The overall health of Canadian film and TV production last year was perhaps even worse than expected, with the feature film and drama series formats taking particularly hard hits. The silver lining is that TV movies, docs and live-action children’s programming showed signs of growth, and as media giants fade from the production scene, several mid-sized prodcos seem to be taking advantage.

Spending on film and TV production and development was down 18% in 2004, dropping to $1.24 billion from $1.51 billion in 2003, according to Playback’s 17th Annual Report on Independent Production (see chart, p. 20). It is the lowest total since 1996 and the biggest year-over-year drop in what has become a four-year slide, with the previous two cycles having experienced decreases of 8% and 7%, respectively.

Playback figures show Canadian production and development spending on the rise throughout the mid-1990s, peaking in 2000 at $1.83 billion, but declining ever since. It remains to be seen whether a leaner, meaner Canadian industry can right the ship.

‘It shows how fragile the sector is,’ says Guy Mayson, president and CEO of the CFTPA. ‘We got used to it growing rapidly, and we’d like to make sure it continues to grow.’

Profile 2005, the report released earlier this year by the CFTPA and APFTQ, showed $1.98 billion spent on CAVCO- and non-CAVCO certified production for the period of April 1, 2003 to March 31, 2004, a year-over-year decline of 7%. Mayson points to weak demand for non-domestic fare in foreign markets over the past few years as the main cause, although he notes some renewed optimism coming out of MIPTV.

All the ballyhoo about the decline of Canadian drama series is justified by the figures, which show the amount spent on the format down 33% to $377.6 million. Even the federal government’s move to restore its $100-million-per-year commitment to the Canadian Television Fund last March was not enough to stop the bleeding. And the Liberals, currently grasping on to power, have not announced their intentions for the CTF beyond this year.

Staples such as Cold Squad and Blue Murder disappeared from the scene last year, but it would be premature to call domestic drama series dead just yet.

‘A lot of different broadcasters are getting more involved in drama – specialties, in some cases, and conventionals such as CHUM are doing more,’ Mayson says. ‘It’s encouraging in some ways, but [drama] is still woefully under-funded and there does need to be a major commitment to ensuring that there is a critical mass of drama out there.’

Spending on feature films was even worse in 2004, down 49% to $150 million. One major reason was that 2004 was a development year for several prodcos that had been active in production in the previous cycle. Some, such as Montreal’s Remstar Productions, which says it will have about $35 million in production to report for 2005, did not submit their numbers for this reason. Others, such as Toronto’s Knightscove Family Films, did disclose its 2004 development spending ($350,000) but had no production in the cycle (compared to more than $26 million worth in 2003).

Other companies not in production cycles last year – and hurting the bottom line for features – include Keystone Pictures, Visual Bible International and Copper Heart Entertainment. Development spending across all formats and genres was down only slightly to $25.8 million.

Also adversely affecting the domestic feature biz is the decline in copros with the U.K., traditionally Canada’s biggest feature partner, after the government there tightened rules governing official copros.

The move out of film production by Alliance Atlantis and Lions Gate also contributed to the decline in feature spending, as did the fact that Vancouver’s Brightlight Pictures did $10 million less in proprietary production (but $52 million, or $28 million more, in service production).

Several other companies had a big year for service work, most notably Montreal’s Muse Entertainment ($77 million, up 28%).

Also on the positive side, spending in the TV drama category of MOWs/ pilots/miniseries and shorts was up 19% to $213 million. The international demand for MOWs was strong several years ago (with $276 million spent in 2000), but soon dropped, burning several prodcos that made the format their bread and butter. But the market for TV movies, especially in the U.S., appears to still have a pulse. In fact, some companies have grown on MOWs.

Calgary’s Voice Pictures, a big mover on this year’s list, soaring from seventeenth to fourth spot, reported $50.1 million in production and development in 2004 (up 110%) on the strength of TV movie copros with American partners. Titles include three well-received installments of Little House on the Prairie (with Touchstone), Karroll’s Christmas (with Fox), and two western MOWs for the Into the West series (with Turner and distrib DreamWorks).

