Examination of Witnesses (Questions 1118-1184)
Ms Amanda Nevill and Mr Eric Fellner
17 JUNE 2009
Q1118 Chairman: Good morning, thank
you very much for coming. I am not sure whether you were not both
here for the previous session and have a rough idea where we are
coming from. What we are really trying to do is look at the film
industry to see what its progress is and what contribution it
is making, both economically and culturally, and see what else
could be done because we obviously make our proposals to government
as opposed to the film industry itself. Could you start by telling
me something about the role and remit of the British Film Institute?
We are in discussion with Ofcom in context with
its own review of Public Service Broadcasting. Additionally, in
our response to the Digital Britain interim report we asked
that the BFI is included in discussions from the earliest possible
stages to ensure that provisions are made for archiving Britain's
TV heritage in a post-analogue world.
Ms Nevill: Thank you very much for allowing
us this opportunity to give evidence. Obviously you are taking
masses of evidence from the industry and one of the jobs that
Eric has is the Deputy Chairman of the BFI and a Director of Working
Title, so he has very much a foot in both camps. Our job is to
really try and amplify the voice for the importance of film as
a cultural entity in this country. The BFI has been around for
over 75 years, we are a royal chartered organisation and we are
the national cultural agency for film in much the same way that
the National Gallery is for paintings. If I was stuck in a lift
and I was trying to explain to people what the BFI does, on a
day to day basis what we do is we champion the diversity of film
across the UK, so in other words we are on a mission to try and
ensure that as many people as possible across the UK can have
access to the broadest possible spectrum of film. Obviously what
that means is we need to source those films, bring the films in
and then tell stories about that film so we can get to the broadest
audiences that we can.
Q1119 Chairman: Thank you very much.
Your relationship with the UK Film Council is what exactly?
Ms Nevill: They are our funding body, so our
grant in aid funding comes through the Film Council.
Q1120 Chairman: And your annual budget
is what?
Ms Nevill: The grant in aid from the Film Council
is £16 million, our turnover is somewhere between £32
million and £34 million a year dependent on how that year
goes, so grant in aid is about 42 % this year. We are quite a
dynamic organisation and we took the liberty of giving you a sort
of dashboard of the BFI's performance over the last five years
and we have managed to really grow quite a lot of our businesses.
Bear in mind that we only grow businesses that do not succeed
within the market itself so we do not stray into what the market
can already deliver. Our monies come from obviously sponsorship
and fund-raising and also partnerships that we do. We have had
some really great partnerships with people like Palgrave Macmillanwe
now do our publishing with Palgrave Macmillan because they could
put in investment that we could not put in, but we have also had
a really great entrepreneurial new partnership with Gracemates;
those are the people who provide all the background data information
that you need, for example, when you are downloading from iTunes
onto your iPod. We are now providing them with the data that you
will need when you download videos. We have had big expenditure
of money upfront and then we will hopefully, cross fingers, start
to see royalties coming through. We then have businesses, so things
like DVDs, the Imax BFI Southbank, the London Film Festival and
RB2B, so film sales that we can make from the archive.
Q1121 Chairman: Do you get a levy
from the commercial public service broadcasters or not?
Ms Nevill: I do not think it is technically
a levy but you are quite correct, we get just under £1 million
in total which comes to us through Ofcom because we fulfil the
chartered obligations to maintain a national archive which is
discrete and different to a commercial archive for ITV, Channel
4 and Channel 5.
Q1122 Baroness McIntosh of Hudnall:
Can we explore a bit this notion of film as culture and film as
part of the wider cultural landscape? You make some quite strong
claims for the importance of film; you say, for example, that
"Most of the information we need to navigate modern life
comes through the moving image. To be literate in today's society
means to understand the language of film and television, to be
able to `read' and `write' in a medium other than print."
You go on to say that "Watching a film is an entirely differentand
far more immediateexperience than looking at a photograph
or reading a book", and I could give other quotes. I might
not altogether agree with you on the strength of some of the claims
you make, but clearly you have a view of film as a medium for
understanding ourselves, shall we say, that suggests that it should
be higher up the cultural agenda than it currently is. Would that
be fair?
Ms Nevill: That is exactly it. Just to be really
clear, we are not arguing for one minute, as you say, that it
is more important than any of the other forms of communicationbooks,
literature and writing are absolutely essential.
Q1123 Baroness McIntosh of Hudnall:
Not least, it might be said, because they are often the source
of film material.
Ms Nevill: They are, absolutely, and vice versa.
Our argument is that film is always seen as the poor cousin within
the cultural arena and as a societyit is very difficult
to prove this in concrete termswe under-estimate the power
that film has for good. Anthony Minghella used to say that when
you saw a film you actually borrowed somebody else's eyes for
two hours, and we also know that young people with things like
YouTube and this massive social network in terms of informal educationso
much of the information they get and the way in which they communicate
comes through the moving image. I suppose our mission is to say
that we should not overlook film, it is a really powerful tool
that we could make more of.
Q1124 Baroness McIntosh of Hudnall:
I am sure nobody would disagree with you about that; however,
can you give us some indication, firstly, of what more you think
needs to be done to try and make explicit the power of filmand
we should not forget television since your responsibility includes
television as a tool of communicationand particularly what
are you able to do yourselves and through the Film Council to
influence the kind of cultural impact that film and television
has?
