sa¹ú¼Ê´«Ã½’s film-production sector is bracing for a potential Hollywood writers’ strike as local industry players navigate what some say is a global production slowdown.
Recent good news has included that the second season of The Last of Us is set to be filmed in sa¹ú¼Ê´«Ã½ later this year. A third film in The Walt Disney Co.’s (NYSE:DIS) TRON franchise is also slated to be filmed in Vancouver, starting in August.
Higher interest rates on both sides of the border, however, have hiked financing costs for productions, while the recent banking-sector jitters may prompt banks to be more selective, and careful, when loaning capital.
The inflation-fuelled higher cost of living may also encourage consumers to cut back on spending, including on entertainment, which would trickle down into less revenue for studios.
Many eyes are on the Writers Guild of America (WGA) and the Alliance of Motion Picture and Television Producers, which are negotiating a new contract to replace one that expires May 1.
Unless a deal is reached, those Hollywood script writers could walk out, creating a ripple effect of reduced production across the world.
Sticking points in negotiations include regulating how artificial-intelligence-produced content can be used. Longstanding concerns, such as how high minimum pay rates should be, are also on the table.
“The [potential] writers’ strike is one of a few things that have contributed to the perfect storm that has led to a downturn in the market, not just here, but globally,” said Motion Picture Production Industry Association of sa¹ú¼Ê´«Ã½ (MPPIABC) chair Gemma Martini.
“The message that a lot of people in our industry have yet to acknowledge is that this is a global downturn that is happening.”
Being in what Martini told BIV is the "shadow” of a potential strike has made some production companies already shelve projects until there is more certainty.
Netflix Inc. (Nasdaq:NFLX) in late March said it was streamlining its film production, resulting in layoffs.
“Currently, we don’t have any productions in our stages,” she said of her own production company, Martini Film Studios.
“That’s the first time we’ve had this experience in the six years that we’ve been here. We’ve been full otherwise. Again, that’s just demonstrative of the downturn in the market.”
The 2007-08 WGA strike lasted 100 days, and local studio executives active at that time refer to the dispute as causing a “short-term” delay for projects.
Martini said it is anyone’s guess how long a strike this year could be, but she is confident that once the contract is settled, there will be a sharp upturn in activity.
She added that it is part of the nature of the industry to have periods of time with production lulls, followed by time when demand for studios is high.
When demand resumes, Vancouver’s film sector will be larger than ever because studios are building more space, she said.
Bridge Studios, for example, plans to build 42 new sound stages in Burnaby by the end of 2026. The construction will bring Bridge’s number of sound stages to 55.
Vancouver Film Studios opened a new stage and office building in 2022, while Mammoth Studios opened two new stages in the past three years.
Vancouver Film Commission’s commissioner Geoff Teoli similarly sees long-term growth for the local film sector.
“Some of these things are really out of our control, but the industry has been on a trajectory, and a trend, for many decades, upward,” he said.
The COVID-19 pandemic prompted a near-shutdown for part of 2020, but what followed was a record $4.8 billion spent on film, TV, visual effects and animation in sa¹ú¼Ê´«Ã½ in 2021, according to Vancouver Economic Commission (VEC) research.
VEC’s 2022 report on the state of the industry is not set to be released until late summer but Teoli said he believes spending last year in the industry was “consistent” with the amount spent in 2021.
“The anecdotal sense that we got last year from everybody in the sector, including union halls, is that people were busy, and people were working at capacity.”
Producers see Vancouver having advantages over other cities
Some of the key selling points that Vancouver has, Teoli said, include:
• a reputation for success as the third-largest film and TV production centre in North America;
• being in the same time zone as Hollywood;
• world-class talent in the wide range of jobs that film producers need;
• competitive tax-credit incentives; and
• supportive permitting from the region’s municipalities.
Increasingly, he added, Vancouver’s reputation for being at the forefront of sustainability attracts Hollywood production companies.
He was recently in Los Angeles, where he met production studio executives who told him that “they consider Vancouver to be the gold standard globally, when it comes to sustainability.”
Netflix has set a goal to cut greenhouse-gas emissions in half by 2030, and other studios have similarly amped up their carbon-emission targets.
Those pledges work to Vancouver’s advantage.
The city had its first clean-energy power kiosk in 2018, and has since added four more. Another three such kiosks are set to be unveiled on April 13.
Those kiosks mean that production companies can use cleaner electricity, instead of diesel power, Teoli explained.
Peter Leitch, who retired in September after decades as president of North Shore Studios and Mammoth Studios, said his experience tells him that it is best to consider threats of strikes, and actual strikes, as “a normal course of business.”
This was the case last year, when sa¹ú¼Ê´«Ã½ film and TV directors voted in favour of a strike mandate for the first time ever, after negotiations between the Directors Guild of sa¹ú¼Ê´«Ã½, sa¹ú¼Ê´«Ã½ District Council, the Canadian Media Producers Association and the Alliance of Motion Picture and Television Producers collapsed.
The parties later reached an agreement without a strike taking place.
“I didn’t anticipate a strike in that case,” Leitch told BIV. “If there was one, I think it would have been short lived, and it’s quickly forgotten once it settles.”•
