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Th M di andd Entertainment
E t t i t Industry
I d t in i NYC:
NYC
Trends and Recommendations for the Future
October, 2015
Introduction
The media and entertainment industry is an important contributor to New York City’s economy,
providing high quality jobs which out-performed
out performed the US economy through the financial
downturn.
Since our last report in 2012 the industry in New York City has seen a period of steady growth,
particularly in sub sectors like scripted TV series which offer long-term and predictable
employment.
This report, completed in April 2015, serves as an update to our 2012 publication. The report analyzes
TV is a standout success story, with 14.8% annualized FTE growth and 17.0% annualized spending increase
• Widespread adoption of new TV viewing platforms has intensified competition for TV audiences
• More networks now commissioning original TV content, including pre-existing cable networks (Bravo, Starz, AMC)
as well
e as new
e o online
epplayers
aye s ((Netflix,
e , Hulu,
u u, Amazon)
a o )
• New series typically 8-12 episodes (vs. traditional 20+ for broadcast), with increasing turnover of shows – proactive
Movie production in NYC much more variable, as a result of dollars being concentrated in 'tentpole1' films
the US2 , causing
1. A "tentpole" production is a movie or television show that supports the financial performance of a movie studio or television network 2. e.g., looking at the top 100 grossing movies each year '11-
'14 vs. '01-'04 , we see a 16% decline in the total number of movies released by the major studios and their subsidiaries, with a 33% decline in movies with budgets <100m
Media and Entertainment in NYC-Final.pptx 3
Executive summary (II)
NYC is one of only three cities in the world (along with LA, London) with a filming community large enough to
enable a production to be made without needing any roles to be brought in from outside – cast, ATL or BTL1
• IIn addition
dditi tot mainstream
i t productions,
d ti NYC also
l home
h to
t a thriving
th i i iindie
di movie
i scene, and
d th
the llargestt
concentration of documentary production in the US
Other
Fil and
Film d TV t diti
traditional
l media
di N
New media
di O t f
Out-of-scope
Filmed Music
Advertising/PR Digital
entertainment
Includes commercials, TV Includes agencies Includes digital media and Live events
shows and films. News (advertising, media buying, entertainment companies, • Concerts
included under public relations, promotion, social media, and internet
broadcasting and cable digital and direct publishing, both
• Sports
marketing)g) p
established and start-ups
Associated
Broadcasting
Key changes since 2012 report: Inclusion of tourism and theatre. Refocusing of digital section on media and entertainment only
1. Based on survey of TV show taping attendees. Includes only tourists citing taping as deciding or important reason to visit NYC. 2. Economic impact as estimated by The Broadway League.
Media and Entertainment in NYC-Final.pptx 5
Agenda
1 The TV and movie industry
• Economic impact in NYC
• Television:
– National trends
– Productions in NYC
– NYC tourism
• Movies:
– National trends
– Productions in NYC
Talent
St
Story Lead actor/director
NYC often explicitly based in NYC, prefer to
featured in stories: film locally, e.g.:
• Iconic US urban • Madam Secretary
environment, skyline • The Good Wife
• Rich real-life history • The Blacklist
• A 'walking city', lends itself • Unbreakable
to coincidence, storytelling Kimmyy Schmidt
• Center
C t off literature,
lit t
Content & channel "There's a drive for content because of the cable
fragmentation
g and internet platforms that didn't
didn t exist before
before"
• TV studio executive
Timeline of original
g scripted
p content creation (nationwide,
( with illustrative show titles))
Daredevil
Girlfriend’s
Bravo
Odd Mom
1 Out
CINEMAX
1 Hunted Banshee
From Steven Soderbergh
The Knick
Pre-exxisting cable n
Tvland Hot In
Cleveland
Happily
Divorced Kirstie Younger
Laugh More
'TV
TV Guide
Guide' highly
highly-anticipated
anticipated debut shows in 2009 and 2014
- National, not specific to NYC productions
2009 2014
The
Accidentally Flash 'Black.Ish abc Cristela abc The Flash Gracepoint NBC
On Purpose
CBS Cleveland FOX Community NBC
forward
abc
Show
Cougar Melrose FOX THE CW The Mysteries
Full-length The
Forgotten
abc Town
abc Thegoodwife CBS Place
THE CW Forever abc Gotham
Of Laura
Note: Full-length season is defined as 18 episodes or more; short-run seasons are fewer than 18 episodes.