Ms Nevill: The first thing I should say is that
there is a laziness if you like within the BFI in that when we
say "film" it is our short form for film and television
and in fact the moving image in its broadest spectrum. The question
you have asked is quite a complex one because it is quite difficult
to provide real concrete empirical evidence for where the impact
goes, but what I can do is I can give you some examples of the
alacrity with which the British public takes up certain things
that we have done. An interesting example might be Mitchell and
Kenyon. Mitchell and Kenyon were film makers at the turn of the
last century and they made what at the time were seen to be very
low level entertainment. What they would do is they would go out
and they would film ordinary people doing ordinary things, so
they filmed people leaving factories in Blackburn at the end of
a working day or they would go to a leisure park or they filmed
the first football match. Then in the evening what they would
do is they would project these films in a tent and they would
have audiences of 1,000 or 2,000 people a night because at the
turn of the last century people just wanted to see what they themselves
looked like on film. These films were considered absolutely culturally
irrelevant, they vanished for many, many years but then were rediscovered
in a milk churnvery dangerous, 800 nitrate films packed
into a milk churn in a basement in the north of England. The identification
and restoration of the films cost £4-£5 million and
if it had not been for things like the partnerships that we had
with Sheffield University none of that material would make any
sense if you saw it. We then used digital technology to put it
into the right speed so it could play, so it did not look like
fast silent film, and there was a co-production with the BBC.
The audience figures that were achieved for those pictures of
early British life completely took all of us by surprise. In the
beginning we could not get the BBC to take it, and in the end
we said "Have it for free; we have done this and we know
people would like it." The audience figures that we got on
three consecutive Friday evenings were in excess of Little
Britain and Big Brother. This was early silent film
but what people loved was the fact that they were looking at what
their grandparents were like, it gave a completely extraordinary
window onto where we have come from and where our roots are. That
is just one tiny example.
Baroness McIntosh of Hudnall: They were wonderful
films
Q1125 Chairman: Did the BBC then
pay for you it in retrospect?
Ms Nevill: Not in retrospect but we did keep
the DVD rights to it and it became one of our most successful
DVDs. Then of course we went on after that to have this great
relationship with the BBC and with the Discovery Channel and we
are by and large doing one co-broadcast a year.
Q1126 Chairman: Could we bring in
Mr Fellner because you are co-chairman of Working Title, Britain's
foremost production company. You have done Four Weddings and
a Funeral, Notting Hill, Bridget Jones' Diary and other films;
what is the value of the Institute for you as a working producer?
Mr Fellner: I see it from the view of practitioners
who I work with in the industry and I see how they came into the
industry in the first place and how they were exposed to film.
You have all had an incredible crash course into the film industry
over the last few months from the minutes that I have been reading
and you probably know a lot more about the industry than I doit
is amazing the people you have had speakingbut you will
see that it is critical that new blood comes into this industry.
We can never compete with America and the idea that we should
try to compete is a non-starterwe are a smaller country
and we should do our best to have the best possible industry we
can, but we cannot compete with them. The only way in which we
can create an industry is through our talent and we have amazing
talent: we have incredible writers, incredible directors and first
and foremost actors. Their exposure to film comes in two ways;
one they go to their local multiplex as a young child and they
see whatever the film is that first turns them on to wanting to
make movies or they have a cultural exposure to it. The BFI's
main job is to try and expose people to the history and the culture
of film; whether it is as important as we maybe like to think
is for opinions to shape but ultimately it is an essential piece
of the fabric of the industry, to bring on that talent, to teach
them where they come from, to teach them about film, to give them
exposure to earlier film makers and practices. The Mitchell and
Kenyon thing is fascinating because it goes way beyond film, it
goes into historical representation of what our country was like.
That is unique, no other medium could present that; we could have
books explaining it, we could have early photographs showing still
images, we could have paintings, but to have a moving image record
of how we lived our lives here in Britain is absolutely unique.
The wonderful thing about the BFI is it has this archive which
is the largestAmanda will correct me, I do not have all
the facts at my fingertipsarchive in the world and it is
predominantly hidden. Although it is the BFI's job to maintain
it, look after it and restore it, at the moment it is very difficult
for us to share it with the greater public, and Mitchell and Kenyon
was just one small piece of that. Imagine if the resources and
the will, both political and financial, were there to be able
to get that library into a digitised form and expose it to an
enormous audience, it would resonate even greater and the talent
pool would then grow beyond that. Amanda was talking to me earlier
about should one teach maths if maths is not going to become a
subject of choice in the real world? Of course one should because
it is integral in one's education. It is the same thing with cinema
in that we just do not know how much of an impact it is having,
but I have a teenager and young children and see that, sadly,
I cannot get them to read as many books as I would like to, but
they will watch moving images all day long. If we can somehow
define what that moving image is and change what they are watching,
we can somehow maybe change the world in which they live.
Q1127 Chairman: Having read your
submission it seemed to me a bit that you were looking backwards
but actually in fact, although that is obviously one part of what
you are doing, you are looking backwards because out of that material
you are going to encourage and help and bring on the talent of
the future.
Mr Fellner: Absolutely. Every society has a
responsibility to its cultural fabric. I am a commercial practitioner
so I straddle the two extremesI am an absolute commercial
practitioner as a film maker and then I enjoy my limited work
with the BFI at the other extreme as a cultural supporter and
champion. I am not an independent in the middle. Sorry, I have
completely lost track of what I was saying.
Lord Maxton: That is our job, not yours.
Chairman: You will not be lost amongst this
lot! Lady McIntosh.
Q1128 Baroness McIntosh of Hudnall:
Can I just take you back to what you said about your children
and link it to what you said about the dominance of the American
market, because clearly there is an enormous deal more material
out there than is UK-originated and located with the BFI. That
comes from other sources but is available to your children just
as much as it is to anyone else and they can consume an enormous
amount of that. As I understand it you are saying that what you
want to do is to try to encourage people perhaps as it were not
to consume quite as much of that but to consume a bit more that
will tell them about their own heritage, their own cultural roots
and will propel them towards becoming cultural practitioners of
some kind in this country that will make them distinctive from
the American influences.
Mr Fellner: I do not think so; if I put it out
like that I maybe was misleading you.
Q1129 Baroness McIntosh of Hudnall:
No, I am trying to mislead you.
Mr Fellner: First of all the archive is not
just British, it is world cinema, so we are not banging a British
drum only, we are banging a film culture drum.
