Canuck helmers defending turf
Guild calls biz study figures exaggerated
Faced with a Hollywood industry study on runaway production that says Canada is snatching about 80% of all U.S. productions shot abroad, Canadians are putting up their dukes in defense -- and throwing a few jabs of their own.
The Directors Guild of Canada on Friday implicitly criticized its sister union, the Directors Guild of America, over findings in the study, commissioned by the DGA and the Screen Actors Guild and released on June 25.
The study, conducted by Santa Monica-based researchers for the Monitor Co., asserts that the U.S. entertainment industry lost $2.8 billion last year in direct production expenditures of shoots that went abroad, with Canada taking the lion's share -- about $2.27 billion.
Reliability questioned
Not so, the Canadian directors say. The Monitor report is "unreliable" and "grossly exaggerated" in its estimates, according to a DGC statement issued in Toronto.
"What we all need is a reality check," DGC president Allan King said. "When you actually look at the audited numbers, it turns out that the U.S. study has exaggerated the amount of U.S. production dollars coming to Canada by a factor of three to four."
The DGC said it had conducted a "preliminary review" of the Monitor study with the assistance of PricewaterhouseCoopers. The actual amount spent on foreign location shooting in Canada in 1998 was just $573 million in U.S. funds, King said.
"That represents a real increase in Canadian activity over the last few years," King acknowledged. "However, it is only a quarter of what the U.S. study estimated was being spent in Canada on so-called runaway productions."
It is clear, the Canadian directors' statement said, "that the DGA/SAG study has to be taken with a grain of salt."
Entertainment international
Their broadside came on the heels of declarations by former Prime Minister Kim Campbell and other Canadian officials to the effect that filmmakers are not beholden to Hollywood and that entertainment is an international industry in which the search for bottom-line advantages makes good business sense (Daily Variety, July 9).
In a brief response to the Canadian directors' press release, the DGA and SAG said in a joint statement that they "stand firmly behind both the methodology and findings of the Monitor Co., an internationally respected and fully independent consulting firm."
Mark Lubkeman, one of the Monitor consultants, said Friday that it was not clear from the Canadian directors' statement "which productions are in their sample."
Questioning sources
He also disputed the DGC assertion that the American study relied on production numbers published in trade papers "and other secondary sources," which the Canadians dismissed as often "wildly out of line with reality."
In fact, Lubkeman said, the Monitor researchers also plumbed the Internet Movie Database, the Baseline service and SAG and DGA figures; they also conducted numerous interviews with producers and studio execs.
"The study methodology is robust," Lubkeman said. "We had a very large sample."
He added that the Canadians seem to be interpreting the Monitor study as focusing exclusively on U.S. productions going to Canada.
"In reality, the issue is that productions that could have shot in the United States are choosing for economic reasons to shoot abroad -- not just in Canada," he said. Other countries reaping the benefits are Australia, New Zealand and Ireland.
Fleeing H'wood
In 1998, out of 1,075 film and television productions developed in the U.S., 285 went abroad for economic reasons, a 185% increase over the 100 such economic runaway productions in 1990, the Monitor report declared. (The report makes a distinction between productions that left the U.S. because it was cheaper to film elsewhere and those that went abroad because the story called for a particular location -- the so-called creative runaways).
"The Canadian government has engaged in a comprehensive and aggressive, long-term strategic campaign to attract U.S. producers," said a joint DGA/SAG statement issued alongside the Monitor report. As a result, the guilds said, "Canada has captured the vast majority of economic runaways."
Jack De Govia, an art director who heads the Film & Television Action Committee -- formed specifically to rein in runaway production -- put it more bluntly.
"It's a hijacking," he said. "Canada is buying the American film and television industry with outrageous rebates of 35% or more. We want California to start fighting back."
The statement from the Canadian directors tried to be conciliatory, even as it deflected the blows.
"The real numbers show that Canada is not a problem," it said. "Film and television is a collaborative art, and as film and television industries mature in countries around the world, you can expect to see more collaboration take place across borders. These projects are not 'runaway' productions; they are 'international' productions, and they reflect the simple fact that they are financed and sold around the world."
