Norm Bolen - Part 2: Small Producers
Interviewed by Fil Fraser at Banff World Media Festival on June, 2011
Fraser. Small independent producers must almost be an endangered species. There seem to be fewer and fewer buyers for the product.
Bolen. We are definitely seeing trends to consolidation in the production sector. There are already companies entering into production partnerships that result in shared offices and administrative resources. Some companies ultimately merge and consolidate. That's a natural reaction to what you're talking about: the vertical integration of buyers. It is increasingly difficult for smaller players to survive on one project every two or three years. It used to be a boutique business, or a hobby, for some producers. They would have one or two pet projects and work on them over several years. They lived very close to the bone; clearly they weren't making a lot of money doing that.
Now, it is almost impossible to make a living like that. It's not just a matter of fewer buyers. The buyers are also less likely to take risks. When I launched History and we were doing Showcase as new channels, we would put out a call to the marketplace and get lots of innovative ideas from people who were just entering the business. They were newcomers. We took chances. But now we don't have many new services launching, at least not those that are commissioning programming. The services are maturing; they've had a long history with certain producers and tend to go back to the producers with whom they've established a good working relationship. It's harder for the smaller person to get their idea in the door for approval, much less produce it, and deal with all the administrative and contractual obligations.
F. Does the technology that's available to smaller producers move that cap a little?
B. The younger people who are interested in film see the world differently. They look on the big budgets, complex technology, crowds of people working on productions in different roles, unionized production.... as luxurious and unnecessarily complicated. My son, for example, is studying film. Lots of people his age are just out there making films. They'll buy a DSLR camera for a couple thousand dollars, some used lenses at pawnshops, and some adapters. They'll jerry-rig audio systems, use handheld rigs, and they'll shoot incredible work that has a chance in the marketplace. They'll get a channel on YouTube. They'll do deals with Google or find other channels. They start their own distribution networks. They use crowd-sourcing for financing.
I talked to a young filmmaker yesterday. He's doing post-production on a film with some production values. I asked him, “What was the budget?” He said, “Cash… $15,000.” On a normal production, $15,000 probably pays for the stills photographer for promotions, or for lunch! There are innovators out there, young filmmakers who work closer to the ground. Of course, they will mature into filmmakers working in the system. But I think costs will come down and the complications will be reduced.
F. Is there room for them in the CMPA?
B. Of course. Part of our strategy for the next couple of years is to expand our membership beyond the traditional players and into the digital universe. We are finalizing an ambitious strategy to bring them in that has some benefit for them. We offer a discount for first-works producers to make it very affordable; they can join the organization without spending much money. And we embrace them. We find we're getting a lot more people interested in what we do.
The other trend that is important is what the Canadian Media Fund has been doing. A couple of years ago, Minister Moore presented a mandate to the CMF from Heritage Canada saying, “You must focus more on digital content and convergent content.” It was a shotgun marriage saying, “If digital and traditional producers must work together more, they’ll have access to certain portions of the funding. If they don't, they won't have access to certain portions of the funding.”
At first, that was challenging for everybody, because it was a radically new idea. People thought the sky was falling. But we adapted. We have stumbled our way through it and are seeing some results: a lot of innovation and partnerships. We have had funding issues about how to make that work. But we are resolving some of those, too. And the broadcasters are starting to embrace the idea. So it is really exciting to see that we’re evolving. We can't just keep on doing things as we've always done. That is not my view, nor that of my organization. We have to change the way we do business.
F. On the one hand, you have the established players that are getting bigger and bigger; on the other end, smaller players who are being innovative.
B. It makes for healthy debate and a lot of cross-fertilization. There is also conflict and potential danger, let's be honest. One of my absolute goals is to keep unity in the Producers Association; we must treat each other with respect. One of the advantages we have is that we don't depend solely on membership fees; we get 80% of our revenues from production check-offs, because we negotiate and administer all the collective agreements on behalf of the producers. A small percentage of the labour cost of those productions accrues to us. This provides us with a core budget, although we do get some of our money from our membership. One of the challenges is that most of the money we get from production comes from a relatively small number of producers. Every production company in the organization has the same vote; but 80% of the revenue comes from 15-20% of the membership. But those bigger players in the industry understand it’s in their own self-interest to ensure that younger players, the newer players, are brought into the system. They know that they cannot grow or sustain their businesses without an injection of new talent.
If anything, it is getting increasingly difficult to find younger people to bring in. It’s a very competitive environment. I was talking to a young consultant yesterday who works in digital; one of the things he does is help digital companies find employees. The digital industry is much bigger than film and television; it isn't just the gaming industry, but corporations. Everything is being transformed into digital. And every organization needs someone who understands social media. Kids coming out of school who have these skill sets are in great demand. Only a small percentage of them come into our industry. They see more interesting opportunities in the more innovative and modern industries with different business models.
So, we have to support those younger people in what they're doing and bring them into the industry or we are just going to dry up. We can't self-perpetuate without new blood. Look at this conference we’re at; the number of young people has grown exponentially because we have merged television and film with new media. I always say new media, but I never know what to call it. It isn't new. It's online, digital media, but it is transmedia. It is hard to come up with the right term. It is morphing all the time. Banff is a good reflection of the state of change in the industry. There are a lot of young people here with different skill sets than we used to see. There’s a more casual approach to the whole conference in recognition of the younger mix of people. A lot of the conversations are quite different than they used to be. They're all about how we work together and adapt to this new environment and how we change the regulatory environment. Very interesting.