Ms Nevill: We bring international cinema, world
cinema, to this country and that is a really important part of
our role. That is part of both contextualising the Britishness
but it is also part of injecting all those world cultures. As
an example, at this moment we are just about to release the recent
film by Abbas Kiarostaminot that it would be picked up
by anybody else because it is not going to make that much money.
He is a really important eastern film maker.
Q1130 Baroness McIntosh of Hudnall:
He was not allowed to come here.
Ms Nevill: He was not allowed to come here.
Take Kurosawa. Nowadays we have all heard of the Seven Samurai;
actually without the BFI you would not because we are the people
who, on your behalfwe are publicly funded and we get up
in the morning to do things for the publicbring films like
that in and build the market for them. One extraordinary and really
concrete example of how this can help the economyI do not
know if you have taken evidence from Thomas Hogue who looks after
a company called LOVEFiLM. It is a fantastic phenomenon that has
grown up in recent yearsthey are the company where you
can actually go online, you can book your DVDs, they arrive by
post and you watch them and then you send them back. It is very
useful for us because they obviously carry BFI DVDs as well. They
have a very, very sophisticated online customer data tracking
scenario and I was introduced to it about four years ago. He was
showing off and he said "I can press this button and I can
tell you who are the most important film directors being talked
about and being researched at the moment." I said, "Go
on, press the button." He pressed the button and at the top
was Fellini and the second was Hitchcock. For Fellini to be the
top I knew was simply because the BFI had done a two-month season
of Fellini down at the Southbank, so that starts to build that
whole economy; that was directly driving his rental business and
those DVDs coming in. He himself said Hitchcock would have always
been number one under normal circumstances.
Chairman: I want to bring in Lady Eccles and
then I will bring in Lord Maxton.
Q1131 Baroness Eccles of Moulton:
I just want to go back to the link which you very clearly described
to us of the Institute at one end and being part of the commercial
industry at the other end. What contact is there, apart from yourself,
between the two? Is there quite a lot of contact between the Institute
and the commercial industry?
Mr Fellner: There is; I would like to see more.
There is a plan for the ultimate more to happen and that is for
the BFI to have its own proper building on the South Bank, which
is probably a separate conversation. That would create a focus
for the industry like all the other artistic industry elements
have, bringing them together with their culture, where you have
the ballet, the opera, the theatre, the art world. Everybody has
a centre of excellence in which they can congregate to have exhibitions,
have shows, have screenings et cetera et cetera, so that would
do more. However, there is an enormous amount of contact because
all of the projects that the BFI runs, whether they are in education
or film screenings or lectures or whatever they are, there are
always practitioners from the industry present, or most of the
time there are. People come right across the world to be part
of these projects, so the interaction is good at the moment and
if we get the opportunity to create a film centre it will be excellent.
Q1132 Baroness Eccles of Moulton:
And then they would be able to use the archive even more than
they can at present.
Mr Fellner: The arm that owns the archive is
an extension of the Screen Heritage Fund and the current project
is to start trying to restore and digitise the archive. The ultimate
goal is to have a building which effectively becomes the digital
hub for the world, where you create the film centre and that is
where you have the film festival and you have all of the physical
practical work of the BFI ongoing. From that emanates to the regions
and to the world all of the digitised archive that can then be
accessed by anybody anywhere. That is the Holy Grail.
Q1133 Baroness Eccles of Moulton:
Ms Nevill, would it be possible for you to quantify the economic
contribution that the Institute makes to the UK film industry?
I know you have given us one example about the online DVD ordering
and I cannot wait to go home and do it.
Ms Nevill: Thank you.
Mr Fellner: Can I say one thing, since Amanda
has been involved in the BFI the number between the grant in aid
and the total money spent at the BFI or the revenue of the BFI
has gown enormously. What that shows is that the executive there
are now on top of creating a modern BFI. I have only been a governor
for five and a half years, but when I came, about the same time
as Amanda, the BFI was in a very sorry state. If the truth be
known, if it had not been for John Paul Getty it probably would
not even have existed any more because the funding was so huge
from him and so minimal in the way in which it was used by the
BFI and the funding from the Government. What this shows is that
if the BFI is targeted carefully, clearly and properly the financial
impacts can be greater because they can do way, way more with
less. Sorry, I hijacked the question.
Ms Nevill: It was a much more eloquent reply
than I could have given, thank you Eric, because the answer is
I cannot. I would not know how to do that with a cultural institution
and perhaps I should find out if any of the other big cultural
institutions manage to do it because it would be interesting.
Chairman: Before going to Lord Maxton can I
bring in Lady Bonham Carter?
Q1134 Baroness Bonham Carter of Yarnbury:
I was interested in you saying, particularly coming after our
last session which was with the distributors, that you showed
films that others will not distribute, and you talked about a
Fellini season at the Southbank. Are they only shown in London
or do you have outlets outside London?
Ms Nevill: We are the biggest distributor of
cultural cinema in Britain and we have a saying that no screen
is too small or too remote, so whether you are a tiny film society
on the Isle of Unst or whether you are a multiplex in Birmingham,
we try and give both as much love and what have you as we can.
Q1135 Baroness Bonham Carter of Yarnbury:
You probably do not get into the multiplex at Birmingham, do you?
Ms Nevill: We do not get into the multiplexes
and I have some sympathy because they have a commercial imperative.
One of the things that was missed arguably in the conversation
about the difference between the independents and multiplexes
is what is the motivation? So the motivation for the multiplexes
is they are there to show great films, and we the BFI think they
are great films as well, but they are there to make money and,
by and large, those films go in and are selected on the strength
of the brand and the marketing impact that is behind them, so
they are almost in the nicest possible way garages: the film goes
in, the studios, the producers, the distributors have done all
the marketing, they have actually built that property. With the
independent cinemas they are building audiences on a day to day
basis and it is a tiny, tiny fraction of the market. We bring
in, say, our back catalogue of the titles that we make available
for distribution; we have not got the sort of marketing and one
could never justify it, so we have to work with that smaller network
of cinemas and work really hard to build audiences for it. The
one thingand I have not got the figures herethat
does cause me some anxiety is that the funding in the regions
for those independent cinemas is diminishing and therefore our
ability to even get that diverse cinema that we are very privileged
to be able to bring into London, to get it out there gets more
difficult.
