Shortage of staying power

Primedia and AME prove that corporate giants and the South African film industry are not perfect casting Andrew Worsdale Joseph Losey (director of The Go- Between, The Servant and many other fine movies) once said, “I am frequently told that my films don’t make money. Since I have averaged one film a year for 30 years – some of them expensive ones – I can only conclude that somebody is making money.” Well isn’t it funny that films never seem to make money when everyone in the racket obviously seems to make a packet? Or wants to quickly. The problem of corporate and conglomerate moguls trying to muscle in on the movie industry has been a constant factor in the business of show business for many years. Every time one picks up a trade magazine like Hollywood Reporter, Variety or Screen International there’s some new honcho sitting at the head of one of the top studios – it’s become almost a weekly occurrence, this game of studio musical chairs. With Rupert Murdoch controlling Twentieth Century Fox, Ted Turner buying the entire library of MGM and studios like Paramount, Columbia-Tri-Star, Warner Bros and Universal cross-collateralising business through telecommunications, television, multi- media and the Internet, the movie business is no longer simply a matter of your neighbourhood cinema. South African entrepreneurs copied the trend a few years ago with Primedia and African Media Entertainment (AME) listing on the stock-exchange and waxing lyrical about the future of media, the film industry and the Internet. At the time most people in the movie industry were upbeat about the future of local film product, what with the Department of Arts, Culture, Science and Technology (Dacst) supporting new initiatives and the clout of these major listed players. But this year the dream has shattered. Media humpty-dumpties have had a great fall, and both Primedia and AME are in tatters. Primedia has closed down its film division and AME is going through major restructuring. Two weeks ago AME announced the sale of some non-core assets, including Afrikaans radio station Punt Geselsradio. This came after it reported a 135% fall in headline earnings. A depressing reality for a media conglomerate that had a share price of 188c in May 1998 and were trading at 5c this week.

The Financial Mail commented that the crisis for both companies is that they took on “a zoo of business without focus or leadership”. Roberta Durrant, head of Penguin Films -which at one point was affiliated to AME (with an R8-million price-tag) – concurs. “The synergy didn’t work. There wasn’t strong enough management or vision at the top. However, with this restructuring I believe AME is well on its way to consolidating its future,” she says. Durrant is one of AME’s most successful partners, with her company Penguin Films having secured five sitcoms for e.tv. Says deputy chair David Dison: “We launched AME as a platform for makers of entertainment and cultural content across all media and despite all the cynics nothing has actually gone wrong apart from market perception.” AME produced more movies than Primedia – including two local films, A Reasonable Man and Inside Out, as well as the Zimbabwean-based pot- boiler High Explosive. The company also serviced the international movies I Dreamed of Africa, Kin and Hoofbeats through its production arm Moonlighting. A Reasonable Man cost R10-million and Inside Out, R3-million, but both films failed to earn more than R100 000 on the local market. “They didn’t fare badly in the rest of the world,” Dison says. “Reasonable Man is heading towards a global profit. Inside Out didn’t have a sufficient budget. You cannot make films for theatrical release only in South Africa.” Peter Matlare, chief operating officer at Primedia, says: “Part of the reason why we’ve stumbled is that the expected ‘take-off’ in the South African film industry has not materialised. Equally important, the television industry took longer to get off the ground than expected.” Jeremy Nathan, independent film producer who was head of Primedia’s Film Production outfit, has interesting things to say about moving between the independent sector and conglomerate filmmaking. “The main difference between running an independent film company and a large one,” Nathan says, “is that being part of a corporation implies accountability.”

Referring to Catalyst Films, his previous, independent company, he says: “I was the sole shareholder and therefore only responsible to myself. At Primedia one had a board and, ultimately, shareholders. Both companies had the same goal, that of making international fare of the highest quality, and of making a profit. With a larger entity your overheads are bigger, and thus it is more difficult to return a profit in what is essentially a parochial and very small, and small-minded industry. “At Catalyst I managed to produce two feature films, seven documentaries and nine short films over a two-year period. At Primedia we managed one feature film, three shorts, and two documentaries over the same period.” Nathan complains that most South African media companies have a very narrow understanding of the business. “Large corporations have dabbled – they want to be like AOL/Time-Warner but the industry is too small here. In fact, the key players do not have a love for the business – it is just another profit centre. “When Primedia and AME got into entertainment their share prices were high. Primedia’s was at about R48 a share. It is now at about R5 or R6. All media companies took a bad beating in late 1998, and for most of last year. “I believe our industry, if one can call it that, is at its lowest ebb since I can remember. The broadcasters are a joke. And unfortunately they are the key: e.tv has not delivered on its promises; the SABC is in shambles; and M-Net do not really do any meaningful local content – they sell decoders,” says Nathan. “The government, although full of promises, has not managed to contribute anything meaningful. The joke in the industry is that Dacst, through its spending of R10-million a year, has created a film industry dole system. Just enough money to keep a lot of people quiet. Iceland, a country of 250E000 people, makes more films than we do. Their government contributes more than ours. An indictment, and not only for South Africa, but for Africa in general.” With all this malaise and a beleaguered local industry – despite the fact that Cape Town shoots loads of international commercials – the announcement a few weeks ago of New African Media Films, a wholly owned subsidiary of New Africa Investments Ltd (Nail), brings yet another corporation into the development of movies and TV. Heading the operation is Amy Moore, formerly head of co-production at Peakviewing – the most prolific producer of South African films – although they’re mostly set in the United States or Britain. The company will function in production and distribution, keeping its overheads lean. Veteran producer Paul Raleigh will be in charge of production and Stephen Francis (of Madam & Eve fame) and satirist Gus Silber will head up the creative team. They are looking towards making movies in the R10-million to R15-million range as well as experimenting with lower budget films on digital. Moore says: “We’re in the process of creating a slate, of pulling together resources in South Africa. We’ve got some hugely entertaining projects along the lines of the early US indie days … I imagine we’ll be ready to shoot in February 2001.” The problem is the money men’s need for a quick profit rather than building a content creation business. Good movies and a good media track record take a long time to make, and unfortunately, yet again, the South African film industry is a classic case of premature ejaculation. We have the passion, even the hard-on, but do we have the staying power?

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Mmanaledi Mataboge
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