movie industry

[ANALYSIS] Will there be a new golden age in Philippine cinema after record-breaking MMFF?

Isagani de Castro Jr.

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[ANALYSIS] Will there be a new golden age in Philippine cinema after record-breaking MMFF?

Alejandro Edoria/Rappler

Local film producers and the national government have committed to work together to address issues that hamper the growth of the Philippine movie industry: high taxes, piracy, and red tape

MANILA, Philippines – After a box-office-record-setting 2023 Metro Manila Film Festival (MMFF), will we now now see Philippine cinemas often filled with movie-goers watching local movies instead of empty seats? 

It’s possible, now that the formula for a successful movie – a good story, word of mouth, creative marketing, and industry support – is clear. 

As Noel Ferrer, spokesman for the MMFF, said in a press conference on January 9: “Ibig sabihin, may pera ‘yung mga tao, they waited for word of mouth…. So, they want better stories, better quality films.” 

(This means people have money for movies but they waited for word of mouth. So, they want better stories, better quality films.) 

Is there a new Filipino cinema audience?

Is there a new Filipino cinema audience?

But it’s not likely to happen, if we take a closer look at the MMFF ticket sales as well as the persistent problems facing the local movie industry. 

Although the MMFF’s 49th edition earned P1.069 billion as of January 7, with expected total gross receipts of P1.2 billion, a closer look shows that one movie – Rewind – cornered over 80% of the ticket sales with its P845 million gross as of January 17. The three other films that did well were GMA Pictures and GMA Current Affairs’ Firefly, Jesuit Communications’ historical film GomBurZa, and Mentorque Productions’ Mallari (distributed by Warner Bros. Philippines). MMFF chair Don Artes said in the January 9 press conference that most of the MMFF films’ earnings were in the “eight digits.” (Rewind had nine digits.)

With the exception of the MMFF, where movies are shown when people have more money in their pockets and there’s no competition from Hollywood, producing a feature film is a very risky investment, with little chance in striking gold. 

As long-time movie producer Joji Alonzo said in a press conference on Thursday, January 18, prior to the MMFF, most local movies shown in 2023 had ticket sales of only between P2 million to P12 million, as she lamented the high cost of producing films. 

Bihirang bihira ang kumikita ng P100 million,” she said. (It’s very rare that a movie will earn P100 million.)

Assuming an average ticket price of P300, a movie with ticket sales of P2 million means that only 6,667 watched the film, while a movie with sales of P12 million means only 40,000 saw the movie. That’s a very small patronage given a total population of over 110 million. Cinema owners often change the movie being shown if they see very few people watching it.  

“Masuwerte lang ang MMFF, naramdaman na natin na bumabalik ulit ang mga tao sa sinehan para manood ulit ng pelikula,” Alonzo said. (The MMFF was just lucky, we got to see people returning to watching movies in the cinema.)

“But one of the hardest-hit industries is the film industry because of the pandemic. Not only did people shy away from the cinemas, the production cost went up 35%,” she added. 

How are ticket sales divided?

Alonzo also explained that revenues from ticket sales do not go only to the producer, but is split with national and local governments, cinema owner, and film distributor. 

For a film that earns P100 million, 10% or P10 million goes to the LGU for the amusement tax. From the P90 million, 45% or P45 million goes to the cinema owner. The balance of P45 million goes to the producer, who deducts the 12% value-added tax (VAT) and the distributor’s (assuming there is one) fee of between 5% to 20%. Film producers are thus asking for more support from the government as they try to revive the Philippine movie industry. 

“It’s not easy making a film. It [usually] taxes six months, so many people are involved. It’s a team, there are so many workers…if we don’t love our industry, what will happen?” Roselle Monteverde, chair of the Movie Producers Guild of the Philippines, said in the press conference on Thursday.

GMA Pictures president Annette Gozon-Valdes said this support is essential if the Philippines is to effectively compete with the rest of the world.

“Kung kunyari, may [10% amusement] tax holiday nga na ganito, baka pwedeng taasan pa ‘yung budget ng paggawa ng pelikula para mapaganda kasi siyempre, kailangan lumaban din tayo sa mga produkto ng ibang bansa,” Valdes told GMA-7 last week. “Dream natin na para tayong Korea, ‘di ba, pero we can’t do that without the support of government.”

(If, for example, there’s this [10% amusement] tax holiday, we [producers] may be able to increase the movie’s budget, make it better, because we have to compete with the products of other countries. We dream of being like Korea, but we can’t do that without the support of government.)

In South Korea, local films take more than half of local box offices. South Korea has also been able to globalize its film industry and was the fifth largest in the world in 2018 next to North America, China, Japan, and the United Kingdom. According to Korea.net, a government website, the value of cinema in South Korea was $1.6 billion in 2018 out of a global film market of $41.1 billion.

Government support

Even though it may still be too early to see a new golden age in Philippine cinema, at least, the local movie industry has been revitalized, and a new collective endeavor is being undertaken taking off from the 49th edition of the MMFF. 

