The past decade has been tough on Hollywood — both the industry and the place. L.A. has endured a parade of black-swan catastrophes that have repeatedly upended its signature business, including fires, strikes, COVID, the decline of movie theaters and linear TV, and streaming’s boom and bust. Taken together, these disasters have triggered something like an identity crisis. If you call up a couple dozen executives, agents, directors, producers, writers, actors, and below-the-line artists and ask about the scene on the ground right now, they’ll describe a city detached from its old rhythms and sense of purpose. Today’s L.A., a few say, feels more like a Rust Belt crater than the glamorous capital of the world’s entertainment. “It’s so grim, like a sad company town where the mill is closing,” says one executive. “It’s morose, and everybody’s scared,” says the actor and director Mark Duplass. “It’s a bummer to live here now,” says a writer.
Pieces of the business still hum along in the city, albeit more quietly than they used to. Executives and agents are back in the office, at least the ones who weren’t laid off. Pitching and deal-making continue, though much of that now happens over Zoom. But production — the physical process of turning script pages into movies and TV shows — has largely left town. What began years ago as a trickle has suddenly become an exodus. Today, only about a fifth of American movies and shows are filmed in L.A. (...)
Pieces of the business still hum along in the city, albeit more quietly than they used to. Executives and agents are back in the office, at least the ones who weren’t laid off. Pitching and deal-making continue, though much of that now happens over Zoom. But production — the physical process of turning script pages into movies and TV shows — has largely left town. What began years ago as a trickle has suddenly become an exodus. Today, only about a fifth of American movies and shows are filmed in L.A. (...)
As the labor of making movies and shows splinters across far-flung cities and countries, Hollywood has become dislodged from its physical home. Some of these new hubs may suit the needs of individual projects, but none of them offers what L.A. did for most of the past century: a stable gravitational center where crews can make a living and the craft can be passed down. This isn’t just a logistical reorganization; it’s an existential shift, and there may be no going back. “The nucleus that Hollywood grew out of is dying,” says Jonathan Nolan, the writer-director whose work includes Person of Interest, Westworld, and Fallout. “I don’t think Hollywood the industry has much to do with Hollywood the place anymore,” says Lowe.
One reason L.A. even became a city at all is because it was a great place to make movies. (It helped that it was far enough from New Jersey to escape the enforcement of Thomas Edison’s patents on motion-picture cameras and projectors.) The weather allowed for year-round outdoor shooting, attracting the industry’s best filmmakers, actors, and crews. This created a self-reinforcing bubble in which the top talent was all concentrated in the same place; this, in turn, supported an informal apprenticeship system under which younger crew members learned on the job, providing a steady influx of skilled labor. For a long time, there was usually no good reason to shoot anywhere else.
Then, in the 1990s, British Columbia hatched a plan to bring some of that action north. The Canadian provincial government introduced one of the world’s first film tax credits — a financial incentive meant to lure foreign productions — offering a modest rebate on money spent employing local crews. It worked, and many U.S. states took notice. In the early aughts, Louisiana and New Mexico rolled out flashy credits of their own, transforming New Orleans and Albuquerque into viable production hubs.
A short while later, streaming boomed, and the demand for scripted entertainment exploded. With more production in play, regions around the world began ramping up their incentives, and many built soundstages and crew bases that could compete with those in L.A. What followed was a global bakeoff for Hollywood’s business. Canada, the U.K., and Australia enhanced their already aggressive tax credits, often made even more appealing by favorable exchange rates. Many U.S. states, including Georgia and New York, followed. Before long, most of the country, and dozens of countries beyond, were offering some version of a production subsidy.
These incentives can be shockingly generous. Today, producers can shoot in certain locations and receive back 30 to 40 percent of a project’s budget with local taxpayers footing the bill. Unlike traditional tax breaks, which merely reduce what a company owes, these credits often amount to direct cash payments, issued regardless of whether the production generates significant tax revenue in return. New York State, for example, offers a 30 percent base tax credit with a 10 percent bonus for projects made upstate. Last year, New York tax dollars helped subsidize TV shows including HBO’s The Gilded Age (which received $52 million from state coffers), Prime Video’s The Marvelous Mrs. Maisel ($46 million), and Apple TV+’s Severance ($39 million). An Albany-funded audit of New York’s film tax credit, published last year, determined that the incentive is probably a net loss for the state, returning as little as 15 cents in direct tax revenue for every dollar spent. Regardless, in May, New York added an additional $100 million for independent films, bringing the state’s total film subsidies to $800 million.
Meanwhile, California mostly sat on its hands, assuming its long-standing monopoly on talent and infrastructure would be enough to keep Hollywood anchored. Subsidizing an industry already based there was a tougher political sell, but the state introduced its own incentive program in 2009 and has sweetened it since. Unfortunately, while the credit may sound generous, in practice it’s miserly to the point of uselessness.
by Lane Brown, Vulture | Read more:
Image: Alvaro Dominguez