Source: TV Guide 2009 and 2014 Fall TV Previews.
Media and Entertainment in NYC-Final.pptx 12
1
40 MTV
Blue Bloods 15 Tvland
CINEMAX
A rights reserved.
VH1 Bravo
Thegoodwife 10 COMEDY COMEDY COMEDY
CENTRAL CENTRAL CENTRAL
# scripted
11 12 11 17 15 18 23 20 21 24 27 29 46 # networks: 2 3 3 7 10 12 19
shows:
Note: Full-length season is defined as 18 episodes or more; short-run seasons are fewer than 18 episodes. Shows listed on left-hand-side graph are illustrative only.
Source: MOME permit data.
Media and Entertainment in NYC-Final.pptx 13
1
NYC TV production FTEs and spending has increased
substantially since 2002, accelerating since 2010
Both scripted and
unscripted TV have seen FTE (full ... with similar increases in total
time equivalent) employment grow... production spending
Annual Annual
T t l NYC FTEs
Total FTE (K) growth T t l NYC spend
Total d ($M) 17.0% growth
40 '11-'14 '11-'14
5,000 4,696
14.8%
10 15.6% 17.8%
1,000
Scripted
Source: MOME permitting and city incentive application data; BCG Filmed Entertainment model. Spending estimates include 2-3% annual inflation.
Media and Entertainment in NYC-Final.pptx 14
1
Increase in TV production has provided opportunity for
crews to work year-round
year round by combining projects
TV p
production once highly
g y seasonal – now a y
year-round jjob for many
y
Jan Orange Is Jan Allegiance
The New
2000 2014 Black
Power
Oct April Alpha
Law & Order
Special
p Victims Unit House
Law & Order Oct April
Third Watch July
Film/TV Outside work / More 8-12 episode shows (e.g. Power, Girls – 10 eps. each),
vacation departure from established TV season allow crew to combine
TV show examples are illustrative only. projects into year-round employment
TV show 'churn' increasing: Higher Almost all shows stay in pilot city; NYC
turnover results in more pilots each yr is second only to LA, but room to grow
% from outside NY metro varies Most "show tourists"1 are daytrippers from
significantly across shows surveyed region, but some do travel from rest of US
% by area of origin % of total audience
100 80
NY metro Show not a deciding reason for visit to NYC
Within region "Show tourists": Show was important or deciding
80 (NYS/NJ/CT/PA) reason to visit NYC
Other US 60
International
60
1. "Show tourists" are tourists who indicated that their trip is entirely or mainly for the purpose of seeing the live taping. Today, Tonight, Letterman, SNL results weighted to reflect total mix of
shows taping in NYC, based on genre and ticketing policy (how far in advance tickets are issued, whether admission is guaranteed, etc.).
Note: SNL includes dress rehearsal and live show.
Media and Entertainment in NYC-Final.pptx 17
1
Total budget dollars ($B), for top 100 grossing movies per year, Concentration of movies in
2001-2004 vs. 2011-2014
Remake 'known concepts' already
15 Sequel underway a decade ago
First time in a movie • Harry Potter, Lord of the Rings
series both released from 2001
10 10
10 9 • Resulted in large share of
8 production dollars in 'hit books'
Total NYC FTEs (K) Production related jobs include all direct
+14%
supporting functions for film production
40
37 37 • E.g. equipment rental, transportation,
35
35 33
construction, costumes, laundry, direct food
29 30
31 service, etc., often provided by small
30 28 28
2
27 businesses
businesses.
