Filmmakers get expert tips on financing and film distribution to tap into global market

Kampala, Uganda | THE INDEPENDENT | Film and TV shows in Uganda have for the past two years marked tremendous improvement and growth in quality of the films and overall how best filmmakers can reap from this trade.

Sets have never been busier in Uganda. It all points to the fact that the filmmaking industry is only going to continue growing. Covid-19 drove the demand for content upwards resulting to the uptake in streaming services like Showmax. Pay-tv providers have also ramped up their spending on content, a good example being MultiChoice Uganda which launched three channels (Pearl Magic, Pearl Magic Prime and Pearl Magic Loko) completely dedicated to Ugandan content.

In the last 5 years, the company has commissioned and licensed over 40 shows and films and this number will only keep going up since sustaining three 24-hour channels can be demanding in terms of content.

According to Glen Marques, a South African-based specialist media consultant, there is huge appetite for African content and “it is a good time to be in the industry”.

While the Ugandan filmmaking industry has made steady strides in addressing the gaps in quality and compelling storytelling, producers still struggle with the business aspect – how to make money off their skill set. This is compounded by the lack of any distributing companies whose role is to take the finished product to the market.

Today, filmmaking is big business globally. It is this multi-billion global market that Uganda is looking to tap into.

In 2020, a record-breaking $220.2 billion was spent on making and acquiring new feature films and TV programming, a 16.5 percent increase compared to production spending in 2019. Over two-thirds of global spending in 2020 came from the U.S. and Canada. Some of the top spenders are Disney, Warner/Discovery, Netflix, Amazon/MGM, Fox and Comcast. In Africa and the Middle East, $2.8 billion was spent on producing content in 2020, representing a 46.3 percent surge compared to 2019 spending.

MultiChoice Group’s local content production grew by 32 percent in 2022 bringing its local content library close to 70,000 hours. Local content accounted for the company’s 47 percent of total general entertainment content spend. MultiChoice targets to achieve 50 percent by 2024.

As more platforms emerge and audience demand grows, spending on content production continues to ramp up as well.

Global spending on independent content increased by 25.3 percent in 2020, year-over-year. And this trend will continue as distributors and streaming giants rush to fill their content pipelines that have run dry because of production challenges and delays caused by COVID-19.

In a workshop with Ugandan filmmakers, Marques underscored the need for producers to be keen on the kind of agreements they enter, be it for financing, distribution or selling their content. Key in this is the tendency for distributors and buyers wanting to shortchange content owners.

Marques has worked with MultiChoice Group for over 30 years serving as Chief Operations Officer of SuperSport, chief executive of M-Net, chief operating officer of Showmax as well as overseeing all the entertainment programming and channel acquisitions.

Filmmaking is a capital-intensive venture. Unfortunately, filmmakers in Uganda have to independently mobilize resources for their productions. In a country where the cost of credit remains high with the average lending rate in commercial banks at 18 percent. Unlike other sectors like agriculture and manufacturing which get relatively cheaper credit, businesses in the creative arts are considered high risk to lend to.

The business side of filmmaking begins with the financing – a hurdle that most Ugandan producers still face. Especially since private investors have yet to find film a viable investment option and media companies have been hesitant to buy content.

In other markets, commissioning, pre-sales, grants (by film festivals), licensing, advertising and product placements, crowd sourcing and co-productions are some of the popular financing options. However, like the adage goes, he who pays the piper calls the tune.

“The problem with financiers is, they take control. Always strike a balance between having the artistic freedom and getting the money. Filmmakers tend to lose all the value of their work because they got financing from someone. Be careful and read contracts,” Marques says.

At the point of sourcing financing, it is important to draft a compelling business plan (or investment proposal) detailing the unique selling points, target audience and market potential of one’s film or TV show. This is the information upon which anyone – production companies or studios and investors – looking to finance a project bases their decision.

Marques cautioned producers to be very keen on terms of recoupment. Big studios and other financiers often prefer contract terms which prioritize the financier to recoup (their investment in addition to an extra percentage) first. The implication of this is that the producer would wait a long time and even then, they end up getting peanuts.

Though unpopular in Uganda, options such as acquiring rights to adopt books as well as securing rights for formats are other assets that can generate revenue.

Even when Ugandan producers have circumvented complex finance-related obstacles and wrapped production, getting their films to market is still an uphill task. In advanced markets like U.S., this is the role of distributors.

Distributing a film or TV show on your own can be complex since it involves complex aspects such as intellectual property (moral rights, trademarks, patents, music etc), maneuvering regulatory dynamics in multiple jurisdictions, accounting, cultural complexities among others.

“If you choose to go this route (distribution) alone, you will have to contract with a distributor or sales agent. You have to get the terms right,” Marques said while sharing tips with Ugandan filmmakers.

Top among the things to consider is to identify the target audience based on genre, themes and demographics. This ensures effective marketing and promotion. It is also important to iron out the legal issues by securing the legal rights to images, music and other copyrighted materials as well as obtaining clearances and licenses.

To avoid the burden that comes with handling all this on their own, most producers opt to enlist a company that specializes in distributing since such companies have the expertise and global networks that link them to different markets.

“Before you contract a distributor, make sure they are reputable. Ask them to provide you with references, case studies and their financial standing. Bear in mind they are the ones who will be receiving your money”.

He challenged producers to ask the distributor for critical information; a plan, marketing strategy, timelines and strategy for release, territory-by-territory plan, strategy for festivals, digital marketing plan and the budget they plan to spend.

Adding; “Even when you get a distributor, you have to stay alert. You don’t just hand him your show and assume your work is done. There has to be transparency. Most times, they take the show and the producer is left in the dark. You don’t get updates regarding the marketing process.”

Every producer’s wish is to earn as much as they can from their product. On the other hand, buyers are always looking to get the most out of product even if that is to the disadvantage to the creator. Which is why rights are the gold of the film and TV business.

Some distributors will double as the financiers of the project. In which case, commissions (to the distributor) will be higher. They might as well insist on creative approval rights meaning they will dictate the lead characters, director and have control on story aspects. They will also demand completion bonds, a very alien concept in Africa.

One way to mitigate this risk is negotiating for a minimum guarantee which is a minimum figure that the content owner gets whether or not their content is finally bought.

According to Marques, some distributors exploit contractual loopholes to usurp approval rights on subsequent deals they sign with subletting parties and affiliates.

The person selling content must protect themselves by; limiting the number of exhibitions, demarcate territories properly, specifying and limiting the linear licensed services, ensuring the clauses on exclusivity/holdback are well elaborated, ensuring the license fee amount, payment and default terms are clear and maintaining approval rights.

The workshop on the business of film was one of the many trainings on filmmaking that MultiChoice Uganda has conducted this year, according to Rinaldi Jamugisa, the PR & Communications Manager at MultiChoice Uganda.

“We are excited that filmmakers continue to grow. We want to teach you about the business of film so you can better utilize opportunities, so that you get better at negotiating for contracts,” Jamugisa told attendees.

“It is important to note that if only one filmmaker grows and the rest don’t, the industry won’t grow. Quality won’t get better. You can run 10 sets at the same time but that is not an industry. Let’s uplift one another.”

He urged filmmakers to collaborate, explaining that when one person does all roles on set, it affects the quality of the outcome.