Q1136 Lord Maxton: I am slightly
confused because, coming from Scotland, as far as I understand
it the Scottish film archive is held at present by the Scottish
Film Council but about to be going to the new amalgamated archive;
is that right?
Ms Nevill: It absolutely is. The Scottish archive
is an interesting one; in theory we are the national archive but
Scotland has the national archive of Scotland and it has some
fabulous material in it. We actually work very closely with themfor
example, we recently restored all the Margaret Tate materials
for you and we often come in like a lifeboat and help out with
things like restoring nitrate.
Q1137 Lord Maxton: The other major
archive in this country of course is the BBC's archive which Greg
Dyke promised when he was Director General would become free for
everyone to watch on the internet, but somehow it has never quite
happened. Do you have any relationship with the BBC in terms of
their archive, in terms of cross-referencing and that sort of
thing?
Ms Nevill: Yes, we do. I would say that the
actual delivery of that is very immature at the moment but we
have just signed an MOU with themwe have a very close working
relationship with Roly Keating who is now heading up the BBC archive
and they are now a part of the screen heritage. The BFI is leading
on behalf of the Film Council on this screen heritage initiative
that Eric spoke about, and one of the fundamental things that
we are doing there is to try and get over time the data of all
the moving image archives within one common union database, and
the BBC are coming in on that. The other areaand I am going
to say it out loud because it would be good to have itis
that there are ways in which the BBC could really help us. For
example, we are very keen and we have talked to them about the
option of us using the iPlayer for the playback of digitised material
from the BFI archive.
Q1138 Lord Macdonald of Tradeston:
I declare an interest here as a former governor of the BFI but
that was about ten years ago and we were still struggling with
the huge burden of deteriorating celluloid and nitrate stock and
so on. Where have you got to with all the money you have had in
recent years in tackling that problem? Is it still a big issue
or is it largely solved?
Ms Nevill: Gosh no, it is not solved yet. The
money is pledged and there but we are still waiting at this moment
for the DCMS capital plan to be signed off; we are told it is
just a formality. What we have done is what I would call triage
work in the last three years so we have driven massive economies
through in other parts of the organisation so that we could do
emergency work, so we have got most of the critical master material
into an environment which minimises decay, so in other words it
is decaying at a lot lower speed than it was doing previously.
That is a huge piece of work, and what the screen heritage monies
will doand it will only be phase oneis it will allow
us to build two vaults where we can put the material. Film is
not decaying because we have done anything to it, but the moment
it leaves the chemistry lab or wherever it comes out of it starts
to decay. The screen heritage monies will mean that we can build
two vaults and we can freeze this material. That means that rather
than having to spend money restoring and copying it just because
it is decaying, it will stop the decayit will not mend
itand it then means that we can take materials out and
restore them according to the cultural plan and what we believe
the public are likely to be interested in at this moment.
Q1139 Lord Macdonald of Tradeston:
Could you just give us a context for that? How much material is
there in that condition that will still have to be worked on?
How many years will it take and how much money will it take if
we want to have an archive where everything has been transferred
properly and is now stabilised, preserved and accessible?
Ms Nevill: Thank you very much for this question.
We made a decision six years ago. Ten years ago the accepted wisdom
for film preservation was that you copied the whole lot onto a
different medium. If you have an archive where you only have 25,000
titles like, for example, the Danish film archive, you can envisage
a scenario where you could achieve that. When you have an archive
as large as the British film archive, which is 37 acresso
it is bigger and more significant than the archive in the library
of Congresswe worked out that it was going to cost over
£100 million and even if somebody gave you a cheque the notion
that you could get the skills and actually copy the stuff in timeyou
were not going to get there. We worked with the Image Permanence
Institute in North America and we found that if we froze the material
that would stop deterioration. We therefore moved from a policy
of trying to copy everything to freezing it. If you have frozen
it you can then say, right, we will start to pull out the material
as best we can over the years that come and we can start to restore,
preserve and digitise because the end game is getting that material
out before the public. Shall I just jump to the cost? If we were
to finish the physical housing of it we estimate that between
£15 and £29 million extra is going to be needed over
the next two or three years but the critical master material will
be in the best environment possible as soon as we have built these
vaults, in about 18 months.
Mr Fellner: You will be pleased to hear Leslie
Hardcastle is still out fighting the fightwho I imagine
was there when you were there.
Q1140 Lord Macdonald of Tradeston:
Yes, indeed. I remember about 30 years ago making a series on
early film and one of the researchers coming back and saying "They
are doing it for posterity but they do not really want to give
us any access". My question related to that is clearly there
is an enormous commitment to film and preserving film on the part
of your staff and so on, and they will preserve things even if,
for reasons of copyright, it is impossible for you to show them,
or they might be preserving American B movies which you would
put in a lower scale of preference, perhaps, to some of the important
British material. How have you managed to tackle those kinds of
issues and prioritise what you are doing at the moment?
Ms Nevill: The first thing is that the mindset
is completely turned upside down: six years ago when we bought
the strategy we talked about turning the BFI inside out. Internationally
we are the busiest film archive, so in other words our commitment
is to getting that material out in every way that we possibly
can, whether it is on YouTube or through DVDs. We are very committed
to it. In terms of controlling what we acquirebecause you
are absolutely right, you have to be very careful with taxpayers'
money, it is a very expensive commitment to take on a filmwe
have a collecting policy which we drew up five years ago. We are
just in the process of revisiting again that collecting policy,
and it is that collecting policy that dictates. Then there are
various structures in place where we go back to curators and challenge
them every quarterin fact we did so yesterdayto
make sure that they are not, as you say, drifting outside what
we decided we want to collect.
