The Role of Hollywood in Global Film Markets - Assignment Example

The role of Hollywood in global film markets Title: The role of Hollywood in global film markets By: AAAAAA Title: The role of Hollywood in global film markets For: organization for whom the report has been Created Author’s name: Date of fulfillment: Acknowlegdments The researcher would like to acknowledge the guidance of his professors and suggestions from his peers. He would also like to thank the library staff for having made available all the reference books as required and is grateful for their efforts in scouting the online as well as hard-copy database to ensure that everything required for the research was handy. Summary abstract: Hollywood has reined the film production industry since its very inception. With new media technologies at hand and the boom in cultural industries, it is no wonder then that Hollywood, which was one of the first industries to go global, now applies new methods to reach a global audience. A fantastic network of distribution outlets like cable and satellite services link communication products in an effective manner all over the world. With the new digital and media forms, especially with the boom of Do-it-Yourself culture thanks to the convergence of technologies and online sites like You Tube, film production and distribution was never as trendy and profitable. New media forms have thus only served to boost the nexus of Hollywood in the global market. This research is inclined to study the current role of Hollywood in global markets. Executive Summary: This research probes the role of Hollywood in the global market. The history of the association, going back to almost eighty decades, the focus is to analysis the current trends in business and distribution that have influenced the role of media conglomerates. We see the ownership pattern has become more complex than ever, and that the new media technologies also have a vital role to influence the reception of media products, including Hollywood. Moreover, the consumer has become proactive and increasingly calls the shots. As a result, the issue of Cultural imperialism seems to have been settled given that more and more Hollywood productions are now financing local language films, that have a distinct regional touch. A large number of online text were referred to for this study. The details of the literature referred have been provided in the list of references as well as in the bibliography. Table of Contents: Acknowledgements Summary Abstract Executive Summary Research thesis: Hollywood as a Cultural Industry Hollywood accused of Cultural Imperialism Hollywood was always global. What’s new? New trends of corporate ownership. Current Hollywood Crisis, Reasons for expansion in local-language productions in the global markets Conclusion Reference Bibliography Research thesis: Hollywood as a Cultural Industry To understand the role of Hollywood in the global market, let us first look at it as a flourishing Cultural Industry. David Hesmondalgh (2007) in his book, ‘The Cultural Industries’ says that cultural industries have moved closer to the centre of the economic action the world over and can no longer be seen as secondary to the ‘real’ economy where durable, useful goods are manufactured. Indeed, companies like Disney, Rupert Murdoch’s News Corporation are amongst some of the most valued and discussed businesses of the world. The ownership and organisation of the cultural industries has changed radically, with film, publishing, television or recording industries not only compete with each other, but rather are connected in an intricate web of alliance, partnership and joint venture. Cultural products increasingly circulate across national borders. Images, sounds and narratives are borrowed and adapted from other places on an unprecedented scale, producing new hybrids, but also for some, reaffirming the value of cultural authenticity. The long-standing domination of the cultural trade by the USA may be diminishing. Allen Scott (2002) has studied the production and distribution pattern in Hollywood, in his research thesis titled ‘A new map of Hollywood: the production and distribution of American motion pictures’. He opines that the debate on industrial organisation of Hollywood that gained ground in the 1980s was unnecessarily polarized and concludes saying the it must be ready to face some new challenges as new, competing cultural products and means of distribution arise all over the world due to a very proactive consumer base coupled with the unprecedented possibilities of communication offered by the new media. Hollywood accused of Cultural Imperialism Hollywood has long been accused of Cultural Imperialism, but the accusation is getting mellowed down now with more and more Hollywood productions funding local language films, or those films with native themes and not expressly revolving around American situations.   