Is the UK Film industry growing?
At Films4U we keep a constant finger on the pulse of the UK film industry to ensure that we maintain our record of never losing money on a film. We share our in-depth knowledge of the industry so you can make an informed decision about whether investing in film is right for you.
The UK film industry today
In recent years, the UK has attempted to boost its film industry to contribute to the UK economy and culturally enrich the nation. Statistically, the UK film industry is three times as large as it was in 2012, generating a turnover of £14.8 billion in 2017. This exponential growth has greatly benefitted the affluence of the UK.
These figures demonstrate an astronomical increase in revenue, from a sector that many previously feared would be threatened by online piracy. In fact, you could even say that new online streaming mediums have enhanced the diversity and accessibility of movies today. This has resulted in a higher volume of movies being watched and a higher demand for production.
Perhaps as a result of this, investment in film in the UK is on the rise. In 2019 the UK spent a record £3.075 billion on inward investment and production. This highlights the upward trajectory the UK film industry has been on in recent times. To compete in a global market, the UK has to spend more money and time every year to maintain this incline.
In terms of budgets and box office ratings, British films are lacking compared to Hollywood blockbusters. Therefore, to contend with countries like America and China, the British film industry concentrates its money on the quality of its films, not the quantity. This means that the UK’s return on investment for a film is often much larger than their competitors.
Be warned, the industry could potentially see a plateau or even a deficit following the effects of coronavirus. With the UK reaching some of the highest cases in the world and enforcing lockdown, it has meant that companies have had to postpone filming. With release dates being pushed back and budgets being cut in this current economic climate, it could spell trouble for this sector.
How big is the UK film industry?
In 2019 the GDP of the UK was £2.21 trillion and 61 billion of that income was generated by the film industry. This is a remarkable portion of the UK’s wealth and demonstrates the magnitude of the film industry in our country.
The UK has not only produced the fourth highest-grossing movie of all time, Star Wars: The Force Awakens, but it is also rated fourth in the world for box office ratings. These statistics are extremely impressive considering the size of our country compared to its competitors. This has been made possible through the UK’s established history in film making and long lineage of established directors.
These factors have culminated to produce a large and growing industry that is known across the world. The only countries that surpass the UK in film revenue are China, Japan, and America.
Will Brexit affect the UK film industry growth?
Following the 2016 referendum, those in the film industry have been uncertain about what withdrawing from the EU means for them, economically and creatively. In terms of growth, this sector is underpinned by legislation made in conjunction with the European Union. Therefore, by gaining independence, the UK is set to lose freedom of movement for labourers and access to financing from other European countries.
The film industry relies heavily on the people they employ and the equipment involved in the movie to be able to move between locations. These locations are often in other European countries and without the relationship we have built over the last 47 years, this will prove more difficult and expensive. These impacts will inevitably depreciate the pound and result in less money to circulate back into the film industry.
However, Britain leaving the EU could potentially result in new international markets with other countries outside of the European bloc. This could mean funding from larger countries and allow for the UK to make decisions about the industry freely without the restriction of European Union legislation. In this way, Brexit could be positive for the growth and development of the film industry.
How streaming services have affected the UK film industry
Some might argue that the UK film industry has perhaps stagnated since the heights of the ’90s; producing movies like the Matrix and Fight Club, but it’s undeniable that technology has enabled the film industry to expand massively.
For example, digital filmmaking has meant that more low-cost films are being made and there has been an astonishing increase in producers in the last decade. Online platforms such as Netflix and Amazon Prime have also had a substantial impact on the production and distribution of films in the UK.
In recent times, online streaming has become a popular way to access films rather than at the cinema. We can see that modern entertainment technology has revolutionised the film industry, helping grow the number of views and genres they have to offer.
Global film industry trends
There is a wide variation in trends among different countries across the world. It seems that Europeans prefer drama and romance, whilst Italians enjoy comedies and Asians prefer action films. Of all the films created across the globe in the last twenty years, 51% are dramas, according to studies conducted in 2018.
This might be because drama is the cheapest genre to produce, as they are often set in real-life situations. It also has the broadest definition and does not have specific requirements for classification. For example, compare it to a horror or fantasy movie, which often uses extravagant costumes and lighting.
Coincidently, the horror film genre has grown significantly and is becoming somewhat of a trend. In 2000, horror movies accounted for a mere 4.3% of film categories, and this had since risen to 12.4%. This demonstrates the difference in generational preferences, as it has been proven that people age 18-24 watch more films than any other demographic.
Therefore, new genres are being watched by the youth of today and there is a constant demand for the UK Film industry to adapt to what is popular.
The information contained on this website should not be taken as financial advice or as a personal recommendation by Films4U. Before investing you should always seek appropriate legal and financial advice from an authorised person specialising in investments of this kind.