The Philippines’ major film producers, backed by Film Development Council of the Philippines (FDCP) president Tirso Cruz III, met on Thursday, January 18, with Interior Secretary Benjamin Abalos III to discuss key problems in the movie industry, such as taxation, piracy, and red tape. 

Abalos committed to help convince the country’s local officials to adopt a moratorium on the 10% amusement tax on Philippine movies. For every movie ticket that now costs around P300 to P400, 10% (P30 to P40) goes to the LGU where the cinema is located. 

Since the 10% amusement tax is provided under the Local Government Code, Abalos said what he can do is to appeal to local officials to help the movie industry. 

The moratorium will only apply to local films, so foreign films will still be slapped with a 10% amusement tax. 

Abalos said local films now make up roughly 30% of what cinemas show a year, the rest are foreign films, so the moratorium’s impact on the amusement tax will not be that hard. 

To get the ball rolling, Abalos said his father, Mandaluyong Mayor Benjamin Abalos, has agreed to have a moratorium on the 10% amusement tax on local films. 

Piracy, ease of doing business

Abalos, who is also interior secretary, also committed to do more to fight piracy, which has been a bane of the film industry for decades. 

Former FDCP chair Liza Diño-Seguerra said in a speech in 2021 that the Philippine film industry contributed at least P11 billion to the economy, “and studies show that revenues can increase by at least 15% if only piracy is curbed.” 

She said that in 2016, Filipinos visited piracy websites over 22 million times, four million times more than the 18 million visits to the top 3 legal websites for films and television programs. 

MMFF’s Artes lamented that it’s so easy to record a film in cinemas nowadays, and he urged the public to report to security guards if they see someone recording the movie. 

“We are coordinating with authorities so that the illegally-streamed films will be taken down immediately,” said Artes, following reports that the highest grossing film, Rewind, is being illegally streamed and distributed online. 

Artes said they will seek the help of the National Bureau of Investigation, as well as Facebook and other digital media companies in clamping down on pirated sites. 

Abalos said he will also discuss with local officials ways on improving film producers’ ease of doing business.

He said producers have to secure permits from so many barangays which have different fees when shooting films.

We talked about the shootings, the barangay permit, iba’t iba ang presyo. Baka puwede pag-aralan lahat ito (they have different fees. Perhaps, we can all study this),” Abalos said. 

“Now, we have a good working relationship. Iisa-isahin namin ang problem (We will tackle the problems one by one). We will meet again every month, ang importante ‘yung (what’s important is the) output,” he said. 

Artes urged the FDCP to give more support to local movies, citing the P500,000 given to each 2023 MMFF entry for promotions.

Prospects for 2024

Although it’s hard to tell if we will have a new golden age, similar to the early years of Philippine cinema, it will definitely be a busy year for the industry. 

For one, the MMFF is going to have its first international festival, the Manila International Film Festival (MIFF), in Los Angeles, California, from January 29 to February 2. 

MIFF consultant Winston Emano said it’s a new opportunity for Hollywood to take notice of Philippine films. 

“We at the MIFF intend to continue the wonderful momentum that was built up by MMFF, with the similar goal of uplifting and giving a bigger spotlight to Filipino cinema worldwide,” Emano said in a press conference on January 9.

Aside from the film festival, there will also be dialogues and symposia where Filipino celebrities, filmmakers, scriptwriters, and American film industry representatives are expected to attend. An MIFF awards night will also be held. 

“There will be an exchange of ideas and knowledge sharing. We hope to bridge the gap and connect the Philippine entertainment industry with that of Hollywood and the international stage,” Artes said. 

In the run up to the 50th edition of the MMFF this year, Artes said there will also be a “Cine 50” where the top 50 MMFF films in the last 49 years of the festival will be shown in select theaters for only P50. 

There will also be a caravan of students’ short films.

According to a chapter on Philippine film in the Cultural Center of the Philippines Encyclopedia of Philippine Art written by the late Nestor Torre, there have been three golden ages in the local scene:

  • 1930s to 1940s, the first golden age when “Filipino filmmaking style began to emerge” but was cut short by World War 2
  • 1950s to 1960s, the second golden age when the “studio system” led by four major studios – Sampaguita, LVN, Premiere, and Lebran – dominated film production
  • 1960s to 1970s, the third golden age when film artists such as Eddie Romero, Lino Brocka, Ishmael Bernal, Celso Ad Castillo, Marilou Diaz-Abaya, Laurice Guillen, Mike de Leon, and Peque Gallaga produced “quality films” despite commercialization in the movie industry.

It was all downhill starting in the eighties as piracy, censorship, and the rise of streaming platforms severely impacted the local movie industry. – Rappler.com

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Isagani de Castro Jr.

Before he joined Rappler as senior desk editor, Isagani de Castro Jr. was longest-serving editor in chief of ABS-CBN News online. He had reported for the investigative magazine Newsbreak, Asahi Shimbun Manila, and Business Day. He has written chapters for books on politics, international relations, and civil society.