Chinese actress Zhang Ziyi of the ‘Crouching Tiger, Hidden Dragon’ fame was quoted as saying in a reported titled ‘Hollywood hard for Asians’ (2005) that she thought it was really hard to be in Hollywood if you are Asian or Chinese. The presence of Hollywood in global markets had long had, and continues to have, not only economic repercussions, but also an array of socio-cultural effects. Long thought as the producer of post-modern content, the productions of Hollywood were thought for long to spread cultural imperialism, and a consequent, blind adaptation of Western prototypes in global markets. However, Robert W. McChesney (1999) differs with this accusation of cultural imperialism. He says that while the "Hollywood juggernaut" and the specter of US cultural imperialism remains a central concern in many countries, the notion that corporate media firms are merely purveyors of US culture is ever less plausible as the media system becomes increasingly concentrated, commercialized and globalized. Hollywood was always global. What’s new? However, while accessing the impact of global markets on Hollywood, it is important to point out that Hollywood ‘went global’ a long time back. So let us probe what’s new in the current scenario. Wasko notes that to look closely at the international expansion of the U.S film market is an important step towards forming a better understanding of the historical evolution of current globalisation trends. While expansion of global markets might be relatively new for the new media, the US film industry developed global marketing techniques as early as the 1920s and continues its dominant position in international media markets today says Wasko. Perhaps, what has made an impact on hollywood’s recent role in the global markets is the complex nexus of large media conglomerates that own and control all forms of communication media (as will be explained in the course of this text), new media technologies and a sea-change in consumer reactions to the market. New Trends of Corporate Ownership Janet Wasko, (2004) says in his article, ‘The Political Economy of Film’ that these days, film must be considered as part of the larger communications and media industry. What is more significant is that the ownership of these forms of entertainment has witnessed a change like never before. We can observe that most of these varied forms of audio-visual entertainment are under the control of the same corporate ownership. Films are produced by the same companies that are involved with other media and communication activities and it is no secret that fewer and giant organisations control these activities. These multi national corporations have diversified into all areas of the media, sometimes attempting to maximise profitability by building synergy between their corporate divisions. For some of these companies, films play a key role in these synergistic efforts, as corporations such as the Walt Disney build product lines that begin with a film, but continue through television, cable, publishing, theme parks, global merchandising, etc. These days companies like Disney not only distribute products to these outlets, but also own the outlets. Thus, large cultural industry conglomerates own varied channels of communication- from radio, to television, from newspapers, magazines, music companies, animation production houses, to film studios. The web of entertainment was never so financially complex (and rewarding) as it is observed to be today. Robert W. McChesney (1999) asserts that the global media system is fundamentally noncompetitive in any meaningful economic sense of the term. Many of the largest media firms have some of the same major shareholders, own pieces of one another or have interlocking boards of directors. When Variety compiled its list of the fifty largest global media firms for 1997, it observed that "merger mania" and cross-ownership had "resulted in a complex web of interrelationships" that will "make you dizzy." Thus, the relationship between the mass media and the national culture is undergoing a dramatic evolution. Mass media hegemony, once a matter of one national culture dominating another, can no longer explain the national character of the institutions of mass media. Instead, deracinated transnational media now dominate all national audiences. This shift is still obscure, particularly in film and television, where the institutions producing and distributing culture are still the direct descendants of traditional Hollywood film companies such as Time-Warner, Sony Pictures, Fox, Disney and others. By concentrating on the financing of American films, (the act which initiates the cycle of production, distribution and reception) the history of Hollywood transnationalisation can be isolated. When the American film triumphed on the international market eighty years ago, a metaphor developed of America sharing its culture with the rest of the world. Today, the scene has changed and on a per capita income, the American viewer is of no more importance than any other member of the global audience. The key moment occurred in the seventies, with the international financing innovations of the film producer Dino De Laurentiis and the banker Frans Afman. They