Presentation on Funding Opportunities for Content Creators DEPARTMENT OF COMMUNICATIONS DTT Rollout and Local Development Workshop 28 MAY 2014 CSIR Conference Centre, Pretoria 1

2 Contents Contents 1.NFVF Mandate 2.NFVF Objectives 3.General South African Funding Overview 4.NFVF Funding for Content 4.1 Development Funding 4.2Production Funding 5. Conclusion

3 1. NFVF Mandate 1. NFVF Mandate Section 3 of National Film and Video Foundation Act No 73, 1997 sets out mandate: To promote and develop the film and video industry. To provide and encourage the provision of opportunities for persons, especially from disadvantaged communities to get involved in the film and video industry. To encourage the development and distribution of local film and video products. To support the nurturing and development of access to the film and video industry. To address historical imbalances in the infrastructure and distribution of skills and resources in the film and video industry.

4 2. NFVF STRATEGIC OBJECTIVES Increase number of SA Films and PDI’s producing them Increase number of people trained in the industry, particularly in areas of scarce skills. Increase audience access to SA Films Promote the SA Film Industry locally and internationally Promote social cohesion and the expression of the nation’s stories through film

5 Government is the biggest funder through NFVF, Film and TV Production Incentive (DTI), Industrial Development Corporation (IDC), National Lottery Distribution Trust Fund, National Empowerment Fund, and some provincial commissions ( Gauteng Film Commission, Kwazulu Natal Film Commission and some provincial government. Development funding only offered by the NFVF. All funders have their own criteria that a project must comply with. Private sector investment is still limited - Section 12O tax rebate for investors underutilised. Average production budget ranges between 6 – 12m. Official/Treaty co-production budgets range between R20m – 300 million. 3. General SA Funding Overview

6 Typical Production Financial Plan This typical finance plan is based on applications received throughout the year by the NFVF. -NFVF : between % of the budget -DTI: 35% cash rebate on qualifying SA expenditure -Gap financier: percentage of shortfall (e.g. IDC, Spier Films, Etana) -IDC: up to 49% of the production budget -International soft funds such as World Cinema Fund: may range up to EUR Producers still struggle to raise production finance despite government funding. 3. General SA Funding Overview cont..

7 General The NFVF welcomes opportunities presented by DTT for content creators. IP ownership by content creators is critical for sustainability of businesses. Commission driven content will not suffice – broadcasters and content creators must explore licensing and other models for procuring independently commissioned content. The NFVF is the only institution that funds the development of projects ( TV concepts, features, documentaries and animated projects) Production funding is given to projects that meet criteria for the production of features, animation, short films and documentaries (a detailed Funding Policy is available on 4. NFVF Funding for Content

8 4 categories of Funding Development Fund Production Fund Marketing, Distribution and Festivals Grant Education and Training Grant According to research, NFVF funding is considered as golden key to attract other potential investors (NFVF Funding Impact Assessment ). The NFVF equity participation is made up of the NFVF’s percentage of the budget according to the recoupment waterfall. Proof of funding for the rest of the production budget must be submitted before funds are released. 4. NFVF Funding for Content cont….

9 What is considered development? any work undertaken to put an idea or concept into writing with an intention of creating a script including research undertaken in a documentary, a short and a feature film whether fiction or real life leading to a script. Grant recoupable on 1 st day of principal photography & usually reinvested in production. Funding Caps Feature length films- R ; (R reserved for script editor) Documentaries- R Short Films - R TV concepts - R Development Funding

10 According to research, NFVF funding is considered as golden key to attract other potential investors (NFVF Funding Impact Assessment ). The NFVF equity participation is made up of the NFVF’s percentage of the budget according to the recoupment waterfall. Proof of funding for the rest of the production budget must be submitted before funds are released. Caps apply as follows: Features- R Feature length Documentaries – R Short/TV Documentaries- R Short Films- R Animation- R Production Funding

Funding Stats for Production & Development 11

2012/13 Provincial Breakdown for Allocation 12

2013/24 Provincial Breakdown of Funds Allocated 13

14 There is a need for private sector funding for content development and production. Collaboration between broadcasters, content creators and regulators ( local content, Intellectual Property) to ensure the opportunities in the digital broadcasting era benefit all players. The creation of digital content hubs will contribute to decentralisation of opportunities outside Gauteng and Western Cape for content creators as well as provincial diversity as envisaged in the DOC Local & Digital Content Strategy 5. Conclusion

THANK YOU Contact Aifheli Makhwanya Head of Policy & Research THANK YOU 15