Q1141 Lord Macdonald of Tradeston:
I see here you have 675,000 television programmes; given the explosion
into the infinite of television channels how do you make that
choice now, how is that made affordable? Has the industry given
you enough money or do you want to top slice the BBC?
Ms Nevill: We are now digital and what we actually
do with television is that we record off air but we only record
terrestrial channels at the moment, which is an issue in its own
right. We record everything and then we go back two or three weeks
later and we get rid of probably 80 % of it. The reason we do
it that way unlike films is because television often picks up
things you do not know are going to happen, obviously, so we do
it in retrospect. The big issue for usand I think I have
brought it up but we have not completely got our heads around
itis that when we move into the digital world, you are
absolutely right, who is going to fund the national television
archive? The national television archive at the moment is funded
by just under £1 million that we fight for very hard through
Ofcom, from Channel 4, ITV and Channel 5. I have a lot of sympathy
for them, they are in an extremely difficult economic environment
at the moment so that is a deeply unanswered question and one
that we need to address. What we are proposing to do as an organisation
is to lead a working party to start looking at what the solutions
might be, and it would be extremely valuable and helpful to have
this Committee's support to getting the broadcasters on side to
work with us to address the issue you have raised.
Chairman: Can I bring in Lord Inglewood and then
Lord King?
Q1142 Lord Inglewood: In terms of
early film is there a "lot more out there" that will
turn up and be of interest to the Institute or will the material
now being graded separately mean that probably there is not much?
Ms Nevill: The irony is that nitrate film actually
has been shown to last longer than acetate, so now we copy onto
polyester because that is inert. It is such a good question because
people always assume that we have this wonderful luxury of being
able to say let us take in Slumdog Millionaire today and
something else. Usually what happens is that somebody turns up
with a pantechnicon and says this studio is closing or this post-production
house is closing, we are either going to trash all of this or
we are going to give it to you. Even Channel 4 gave us 4,000 prints
of films and we have to really weigh it up, so a huge amount of
time is spent sifting to make sure that we do not lose it, so
we do have to take big pragmatic decisions about the material
that comes in. In terms of silent film, worldwide we have got
such a tiny slice of itwe run programmes called Missing
Believed Lost and Initiative to try and dig things
out, and it is not unheard ofwhich is why we have a special
licencefor people to turn up to Stephen Street with ten
cans of nitrate film which is probably enough to blow us all up.
Q1143 Lord Inglewood: Do you think
there is quite a lot still out there or not?
Ms Nevill: I do not know; I do not think I can
give you an intelligent answer. I would have to say it would be
fantastic if there was.
Q1144 Lord Inglewood: I know it is
a silly question.
Ms Nevill: No, it is a really interesting one.
Let us hope that there is a lot more early silent nitrate film
out there.
Q1145 Lord King of Bridgwater: I
may have missed it but I am not quite clear, are you trying to
keep everything?
Ms Nevill: No.
Q1146 Lord King of Bridgwater: That
is what I was not quite clear about. There are these huge quantities
of programmes you are talking about; have you got some sort of
committee structure that looks and sees what you keep and what
you do not keep?
Ms Nevill: Yes, we do. Television is less of
a concern because it is digital now.
Q1147 Lord King of Bridgwater: So
because it is easier to keep you will keep lots of it.
Ms Nevill: No, sorry, we have actually decreased
the amount we are collecting now. We went through a review with
the broadcasters and agreed with them that we would decrease the
amount and we are actually going back in retrospect.
Q1148 Lord King of Bridgwater: Who
is making the judgment as to what you keep?
Ms Nevill: The BFI curators.
Q1149 Lord King of Bridgwater: Independently.
Ms Nevill: No, what we have is we have a collecting
policy which we do in wide consultation. We also have what we
call an Acquisitions Review Board which meets quarterlywe
had one yesterday which I chair personallyand in theory
that Acquisitions Review Board reports into the Governor's Archive
Committee.
Q1150 Lord King of Bridgwater: So
you are protected against one person's particular hobbyhorse that
might lose us some very valuable things from the archive, mainly
because it was not their personal choice?
Ms Nevill: We are. The reason I would not say
this is a perfect science is because I think the biggest and most
responsible task that a national institution looking after the
national archive has is to make those decisions. My background
is museums and archives and if you look back across archives they
are full of wonderful eccentricities and part of the big problem
is that you often are acquiring things, trying to look into a
glass ball to determine what the public might be interested in
in 75 years. For example, television adverts which nobody was
collecting; in a previous life I know we sucked all those up into
the museum and of course now they are a wonderful picture of social
ways at the time.
Q1151 Baroness Howe of Idlicote:
I have been absolutely fascinated by what has been happening since
I was involved with things like the Museum of the Moving Image,
which presumably will all become part of the great big exhibition
place that you are planning, but on the training side how much
involvement do you have in the process? How important is it where
you are recruiting from because obviously you are doing something
on the digital side, training people, beginning to do that and
hopefully getting funding for that, but what other aspects of
training are you meeting or trying to encourage in appropriate
areas?
Mr Fellner: The educational side of the BF I
is a critical piece of the puzzle.
Ms Nevill: Can I address the wider spectrum
of education or do you want me to specifically look at training?
Q1152 Baroness Howe of Idlicote:
Yes, that is fine.
Ms Nevill: Training for the industry is done
magnificently I think through Skillset which, as you know, is
funded from the Film Council. Where we go in education is really
three areas: one is the formal area where we have worked massively
on this project called Reframing Literacy which is about
getting film used across the curriculum in schools and then evaluating
it. We have had huge success there and local authorities have
really bought into it. The second area is what I would call the
informal area or the development of audiences and what we do is
we pilot a lot of projects down on BFI Southbank, so for example
there we have a project called Future Film Institute where we
have this young group of people who change all the time. They
get to do everything that the BFI doesthey have their own
festival, they programme the BFI, they help outside, all those
sorts of things. The third area which is really important is our
relationship with higher education because so much of what we
deliver is for the benefit of higher education, so access to the
archive, the library. There are huge amounts of digital resources
that we provide onlinebecause we are absolutely seen as
probably the world's greatest centre of knowledge about everything
you need to know about filmand also quid pro quo: without
the relationship with higher education we could not fund or resource
a lot of the activities we do.