pioneered the present landscape where funds from everywhere, intermingle and merge at Los Angeles to finance films for the world. Current Hollywood Crisis, Reasons for expansion in local-language productions in the global markets Film ticket sales in multiplexes in the United States have been uncertain in the last few years. As compared to the sales in America, the Asian markets offer a brighter picture and the recent trend in Hollywood is to take note of the Asian markets to reap profits. As Laura Holsen (2006) remarked in her article, ‘Hollywood’s Road Trip’ published in the New York Times in April 2006, more and Hollywood studios now seem keen to finance local language film ventures in Asian markets, a situation that was rare in yester years. Laura supports her article with startling statistics. For example Kung Fu Castle, a Chinese language action comedy financed by Sony Pictures grossed $67 million in China and another $34 million from other countries. The Walt Disney Company and Twentieth Century Fox have also financed local language ventures in China and Brazil. Sony, along with Warner Brothers Entertainment has become a master of the trend in global markets, having flagged local-language productions in India, Russia and Mexico in 2006. However, though a large sum is now being currently invested by Hollywood in local-language productions, the market is still small as compared to the mainstream American box office status. For example, while 549 new movies were released in the United States alone in 2005, only a one-third of this number are the total number of local-language films financed by Hollywood studios since 2000 mentions Laura in the article. Thus, though Hollywood’s interaction with global markets is on the rise, the profits aren’t as high as could be expected. According to Richard Fox, executive vice president of international at Warner Brothers Entertainment, it is still not fair to compare most markets to the United States. The main hurdle for studios is that they have very less control over film theatres. In spite of the fact that 24-screen multiplexes are hugely uncommon there, countries like Russia, Brazil and South Korea even have a very petty number of single-screen theatres. This makes the screening of an American-style wide release virtually impossible. The revenues would increase tremendously if the viewing conditions were made up-to-date. For example, had Fox's ‘If I Were You’ released in USA, it would have had screened at as many as 3,700 screens, as compared to the only 200 theatres that it was shown in Brazil. The revenue made is Brazil was $11.5 million. By contrast, a blockbuster, if released in close to 3,700 screens in the USA, can gross up to $65 million in its first weekend. In his book, ‘Understanding Media Economics’, Gillian Doyle, (2002) throws light on how film revenue is generated. He says that films tend to earn most of their income in three categories of release window- cinema box-office, video and television. The cinema- box-office has traditionally been the main source of income but the revenues from videos (rentals or retail) grew very strongly throughout the 1980s. Since the mid 1990s, the proportion of film revenue accounted for by the television window has\ increased rapidly alongside growth in a number of movie based subscription channels. Says Allen Scott (2005) in his book, ‘On Hollywood: The Place, The Industry’ that along with Silicon Valley and the business and financial clusters of New York and the city of London, Hollywood must surely rank as one of the most highly developed agglomerations of productive activity anywhere, and a major urban phenomenon in its own right. Robert W. McChesney (1999) points out that the major media companies have moved aggressively to become global players. Even Time Warner and Disney, which still get most of their revenues in the United States, project non-US sales to yield a majority of their revenues within a decade. The point is to capitalize on the potential for growth abroad--and not get outflanked by competitors--since the US market is well developed and only permits incremental expansion. As Viacom CEO Sumner Redstone has put it, "Companies are focusing on those markets promising the best return, which means overseas." Frank Biondi, former chairman of Seagram's Universal Studios, asserts that "99 percent of the success of these companies long-term is going to be successful execution offshore." Toby Miller (2007) cites reasons for Hollywood’s economic crisis. The first serious threat to Hollywood is that people have almost stopped frequenting cinemas. Moreover, television viewing is not in a manner where advertisers can sufficiently reap marketing benefits. The consumers have become immune to the repetitive television ads, so to say and hence new means of marketing must be developed. Further, the capacity to create and distribute high-resolution screen text is cheaper and easier than ever before due to new media technologies. It is these technologies that are expected to change the scenario of production and distribution