Entertainment growth factor: Money

Changes in film financing are occurring around the world. In the U.S., private equity is beginning to invest in films. These funds spread risk by investing relatively small amounts in a large number of films. The combined effect of multiple funds will be to make substantial monies available for large-budget productions. It is a boon to studios because such funding lessens their need to pre-sell rights or to enter into co-production arrangements, increasing their share of potential back-end revenue.

In other regions, governments are increasing their support for the production of filmed entertainment. In EMEA, the German government is planning new film financing incentive programs to replace discontinued tax-sheltered film funds. In Ireland, the government offers tax relief, amounting to as much as 80% of the budget. Sweden raised its subsidies to local filmmakers to $40 million annually. Spain, Hungary, and Poland also support the production of local films.

Asia Pacific countries such as South Korea, Taiwan, India, and China all introduced programs to encourage local filmmaking. In Latin America, Mexico, Argentina, and Brazil have similar incentives. In addition, Brazil provides special funding for the construction of new theaters.

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Hollywood Reporter