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Movie & Video Making: Comprehensive Market Analysis

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Global Movie & Video Production Industry

The global motion picture production and distribution industry generates $120 billion annually, according to estimates from the Motion Picture Association of America and PricewaterhouseCoopers. The global filmmaking industry is dominated by business centers located in the US, India, Hong Kong and Nigeria. Within the EU, France and the UK dominate in terms of movie production. Infrastructure and labor costs can dictate where films are produced, with many films paid for in one country and produced in another.

The global movie and video production industry also encompasses businesses preparing motion pictures for public distribution. Outfits that work in movie or television production and carry out in-house post-production processes do not fall into this industry category.

Apart from influencing public opinion regarding current events and social issues, the film and video production industry also has an impact on consumer purchasing decisions. The industry’s value is almost impossible to estimate due to the difficulty in calculating movie studio production costs.

The worldwide movie and video production industry is fuelled by consumer spending. Whether any one company will prove lucrative is dictated by factors such as distribution, marketing and creativity. Larger outfits can become well established by securing long-term contracts with directors and actors. Other size-related advantages include access to wide, well-established distribution networks and skilled technical staff. Smaller companies tend to focus on creating specialty movies for specific audiences at a lower cost.

Regional Market Share

In the US alone there are around 11,000 companies operating in the motion picture production and distribution industry, generating around $60 billion a year. The market is characterized by concentration, with the top 50 companies holding around 80% of the market’s overall revenue. Leading companies currently operating in the US motion picture production and distribution industry include Universal, FOX, Paramount, Warner Bros, Sony Pictures, Disney and MGM.

In general, companies tend to be involved in motion picture production and distribution, with around 500 outfits serving as distributors only. The EU, Africa and the Middle East account for around 50% of the market’s overall value in terms of international box office takings, followed by Asia-Pacific, which generates around 20%. Outside of the US, leading players include Spanish outfit Promotora de Informaciones, Egmont International Holding of Denmark, and Japanese company Toho.

The US film and television production industry has an effect on other industries, including tourism. A New York State Comptroller report highlights the aggressive tactics of some US and Canadian states in competing for film and television production employment through tax incentives. California has the largest share of the industry in the US, followed by New York. California’s film and television production industry also employs more people than any other state, and the highest number of movies and television shows are also filmed in the state.

India’s entertainment market is recording strong growth, partly due to global production houses entering the market. Over 1,000 films are released each year in India, with more than 3 billion tickets sold. Growth is particularly strong in the home video and box office market segments. New film distribution models, a rising number of animation films and emerging financing models are some of the trends being witnessed in the Indian entertainment industry at present. The country’s Bollywood film industry is also recording very strong growth, with international hits such as Slumdog Millionaire and Peepli Live, with the latter nominated for the 2010 Sundance Film festival. Bollywood movies are designed to capture both domestic and international audiences so that spectators from different cultures can relate to the films. Bollywood also uses product placement of Western goods to appeal to a younger Indian demographic sensitive to Western culture.

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