of Hollywood content in the time to come, i.e. if the change has already not set firmly. Conclusion: That Hollywood reigns supreme as far as finance and money-making is concerned the world over is a unanimous statement. Now that Hollywood is changing its approach towards marketing and investing directly in local-language films, only lending the financial support and studio name. This move will ensure that it reaps more profits in the time to come. Such a move will help Hollywood enter the niche markets that were till now beyond its reach and dominated by a class of films that were extremely indigenous to the regions of their production. By extending its horizons in markets in Japan, China, Russia, France, India and other countries and winning over the audience with productions that they can identify with, Hollywood seems to have adopted a novel technique to find its footing in global markets. Moreover, we must note that for the same reasons, Hollywood is getting rid of its tag as a means of spreading cultural imperialism. By adopting style and stories that are familiar with the native audiences where Hollywood productions are released, Hollywood is now carving a niche within the markets that were so far ignored. The lack of proper infrastructure in many countries, however may be detrimental in getting as much profits as is expected. As we have discussed before, if Hollywood’s global outreach is accompanied with infrastructural development in these countries with more facilities of multiple-screens in a movie complex, Hollywood is likely to gross in much more profit than observed till this date. Reference: Doyle, Gillian, (2002), ‘Understanding Media Economics’, pp-101 viewed on May 5, 2008, URL: http://books.google.co.in/books?id=V7AFTab1qC4C&dq=doyle+g+2002+understanding+media+economic+%22london+sage%22&pg=PP1&ots=CgDT2IyUwj&source=citation&sig=j56vnx7fm55P5zhGgLKELnE8_cQ&hl=en&prev=http://www.google.co.in/search%3Fhl%3Den%26q%3DDoyle,G.(2002)%2BUnderstanding%2BMedia%2BEconomic.%2BLondon:Sage%26btnG%3DSearch&sa=X&oi=print&ct=result&cd=1&cad=bottom-3results#PPA101,M1 Hesmondalgh, David, 2007 ‘The Cultural Industries, Sage Publication, pp1-3, Viewed on May 5, 2008, URL: http://books.google.co.in/books?hl=en&id=AlEig8UERpEC&dq=cultural+industries&printsec=frontcover&source=web&ots=DbdwEWkKcK&sig=X38o-D2kk--k0h2t628thaAUzuE#PPA3,M1 Hollywood hard for Asians, Embassy of People’s Republic of China in United States of America, published on May 24, 2005, viewed on May 5, 2008, URL: http://www.china-embassy.org/eng/xw/t197027.htm Holson, Laura, M, (2006), ‘Hollywood’s Road Trip’, The New York Times, published April 3, 2006, viewed on May 5, 2008, URL: http://www.nytimes.com/2006/04/03/business/03movies.html?_r=1&oref=slogin McChesney, Robert W., 1999, ‘The New Global Media’, viewed on May 5, 2008, URL: http://media.library.ku.edu.tr/reserve/resspring06/CIVL%20202%20P.Ozyurek/the%20new%20global%20media.pdf Miller, Toby, 2007, Global Hollywood 2010, International Journal of Communication 1 (2007), Feature 1-4, viewed on May 5, 2008, URL: http://www.ijoc.org/ojs/index.php/ijoc/article/viewFile/52/24 Scott, Allen, 2005, ‘On Hollywood: The Place, The Industry’ viewed on May 5, 2008, URL: http://books.google.com/books?hl=en&lr=&id=EzCOBoy1o_MC&oi=fnd&pg=PP16&dq=Hollywood+industry&ots=R7fWKftrd6&sig=6CeZzjKj2HheXtJG_N8WjGJ_a68#PPP17,M1 Scott, Allen, 2002, ‘A new map of Hollywood: the production and distribution of American motion pictures’, viewed on May 5, 2008, URL: http://www.informaworld.com/smpp/content~content=a738552489~db=all Wasko, Janet, 2004 ‘The Political Economy of Film’, Chapter 13- A Companion to Film Theory edited by Miller, Toby and Stam, Robert, pp229-230, viewed on May 5, 2008, URL: http://books.google.com/books?hl=en&lr=&id=wAVYK2nnRysC&oi=fnd&pg=PA221&dq=Wasko,J.(1994)&ots=OFeHulBrrg&sig=zYHys8_iDtIVQdVZu4iclQyTFNk#PPA230,M1 Wasser, Frederick, ‘The trans-nationalization of the American film industry’, pp364-365, published in ‘Hollywood: Critical Concepts in Media and Cultural Studies’, edited by Thomas Schatz, viewed on May 5, 2008, URL: http://books.google.co.in/books?id=YOasz7CE0TUC&pg=PA4&lpg=PA4&dq=hollywood+as+a+cultural+industry&source=web&ots=ElIeBUHTYs&sig=wfsOfkyx8uZ0ImsvLi9hvA0YW-s&hl=en#PPA365,M1 Bibliography Hesmondhalgh,D.(2007)The Cultural Industries(2nd Edition).London;Sage Doyle,G.(2002) Understanding Media Economic. London:Sage Hesmondhalgh,D.(ed)(2002) Media Production.Berkshire:Open University Press Doyle,G.(2002) Media Ownership.London:Sage Herman,E. and R.McChesney(1997)The Global Media: The new missionaries of global capitalism.Cassell. Moul,C.(ed)(2005) A concise Handbook of Movie Industry Economic. Cambridge:Cambridge University Press. Wasko,J.(1994)Hollywood in an Information Age.Cambridge:Polity Wasko,J.(2003)How Hollywood Works.London: Sage Wayne,M.(ed)(2005)Understanding Film:Marxist Perspectives.London:Pluto (especially chapters 7&8) Wayne,M.(2003)'Post-Fordism,Monopoly Capitalism and Hollywood's Media -Industrial Complex',International Journal of Cultural Studies,Vol.6(1) Read More