Q1153 Baroness Bonham Carter of Yarnbury:
Following on with this theme, one of your objectives is to encourage
the development of the art of film and television and one of you
said earlier that film is seen as a poor cousin in the cultural
arena. One of the things that has come through in the evidence
we have been getting is a concern that training schemes are being
cut, that there are plenty of media courses but not enough practical
training and it is going back to something that Eric Fellner said
about how critical new blood is in the industry. Is this something
that concerns you?
Ms Nevill: I do not feel sufficiently equipped
to comment on where the actual funding to it is. We would absolutely
share the concern if the level of funding Skillset has got is
going to be threatened because
Q1154 Baroness Bonham Carter of Yarnbury:
ITV has pulled out of Skillset.
Ms Nevill: It has, yes. We would absolutely
share that concern.
Mr Fellner: Outside the BFI I can answer the
question; is it appropriate to do that?
Q1155 Chairman: Yes, please go on.
Mr Fellner: I see that there is a distinct lack
of skills, especially on my side of things, production. Any industry
is led by its leaders, led by its entrepreneurs, and we are not
training enough people to go into that side of the industry. Whether
it is because the brightest and the best have been misledapologies
if anyone is in the financial worldin going into that arena
over the last five or ten yearsmaybe now we will see people
who are more interested in it. I get inundated with people wanting
everything from work experience through to jobs during university
periods and then after university and none of them, even if they
have done media studies, has a clue about how the industry really
works. That is something that has to be addressed. In terms of
the crafts the skills are working really wellteaching cameramen
and designers, costume designers et cetera et cetera, it just
works well. On the business side however it is very poor still.
Q1156 Chairman: It is the training
for the business which is core, understanding the business and
evolving the business is where you find there is a big lack.
Mr Fellner: Absolutely. There is another element
to it which is that there are not enough companies, especially
on the film side. There are ourselves, Film4, the BBCI
am stretching already to try and find organisations that have
some form of pyramid executive structure that allows people to
grow and learn on the job, so there is that problem in itself.
There is also the fact that ultimately anybody who is intelligent,
has commitment and has some form of taste and marketing knowledge
can be a film producer, so the barriers to entry are very, very
low. I hate to say that because it shows that I am obviously not
that talented, but they are very, very low. It is tough.
Q1157 Baroness Bonham Carter of Yarnbury:
What is your solution?
Mr Fellner: I was originally involved in Skillset
scheme five or six years ago when I first started and there was
great talk and fanfare of a fulltime business film course and
it ended up being a very diluted, one day a week, CASS business
school type of thing, purely because the money got diluted and
diluted and that is all they could deliver. The quality of the
lecturers was not as good as it should have been, the quality
of on the job training was not as good, so what we did actually
at my company was we just decided to set up our own internship.
We finance it fully ourselves, it costs us a couple of hundred
grand a year and we just think it is worth putting that kind of
money in. We can give three places and we train people right across
the board. All of the people that we have trained have since gone
on to work in the industry and are starting to develop business
skills and creative skills to take them into, hopefully, being
the leaders of the future. It is a difficult one because the industry
is smallyou have probably discovered that over the last
few weeks.
Q1158 Chairman: To what extent does
it deserve the description of cottage industry at times?
Mr Fellner: It is not cottage in that the revenue
generated by it, if you go all the way through the food chain
from cinemas to DVDs to TV revenue to employment, all areas of
it, including production, it is quite a big chunk of money. But
compared to the global force of Hollywood it is a small industry
and it is cyclical, it is horribly cyclical because it relies
on two things: one is just general opinion that there is a trend.
If you have a Slumdog everyone wants to come and make British
films. It goes all the way back to, I imagine, Chariots of
Fire and maybe even earlier, it comes in waves when the trend
is right for studios to finance British films. The other thing
is the exchange rate which I notice you have talked about extensively,
and that is a major factor. Some of that has been flattened by
the tax break which is a very welcome thing for the industry as
a whole, but what has happened is that even in Americayou
are now seeing tax breaks in California and the idea that California
would have to create a tax break to persuade people to shoot in
Hollywood was unheard of just three or four years ago. But the
tax breaks are so large that are appearing in every state in the
country, mainly due to the recession, that now our 20 % is starting
to look pale so now the exchange rate becomes even more important.
It is a horrible vicious circle where every now and then everything
is right. At the beginning of this year you had Slumdog,
you had the dollar at 1.35 and everything was rosy. Studios fill
up, there is no room in the studio right now. Next year it is
going to be miserable.
Q1159 Lord King of Bridgwater: What
about the exchange rate because we have asked other witnesses
this question. It has been down to 1.35, it has been over two,
it is now 1.64. How do you do that?
Mr Fellner: You cannot. The only commercial
thing you can do is hedge it.
Q1160 Lord King of Bridgwater: Are
you competitive at 1.64, that is my question? Is that a fair rate?
Mr Fellner: I would say it is the upper limit,
beyond that it starts to get expensive. We do have a major benefit
here. I am currently shooting a film in Santa Fe and here in London
right now, so I am watching all the numbers on a daily basis and
comparing them. The competitive edge we have is that we do not
have teamstersI do not know if you all know what teamsters
are. Teamsters are very well-paid and you have to have them on
an American film, we have to have loads of them; here we do not
have to have them and that is a major, major saving in terms of
how we operate.
Q1161 Lord Maxton: The T&G should
wake its ideas up.
Mr Fellner: Let us not advertise that. When
I came into the industry it was impossible because I did not have
a union card so I could not get into the industry, and I could
not get a union card without getting a job.
Q1162 Lord King of Bridgwater: Some
government ended the closed shop.
