Offset changes a ‘missed opportunity’ for further reform

Industry guilds and the free-to-air broadcasters alike have expressed dismay over the Federal Government’s move late last week to extend the Post, Digital and Visual (PDV) and Location Offsets to online platforms, arguing the government has missed an opportunity to introduce further policies that could benefit the local industry.

The adjustment to the offset legislation was announced last Thursday just hours before Prime Minister Scott Morrison called the federal election and the government entered caretaker mode.

Specifically, the move allows series and mini-series intended for distribution by streaming services like Netflix and Amazon Prime to take advantage of the PDV and Location Offsets – previously only feature films for such services were eligible for the rebates. The government has said this move will make “Australia an even more attractive environment for screen production and provide more opportunities for the thousands of highly-skilled Australian professionals working in the industry.”

However, the guilds behind the Make It Australian campaign – Screen Producers Australia (SPA), Media, Entertainment and Arts Alliance (MEAA), the Australian Directors’ Guild (ADG) and the Australian Writers Guild (AWG) – have long been pushing, inter alia, for the government to impose local content obligations on SVOD platforms. At present, the proportion of local content on Stan is just 11.1 per cent, while only 1.6 per cent of content in Netflix’s Australian catalogue is Australian.

Sustainable policies to ensure ongoing availability and production of local content have been the focus of a myriad of reviews the last few years, including both House of Representatives and Senate inquiries. The government also launched the Australian and Children’s Screen Content Review in 2017, to be conducted by the Department of Communications and the Arts, Screen Australia and ACMA. However, the results of this review have not been publicly released.

The Make Australian campaign today argued the government’s decision was “another missed opportunity” to require SVOD platforms operating in Australia to invest in local stories.

“Allowing streaming services to benefit from tax-payer funded offsets without any requirement to invest in our stories sells Australian audiences short and means fewer Australian stories being seen around the world,’ said MEAA CEO Paul Murphy.

ADG CEO Kingston Anderson said the policy announcement was “inexplicable” and “one-dimensional”, given how many times the industry has called for action.

“Our screen incentives need to be updated across the board, not just those that apply to international production. This decision shows a tremendous lack of confidence in the ability of Australians to tell our stories in our own voices.”

AWG executive director Jacqueline Elaine said: “Once again, the government’s rhetoric of supporting Australian stories is at odds with their sustained and embarrassing policy inaction on original content creation and promotion by the streaming service.”

SPA CEO Matthew Deaner noted that independent and smaller-budget productions represent the vast majority of Australian screen stories, accounting for over 45 per cent of screen content produced annually in Australia.

“These SMEs play an essential role in skill development and training as well as promoting innovation, creativity and risk taking. The overall health of the local Australian screen industry requires careful policy considerations. It is essential that we promote a legislative and policy framework that supports Australian stories.”

Free TV Australia – which represents the commercial broadcasters – has also criticised the government’s decision. CEO Bridget Fair called it “deeply disappointing”, arguing the government was propping up unregulated foreign streaming platforms, while leaving commercial broadcasters saddled with outdated content obligations that no longer reflect how Australians consume content.

“This announcement is outrageous. It has been six years since the Coalition Government was elected. Free TV has consistently sought meaningful reform of content regulations that have been in place since the 1980’s.  The Australian Content Review was conducted in 2017. After two years, Minister Fifield has seen fit to announce a single initiative five minutes before the commencement of the caretaker period that benefits foreign multinational streaming services like Netflix and Amazon Prime,” she said.

“Commercial television broadcasters are the source of more Australian production than anyone else in this country. The government should be looking to how broadcasters can be assisted to continue the important role they play in the Australian production industry, not making piecemeal decisions that advantage unregulated competitors on digital platforms.”

However, others in the industry – such as Adelaide VFX maestros Rising Sun Pictures, likely to benefit from the PDV change – have welcomed the government’s decision.

RSP managing director Tony Clark said: “This is a game changer for the entire industry and will make Australia a front runner in the new frontier of streaming production. It will allow our country to reliably build capability due to a consistent pipeline of work and create significant employment opportunities. Not only will it bring benefits to the local economy, but it will also allow us to build ongoing relationships with online streaming companies, something which has been lacking in recent years as other destinations offered stronger incentives”.