‘In the U.S., there’s a huge demand for movies of the week,’ says Wendy Hill-Tout, Voice president. ‘The licences have gone down, but they’re still making lots of them. We just look at the international marketplace to decide what to go with.’

Voice benefited last year not only from Alberta’s geography – ideal for its western-themed projects – but also from the Alberta Film Development Corporation’s strategy of offering financial incentives to foreign producers that partner with a local prodco.

There was a 23% jump in documentary production to $132 million in 2004, as broadcasters and distributors become increasingly aware of the potential payoff for this type of programming – far cheaper to produce than drama – on both the big and small screens. A number of new small and mid-sized players added to the bottom line of doc production in 2004, while existing players such as Partners in Motion, Breakthrough Films & Television and Summerhill Entertainment reported increased spending.

‘It shows the commitment from the specialties, especially, to play in that area and work with the independent sector,’ notes Mayson.

Even more impressive is 67% growth in live-action children’s programming (up to $81 million). The jump is attributable primarily to prodcos making recent moves into – or back into – this genre, including Alberta Filmworks (Shoebox Zoo, which it copros with CBBC Scotland and Blueprint Entertainment) and Shaftesbury Films (Dark Oracle, a copro with Cookie Jar Entertainment, and Life with Derek with Pope Productions).

Toronto’s Shaftesbury, which firmly adheres to a diversified slate, brought in Suzanne French, formerly of Alliance Atlantis’ children’s division, to ramp up the prodco’s involvement on the kids side a couple of years ago. It is part of the reason Shaftesbury jumped to eleventh on the list from twenty-third, with $32 million in overall volume (an increase of 69%).

‘There is still a very healthy appetite for live-action kids series in the world,’ says Christina Jennings, Shaftesbury chair and founder. She adds that the key is to have 26 episodes for prospective international buyers.

‘[Cookie Jar] was selling Dark Oracle as a 13-ep series and people were going, ‘Why don’t you come back to us when you’ve got the next 13?” she says. ‘So, at MIPTV, we were able to say we are going to do Dark Oracle [for another 13-ep season], and that helped Cookie Jar.’

In what was a volatile year, the production genres that remained most steady were comedy/variety (down 1% to $47.4 million) and animation (down 8% to $157.1 million).

The volume of magazine/ lifestyle/reality programming handled by indie producers was down 25% in 2004 to $55 million, as broadcasters bring much of this type of production in-house.

Perennial chart-topper Alliance Atlantis remains number one on the list with $146 million in production, although it has by now exited from direct production of Canadian movies and shows. The bulk of its spending in 2004 was on its financial stake in the blockbuster CBS CSI series franchise, including the original CSI: Crime Scene Investigation, CSI: Miami and CSI: NY, which began production last year. Overall, AAC’s 2004 numbers are down 22% from 2003.

Another major, Lions Gate Entertainment, which divides its offices between Canada and the U.S., moves up to second spot, having spent $68.6 million on the Canadian-shot series Missing and Dead Zone and the MOW Widow on the Hill for U.S. networks. As the company looks to focus on its American distribution business, its production spending was down 32%.

Lions Gate takes over second spot with the disappearance of Fireworks Entertainment, formerly a perennial inhabitant of the list’s elite rung. Fireworks, owned by CanWest Global, has moved out of production, after spending an estimated $110 million in 2003, and its absence takes a hefty bite out of the overall totals. Late last month, CanWest announced that it had reached an agreement to sell its Fireworks library to ContentFilm International.

Nelvana, the subsidiary of media giant Corus Entertainment, lands in third place, up one spot, with $57 million in production and development spending, a decrease of 6%. Its slate of animated projects in 2004 included the series Miss Spider’s Sunny Patch Friends and Braceface.

Playback obtained statistics on prodcos’ spending by genre in calendar 2004 from the companies themselves. One hundred and sixty-seven prodcos participated in this year’s survey, compared to 176 last year. For some companies that did not submit numbers, Playback has entered an estimate.