Mr Fellner: I seem to recall it was early in
my career. I am not sure who it was.
Q1163 Chairman: It is nice to hear
genuine old Labour still speaking. Before I ask Lord Maxton to
respond, presumably it must be the case that a British company
like yours which has size is able to negotiate with more clout
than the smaller companies.
Mr Fellner: Negotiate with exhibitors or who?
Q1164 Chairman: With the distributors,
the exhibitors, everyone.
Mr Fellner: Absolutely. It is a success-led
business; if you have a hit you can do whatever you want, if you
do not have hits you are in trouble. The problem with the independent
film business in this country is it has a hit once every two or
three years and, as such, it has very, very little clout. Plus,
the very fact that it is independent means that there are loads
of different factors and every negotiation then has to become
a fight and it is very, very hard. You have had the studios in
here and you have seen that the power they have is enormous. It
comes down to silly little things like shelf space at any of the
retail outlets. If you cannot physically get three feet of shelf
space to put your DVDs on you cannot sell any DVDs. No independent
can get that shelf space because these studios have access to
it.
Q1165 Chairman: What is your batting
average?
Mr Fellner: In terms of?
Q1166 Chairman: You say you have
got to have a success and you have obviously had some good successes,
but there are a huge number of films that we know are really duffs.
What is your batting average?
Mr Fellner: It is today better than most but
it could change tomorrow. We have been very lucky, but what we
have done is we have done something which I would encourage other
independents to do and that is rather than complainI am
not saying they dorather than look at Hollywood as an enemy,
look at Hollywood and embrace them. What we have done is a partnership
in terms of taking everything that we do as well as we can and
utilising everything that they do as well as they can and trying
to get some benefit in bringing it back here. As suchI
am English, I live in England, I want to stay living in England,
I want to support the British film industry, I want our craftsmen
to continue, our talent to continue. So what we have done is we
have gone to Universal Studios, we did a deal with them in 1999
and we brought as much of their money back to the UK to spend
on making British films and then distribute in a way that is hopefully
as commercially successful as possible by using their clout in
the marketplace with British films. One can get slightly distracted
by how much money are we investing in the UK and what are we seeing
as a return, but I think the industry is more than just money,
it is actually about the people, the resources and the revenue
generated by all of that rather than us as an investment bank.
Q1167 Chairman: What about ownership?
You say you did a deal with Universal; does that mean you are
owned by Universal?
Mr Fellner: We actually are owned by Universal.
Working Title is a combinationwe wanted to have a European
partner in so we kept Studio Canal who are a French conglomerate
involved in it. The company is actually owned by General Electric.
Chairman: Yes, we saw the companies earlier.
Q1168 Baroness Eccles of Moulton:
But that still makes you an independent, although you are owned
by them.
Mr Fellner: We are weird because the fruits
of our labours in terms of ownershipthe fruits of my partner
Tim Bevan, who I think you are seeing because he is about to be
involved in the Film Councilthe fruits of our labours and
hence of our employees is as a result of ownership of a share
of the copyright. So we may not own our company but we own a piece
of every film that we make and that is where the real value is.
The value is not actually in the company; it is very hard to make
any money with an independent film company; I would suggest that
it is virtually impossible. The only way you can do it is if you
can access the distribution margin, which is the percentage that
the distributor makes and then you have a share of that. Through
the success that we had in the 1990s we were able to leverage
that position and create an ownership of a piece of that margin.
Q1169 Lord Inglewood: Who is leader
in this context? Is it a separate companyyou say you leveraged
the money out, the company is owned by Universal and you have
a French partner, not a British European partner, but you as it
were derive advantage from the profits you are making through
a percentage of various sales that you achieve.
Mr Fellner: Yes.
Q1170 Lord Inglewood: Is that you
as an individual or do you do it collectively?
Mr Fellner: When we negotiated it we had the
opportunity to do two things: one was to just get the best possible
deal for my partner and myself or to try and get the best possible
deal for a sustainable company that could work through a long
period of time which would include the employees and, ultimately,
all the people that we then employ. We decided to do the latter,
so rather than kind of just saying "Okay, we are guns for
hire, the two of us" we said "No, we are going to stay
with Working Title and we want to use a lot of the negotiable
leverage that we have in making sure that we get a guaranteed
overhead for the company over a long period of time, we want guaranteed
development, we want guaranteed distribution, we want guaranteed
BNA, we want the ability to make films even if the executives
change at the company"which they have done since we
did the deal in 1999, so we could decide to make films ourselves.
It created a sustainable company, which I know is the Holy Grail
that everybody talks about, a sustainable industry, and the reason
that Working Title has stayed around is for two reasons: one that
we have had our fair share of success but in the periods when
we have not done well we have been able to rely on the fact that
we have created an organisation that is properly funded over a
long period of time. The only way we were able to do that is because
we decided to take the big bad wolf as a partner rather than go
up against them.
Q1171 Bishop of Manchester: The final
Report Digital Britain published yesterday says "The
Government believes that piracy of intellectual property for profit
is theft and will be pursued as such through the criminal law."
Earlier this morning we were hearing from the film distributors'
perspective that this is the number one problem facing the industry.
What is your view on that and is there any way in which you are
involved at the moment in trying to come up with ideas which can
prevent or at least limit piracy?
Mr Fellner: It is true it is a major, major
problem. It is theft and as such I was thrilled to see that written
in such a black and white form because we have listened to the
current minister who has waffled and suggested oh well, um, er,
you have to support the people. I was shocked when I heard thatI
went to a BBC conference about piracy and I just could not believe
what I was hearing. Millions and millions and millions of pounds
are invested in trying to create these pieces of material and
it is not a charity, it is a business and it will get decimated
in the same way as the music business did if there is not something
that is done immediately. Sarkozy in France has shown that an
iron will is what is needed; it will be interesting to see how
that plays out now that it has become law over the next 12 months,
but this is a fantastic beginning to an issue that should have
been dealt with years ago. It would have saved the music industry
if it had been dealt with properly.
