2009 French production stays at high level

In 2009, motion picture production activity remained at a high level, close to that of 2007. 230 features had CNC regulatory approval, 4.2% less than in 2008 (- 10 films). This slight decline only concerned French-initiated films (182 films in 2009, against 196 in 2008). On the other hand, the number of features funded by a majority of foreign monies increased slightly (+ 4 films). In 2009, French production counted 195 features, 30 documentaries and 5 animation films.
Changes in the number of films - Source CNC
Changes in the number of films
Source CNC

1.1 billion Euros in investments
After 2008, which was an atypical year with three films budgeted over 40 million Euros, the investment in features was down 26.3% in 2009, reaching 1.10 billion Euros, a level close to 2006 (1.15 billion Euros).
Investment in French-initiated films was down 26.3%, to 927.5 million Euros, while the number of films decreased by 7.1%. This trend reflects a decrease in the number of films with budgets over 10 million Euros, with a cumulative decrease of 320 million Euros, which accounts for 96.5% of the total decrease in investments in 2009.
All funding sources are declining. However, in this context, the weight of the CNC aid is increasing (9.9% of the financing of French-initiative films, against 7.6% in 2008), as is also that of the assistance from local communities (1.8% in 2008, 2% in 2009).

Decrease in investments from TV
The investment by TV stations in features decreased globally by 13.1%, to 315 million Euros. Pay TV investments were down by 6.5%, to 204 million Euros. The investment in non-pay channels showed a decline of 23.1% in 2009, to 111 million Euros.
One should however be cautious in analyzing these numbers, given the gap between the timing of the obligations of TV channels (annual financial commitments to the CSA) and that of the CNC (related to the approval of investments). The changes result in part from a compacting of the levels of contribution by certain TV channels.
Film financing approved by distribution mandates decreased by 56.7% to 150 million Euros in 2009. This decrease can be explained by the structure of film production (fewer films with budgets over 20 million Euros). The decrease mainly concerned foreign mandates, which lost 90% of their value compared to 2008. This development also reflects the difficult international economic climate since the end of 2008.

Record number of French-initiative first and second features
The number of first and second features increased, reaching respectively 77 films, and 37 films (compared to 74 films and 31 films in 2008). First and second features represent 62.6% of French-initiated films.

Less marked bipolarization
The year 2009 is marked by a reduction of the bipolarization of production budgets. The number of French-initiated films below 1 million Euros decreased (- 16 films), as did the number of films above 7 million Euros (- 14 films). The number of films with budgets between 1 and 7 million Euros increased (+ 12 movies).
In 2009 French-initiated films with budgets above 7 million Euros accounted for 62.7% of all investment (74.5% in 2008), while they represented 25.3% of the number of films shot. The tightening of production budgets is also illustrated by a decrease of 20.7% of the average budget of French-initiated films, to 5.10 million Euros in 2009.

Costs of French-initiated films
Every year the CNC does two distinct studies, one of the costs of production, and one of the costs of distribution of French-initiated films.

Distribution of funding - Source CNC
Distribution of funding
Source CNC

The cost of film production in 2009
175 films, 873,8 million Euros spent
This study is based on final production costs of films that received CNC approval, after filming was completed. In 2009, 175 French-initiated films (all genres) received CNC approval (5 more films than 2008), for a total expenditure of 874 million Euros (902 million of Euros in 2008). No film had a production cost exceeding 30 million Euros (versus 2 in 2008).
It should be noted that the scope of this study is different from the annual review of the films based on the year of investment approval (as opposed to production approval). There is an average of 18 months between the two approvals. Thus, only 4.3% of the films analyzed in this study on production costs had investment approval in 2009.

Fiction films spend : actor portion down
The average cost of a feature film that received a production approval in 2009 amounted to 5.73 million Euros, 0.2 million Euros less than 2008. Of the films that received production approval in 2009, the expenditure pattern is characterized by a higher share of expenditures devoted to wages (56.3% in 2009, 54.7% in 2008) and slightly less to production (30.4% in 2009, 31% in 2008) and to technical costs (13.3% in 2009, against 14.3% in 2008).
In 2009, the percentage of actor cost in features is reduced. At 11.4% of total costs, it reached its lowest level in the seven years studied (12.9% in 2008). This decrease is linked to a decrease in leading roles costs of 19.1%. They represented an average of 6.8% of the total cost of a film in 2009 (8% in 2008).

The relocalization effect of the cinema tax credit for fiction films
The cost structure of films receiving the tax credit and those who didn’t was analyzed using a sample of films that was slightly different from the rest of the study. This analysis confirmed the localizing effect of the cinema tax credit. Indeed, in 2009, projects benefiting from the film tax credit carried 4.5% of their expenses abroad, against 42.7% with the films without the credit. This tendency is also confirmed in the analysis of line item expenditures of the films with the tax credit : over 90% of costs on items most commonly delocalized were spent in France. In 2009, the final total of the tax credit amounts to 37.20 million Euros.

The cost of distribution of French films in 2008
The study covers a sample of 844 French-initiated films released in theaters between 2004 and 2008. The average cost of distributing a feature film stood at 689.4 K Euros in 2008. It is stable compared to that of films distributed in 2007.

Increasing share of laboratory costs
The share of laboratory costs increased in 2008 (32.6% against 31.3% in 2007), especially for films with a release exceeding 50 prints. The top item of expenditure remains the purchase of advertising (billboards, cinema, internet, press, radio, television). This represented 43.2% of total distribution costs in 2008 (45.3% in 2007).

Distribution cost structure correlated with number of prints
The distribution cost structure of French-initiated films depends on the number of prints. Thus, below 100 prints, technical and promotional expenses (lab fee + other expenses) account for over half the cost of distribution (56.3% in 2008). This proportion increases as the number of copies decreases.

Source : CNC
These studies are available in full on www.cnc.fr

(Translated from French by Benjamin B)