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Australian film and TV industry economic contribution declines despite growth in online

The contribution the Australian film and television industry makes to the economy declined by $800m between 2009 and 2013 according to a new report.

The report, prepared by Deloitte Access Economics, shows the economic contribution has reduced from $6.6bn in financial year 2009-10 to $5.8bn in 2012-13, a decline of 12 per cent, with employment also 4.2 per cent lower at 46,632 full-time equivalent positions (FTE) over the same period.

‘Economic Contribution of the Film & Television Industry in Australia’ report

It claims the free-to-air TV sector makes the largest contribution to GDP, responsible for approximately $1.5b in value added which is consistent with the 2009-10 report, while the production sector was the greatest contributor to employment with 13,000 FTE employees. It also accounts for $996m of the total economic contribution of the industry.

However, while the contribution did fall, the film and television industry remains a significant contributor to the Australian economy compared to other industries.

The report puts the film and TV industry’s contribution to Australian GDP at $5.8b, well above internet service providers at $1.8bn.

Source: Economic Contribution of the Film & Television Industry in Australia report

Source: Economic Contribution of the Film & Television Industry in Australia report

Online nearly trebled in size over that period from $5m in 2009 to $13m in 2012-13 with the report suggesting the increase is most likely “driven by a shift in consumer preference to streaming content including purchasing filmed content.”

“The market is diversifying with the recent entry of Fetch TV and the emergency of subscription video on demand services such as Presto, Stan, Dendy Direct and shortly, Netflix,” the report read.

In the 2012-13 financial year 11 per cent, or $1.6b, of online retail spend was in the media sector which consists of movies, including TV, books and music.

Online movie spend can be difficult to determine due to revenue from film and TV purchases in, for example the iTunes store revenues end up offshore. The report used a breakdown provided by the Australian Communications and Media Authority to estimate the level of movie and TV spend through Australian-owned companies – with estimates covering only legal purchases of downloads.

The report estimated gross output through online movies to Australian-owned companies to be around $24.5m, which saw $13.1m of value added to the Australian economy.

While online grew, it contributed to the fall in the distribution sector as people turned to online sources or pay TV for content.

“There has been a number of innovations introduced including Foxtel Go, allowing users to stream content on a number of devices including set top boxes, mobiles and tablets,” the report read.

It outlined the emergence of SVOD players as contributing to a $300m increase in value added to the sector, as online purchase and rental of filmed content continues to grow as a sub-sector of the industry.

Looking at production, the sector saw its GDP contribution increase by 8.3 per cent between 2009 and 2014, with the report suggesting the increase could be explained by a a “greater share” of locally produced feature films and TV dramas since 2009.

“Domestic productions have grown from about $400m in 2010-11 to over $600m in 2012-13,” the report read.

Spend on Australian production of features and TV dramas peaked in 2008-09 at $701m and over this time spend through foreign owned produced in Australia was quite volatile with over $200m in 2007-08 before dropping to just $3m the following year.

Source: Economic Contribution of the Film & Television Industry in Australia report

Source: Economic Contribution of the Film & Television Industry in Australia report

Breaking down the contribution of the film and TV industry on a state-by-state basis puts New South Wales in front, contributing $3b to Australia’s GDP. NSW was followed by Victoria who accounted for almost $1.3b while Queensland ranked third contributing $833m.

The Northern Territory unsurprisingly accounted for the least contribution, responsible for $34m value added to the GDP.

The states contributed approximately $2b in taxes, with corporate tax and income tax from the industry accounting for $498m and $454m respectively. The GST paid by consumers was just over $1b Australia-wide, with $434m in GST paid in NSW and $228m paid in Victoria.

 

 

 

 

 

 

 

 

 

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