Q1172 Lord Maxton: How far down do
you go with piracy? If I copy onto my hard drive a film which
I then put onto a DVD and give to my son essentially that is piracy,
although at the moment it is very unclear what the law is in terms
of giving away rather than selling. Where do you draw the line,
that is the problem.
Mr Fellner: If you are giving away in your immediate
circle that is one thing, but if you are giving away to strangerswhich
is what these file sharing things are doing
Q1173 Lord Maxton: For cash.
Mr Fellner: Or for cash, yes.
Q1174 Lord Maxton: The problem is
eventually it may finish up in the hands of a stranger because
I do not know my son's friends.
Mr Fellner: I am not a law maker.
Q1175 Lord Maxton: This is the problem
that we have, is it not, how do you define what piracy is?
Mr Fellner: Can I say one final thing? In South
Korea there is no DVD market any moreI do not know if anyone
has told you that before. There is no DVD market any more because
they have brought in the big fat pipe that delivers at incredible
speed.
Q1176 Bishop of Manchester: What
about within the cinema itself? We were hearing earlier that if
camcorders being used within the cinema could be made illegal
that would make quite a difference. Is that the case?
Mr Fellner: That was the case at the beginning.
There is some of that now but the illegal consumer is so savvy
now that they realise if they really want it they will go and
get a good copy that has been stolen at source. There is still
the pub business of the £2 DVD that has been camcorded but
that is slowly going to be dying out because the quality is such
rubbish and even the people that steal the material want to steal
good stuff, they do not want to steal bad stuff.
Q1177 Bishop of Manchester: Welcoming,
if you have done, what the Government is saying in this Report,
were you to be asked directly what are your ideas for enabling
this to be put into practice, is there anything beyond what you
have already said?
Mr Fellner: It is predominantly policing through
the ISPs.
Q1178 Lord Maxton: Can I just come
in briefly on this because there is an important question on the
next wave of technological advances which will be through the
internet presumably. That will allow smaller films, presumably?
Mr Fellner: Away from the piracy issue.
Q1179 Lord Maxton: Yes.
Mr Fellner: I do not know of any other industry
where five or six companies have controlled an industry for 100
years in the same way as they have in the film business, but they
have done it through three things. They started with property,
physical studios in areas like California and then it spread slightly.
They then did it through controlling the talent, all the talent
was tied up to individual studios. Then they did it with finance
because they were the only ones who could afford to pay for things.
All three of those things have now gone but there is the fourth
which is the only remaining barrier to entry and that is physical
distribution, to have a network of physical distribution and the
ability to get the shelf space, get into the cinemas and do output
deals with television companies around the world. They are the
only ones that have that infrastructure. Once digital distribution
becomes available to any of us in this room, where we can go and
make a film and we can stick it out there, if we can find a couple
of hundred grand or whatever to publicise that material out there,
the final barrier of entry to the industry will disappear and
then the studios will be being competed with by the likes of you
and I. That is not more than five or ten years away; I do not
know if they fully believe that but a lot of people in the industry
believe that.
Q1180 Lord Maxton: So the next form
of technological development is linking in your television set.
Mr Fellner: That you can do with Apple TV. I
do not know enough about the technology companies but we are being
set up basically. They could do it today, there could be one piece
of kit that we could buy today that would have everything on it
but they want us to go 3D and then 3D TV. Yes, once you have got
one piece of kit with a remote keyboard and a remote mouse and
a huge set-up, that is it. The problem is we can break down what
the studios do and we can start to become competitive, but the
revenue model is going to be very hard to work out because at
the moment you get this streaming model, a water-borne model,
from theatrical release to DVD revenue to TV revenue to ancillary
revenues, and the minute that you put something new in there,
nobody quite knows which bits are going to disappear and how much
they are going to disappear, so it is very hard to work out how
to price that new delivery system. The whole thing is quite sensitive
and brittle, therefore, but in the next five or ten years it is
going to be a very different world.
Q1181 Chairman: Thank you. Just one
last question. You sound really quite happy with the progress
that the British Film Institute has made and is making; is there
anything that you want as far as the Institute is concerned, as
far as government is concerned?
Mr Fellner: I will give the non-political response
and then Amanda will give the political response. I just think
that we are scratching the surface. You just have to look at the
grant in aid for some of the other cultural bodies and you realise
that the film industry, film culture, is woefully underfunded
and should be funded in a greater way. Secondly, film has no dialogue
directly with government so it has to go through the Film Council
which ostensibly is a commercial body, so the idea that a cultural
body is funded by a commercial body funded by the Government seems
to be a mis-step to me. I know there are conversations about how
those two bodies will operate in the future, but more money, more
attention, more love would make an enormous amount of difference
from my perspective.
Q1182 Chairman: That is the non-political
answer so you are going to give me a political one.
Ms Nevill: I do not think I will actually.
Q1183 Chairman: Is there anything
else you want to say?
Ms Nevill: Just one tiny little thing. We have
talked massively about the archive and I am sure you all know
this, but the BFI is not just about films of the past, we run
the London Film Festival and we are in the business of bringing
in films by emerging film makers, so it is very much a dynamo.
Also we are leaving some bribes for you here.
Mr Fellner: These numbers are very impressive.
You asked about how many prints go to the regions12,000
prints a year go out of London around the country; 300,000 DVDs
of old BFI library films are sold; 125,000 people come to the
London Film Festival and it shows 300 films from 43 different
countries. As a film producer I never took the London Film Festival
seriously, I would never let any of our films be launched at the
London Film Festival but now we do. With Frost Nixon last
year it has now become a fantastic event, much bigger, and the
industry is now supporting it in a much bigger way.
Q1184 Chairman: Thank you very much.
We have ranged quite wide in the evidence.
Mr Fellner: Sorry about that.
Chairman: Do not apologise, it has been absolutely
fascinating; thank you very much. We may have one or two other
points to put to you but perhaps we might do that by correspondence.
|