Project-based firms in the UK film industry : causes and consequences

• Main Author: Davenport, John A.
• Published: University of Manchester 2004
• Subjects: 384.8
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.630930

The principal issue of debate in relation to the UK film industry is the sustainability of independent film production companies. In the thesis, it will be argued that the characteristics of these companies are closely related to those of project-based firms, which has key implications for government polices aimed at positive intervention in the development of the industry. An analysis of the critical characteristics of these firms, the interdependencies between these characteristics, and the linkages between firms and other industry agents, will enable the construction of a model of the UK film production company. It will be argued that the operation of this model is critically influenced by external financing and the economic domination of the US major studios. It will further be argued that the difficulty of raising finance for film projects; the protection of intellectual property, as a means of recouping investment; and the related entrepreneurial behaviour encourage the adoption of project-based organization. Using this form of governance helps financial risk to be managed by the use of freelance workers and the minimization of fixed capital. This strategy is possible because of the existence of deregulated labour markets and the availability of a large pool of specialist skills. Crew are obliged to maximize their earnings by conforming to the norms implied by the largely deregulated working environment and by specializing in well-defined roles. Skills development in this system is the responsibility of the individual, who must accept this to advance his or her career. Personal interest thus reinforces the tendency to specialization. Partly because of the fragmentation of the industry, agencies and unions possess little authority. Although the industry depends upon well-developed informal networks for its functioning, these are used predominantly for communication. The key characteristics of the UK film industry are conditioned partly by the business strategy of the US major studios, which outsource work to the UK and return all profits to the US. Dependence upon inward investment leaves the industry at the mercy of an economic or investment downturn and price competition from other countries, while the lack of formal training may undermine the ability of the industry to compete in quality and skills. The thesis therefore concludes with policy recommendations that suggest how the industry might create an environment in which the sustainability of production would be achieved.