifteen titles come from the ABC, which will probably be repeated next year. All of six come from the combined might of the commercial networks which are allowed to average their expenditure over three years, so this number probably represents most of the expenditure until the middle of 2021.
There were seven live-action shows adding up to 61 hours costing $46m at $754,000/episode, and eight animations filling 72 hours for $59m or $828,000/episode. All but one of the commercial shows were animated while the live-action belonged to the ABC. The average cost per hour is now $40,000/hour under the five year average, which is a symptom of stress.
Screen Australia tends to record the projects which are conventionally financed, and ignores credit card shows, indy-indy docs and wildcat web series, for instance. This last year, the number of Australian features recorded was 33, actually the lowest in five years. But expenditure of $299m is about 20% up on the five year average.
We have almost given up on official sub $1m features, which does look like a genuine trend from nine to two after a peak of 19 two years ago. The $1m to $5m space has dropped out too, down ten per year to 14 last year. Again, it looks like a genuine retreat. Nine features were made for $5-10m, which is almost double what we would normally expect.
The $10m+ space (a huge range) has a lowish 5 titles, but the expenditure is all over the place because it is open-ended.
So we can say that budget targets are rising steadily as shows desert the sub $5m space but stay under $10m. Over the last five years those numbers have been 90%, 92%, 88%, 78% and 83%. The corresponding percentage of projects over $10m runs like this: 10%, 8%, 12%, 22% and 17%. That is an encouraging run but still low.
The number of foreign features varies between five and this year’s seven but the expenditure of $185m is way down on a couple of recent spectacular years. The numbers vary horrendously, depending on the scale of production.
To this we can add the Post, Digital and Visual Effects (PDV) figures for the 21 overseas features are the highest in the last four years, climbing from $67m to $111m, while the TV figures for post are very low, at $3m.
However, the overseas TV shoot figures are spectacularly higher, as $112m arrives on four projects, with the previous modern high being a miserable $38m. That is just a number without a real trend, but the list of productions is instructive. Says Screen Australia:
.. the increase was driven by the second-highest spend on record for the four foreign titles shot in Australia – Reef Break, Preacher series 4, (US), If Time Flows Back (China) and Nirasha (Sri Lanka). The five PDV-only titles included Watchmen, The Fix, Why Women Kill, Messiah and For China, From China.
These are streaming titles, or subscription titles in competition with streaming, and reflect the intense competition at that level of the international market. That won’t end soon, though the Asian market will remain unstable for outside providers.
Total spend in the sector is $595m, a bit over the average of $568m. The number of co-productions remains very low – it rose to three this year which is an obvious area in which the sector could be improved.
If we take a longer run of figures on the international work we discover that the budgets add up to $2.351 billion over the last 10 years. The total for domestic production is $2.752 billion. This is a very simplistic comparison but it does remind us that the domestic sector might be the poor cousin, but it remains vital. This is why we fight to retain our protective regulations.
TV drama tends to rely on the number of slots so it is stable between 35 and 45 titles. This year we had 37, two under the average. But the expenditure was $334m, the highest in the last five years by around $20m. The number of hours is 441, slightly over the average, which means the total domestic TV drama is holding up.
The number of hours in series/serials remains very stable at 296 hours, which presumably depends on Home and Away and Neighbours. The number of hours of miniseries bounces between 109 and 162 with 144 last year. This is not a stable area.
But expenditure on miniseries seems to be stable at slightly more than $200m, with their per hour cost climbing slowly upwards to float around $1.5m/hour, as telemovies remain cheap at $1-2m.
The figures for telefeatures look grim. Over the five years they have gone nine, ten, five, five and one. If we had a substantial strand of telefeatures, the production landscape would look much better, as stories found their natural home.
In general, as Screen Australia emphasises, television budgets have risen by 7%.
Enter the streamers
However, the agency has now added video on demand to the mix, which enables us to see the impact of streaming. The production techniques and creativity are effectively television based, so the real amount of TV production work has increased by much more.
Says Screen Australia:
‘In 2018/19, 28 titles were made for first release online – two single episodes and and 26 series title with total budgets of $53m and Australian spend of $40m. There were significantly more online drama titles made this year compared to 2017/18. Overall budgets remained steady, but expenditure was down on 2017/18 due to some titles spending a significant amount overseas.’
The researchers have bundled the production figures together by kind of broadcaster, because they have different regulations and motivations.
The ABC had a burst of deals in 2016/17 with 34 titles, a commitment of $55m, creating 120 hours at a total budget of $130m. Other than that it hung out around 20 titles. But in this last year, it peaked at 28 shows, for license fees and investments of $52m, for 128 hours and a total budget of $157m. It is now getting around $30m more year from the rest of the system. Last year SBS and NITV set up four titles at budgets adding up to $16m with an investment of $5m to run 12 hours of original television.
The three commercial channels together are doing around 23 titles most years, for a combined license fee of a bit over $100m to deliver about 400 hours. Budgets tend to sit in the $200m slot. Nothing to report but little to show off about.
Subscription TV aka Foxtel, is sulking at the bottom of the list, having gone down in all numbers from a high in 2016/17. In its glory days it put $50m into seven shows translating into 58 hours and a total budget of $75m. Now it is down to three shows for $12m and 22 hours costing 33m. That may be to do with how Foxtel deals with its expenditure requirement, or maybe it just doesn’t think gumleaf production works for gumleaf people.
Costs for Australian and foreign online streaming services have varied a lot, topping at $30m and now at $19m; we can’t see a stable figure. It secured 23 hours for a total of $47m, so the per hour cost has been $2m for the last two years. Which could be a new norm.
Again, across state agencies and federal sources, the support has remained gamely in place, despite some financial horrors especially in South Australia and Western Australia. While that stability is useful, demand is no doubt climbing steady along with quality from both experienced and emerging creators.
So far, as Screen Australia’s Chief Operating Officer Michael Brealey said, ‘We have managed to absorb savings into our operational budget and keep money in production so it goes on screens. I think if there are additional cuts in the future, they will be difficult to absorb.’
The process ‘reflects our recoupment position as well. Recoupment is tricky for us too because it declines over time and then goes up a little bit.’
He also notes that the ABC has been able to sustain its commitment to drama and children’s even though it has been under such pressure. The forward estimate figures are still in place so we can see it fall further.
The difficulties are getting worse and the industry stability is coming under more attack. We are seeing more pressure on our bubble, and when it bursts, there will be a mess. The real problem is about change. The opportunities in ‘the golden age of television’ are still in the global sector, but we can’t bootstrap much to find them. The only real source of capital is the government.
The last time round, a lot of this was solved through the first years of the Enterprise Program, but that won’t happen again. This time round we are on our own.
Screen Australia has a podcast about the report which features Michael Brealey on the website.