26 25
Note: Production-related employment estimated by MPAA. Since not direct employment, excluded from BCG RIMS analysis.
Source: Production related jobs calculated based on MPAA methodology for NYS, conservatively estimating that NYC's share of state production-related jobs matches its share of direct state
production jobs.
Media and Entertainment in NYC-Final.pptx 22
1
In addition to 104K direct production and production-
related FTEs, filming supports ~20K
20K NYC jobs indirectly
After a production spends money in NYC, that money continues to ripple through NYC's
NYC s
economy – creating more economic activity and FTEs (full time equivalent jobs)
~$8.7B spent on NYC NYC vendors, crew in turn spend money on food, ...generating additional
d ti
productions i 2014
in rent products (some in-city,
rent, in city some outside) – l
employment t in
i NYC
$$ circulates through NYC economy...
1. FTEs calculated using RIMS II Type I jobs multiplier (jobs-for-jobs), counting only direct employment (excl. production-related employment) and film ATL.
Note: Type I RIMS II multipliers used, as wages likely inflexible in short-term due to union contracts. Detailed industry multipliers compiled using 2002 Benchmark Input/Output Table and 2010
regional data (most recent detailed industry multipliers available from BEA).
Source: Bureau of Economic Analysis (Dept. of Commerce), RIMS division.
Media and Entertainment in NYC-Final.pptx 23
1
Film schools: High quality training "Indie movie industry... used as 'farm team' by major
studios, to test out talent"
–Indie
Indie post production executive
"Everything an indie film needs is here in NYC"
–Multiple interviewees
Number of nominations received by production companies headquartered in each city, for feature-length
documentaries, at a selection of top-tier US award ceremonies, '11-'14: Academy Awards, Tribeca, Sundance, AFI docs1
B
B Europe
A
Sweden 3 1 Finland
Netherlands 8 Denmark
9 1 Lithuania
C UK 24 1 Poland
5
2 Germany
Belgium 11
1 Serbia
10 Unknown France 1 Georgia
Manhattan/ 2 Switzerland
A
US Brooklyn 3 Israel
S. Portland 1 Qatar
Canada 4 1
FTEs still declining 2011 to 2014, but ... as digital revenues offset
less sharply than in 2002 to 2010... contraction of print sales and ads
NYC FTEs (K) NYC revenues ($B) Persistent challenges for industry with shift
80 55 Annual away from print sales and traditional
50
growth advertising
70
-2.0%
45
'11-'14 • Advertisers, readers shift to digital, mobile –
-0.4%
60 though print players remain most trusted
55 53 54 54 55 56 56 40
51 providers of content, even in digital space
50 48 35
46 47 46 45 • Newspaper revenues have recovered
Ad FTEs (full time equivalent jobs) have ...As agencies evolve their
grown despite lower traditional ad spend offering toward digital, mobile
NYC FTEs (K) NYC revenues ($B) Strong growth in digital has offset flat or
80 22 Annual slightly declining market for print, TV ads
5.3% growth
20
70 '11-'14
62 64 18 US ad industry expected to remain strongly
2.3%
60 59 concentrated in NYC
54 55 16 3.8%
49
51 51 51 • Most new specialist digital agencies arising
50 47 14
44 44 45 1.9% in New York vs. Silicon Valley
Other
LA
NY 60
NYC's
NYC s digital and technology landscape TACODA
Mayor releases
NYC creates NYC Digital MEDIA
NYC MediaNYC City-funding of first ever roadmap and Technion CENTRE
support 2020 initiatives start-up 'Chief Digital announces
announced incubators Cornell University
Officer' $100M ggrant for Opening of the Made in
position Applied Sciences Cornell and
NY Media Center by IFP,
Research Technion
in Brooklyn
Campus selected
Source: Gridley's Guide to Digital NY, CB Insights, CapIQ, AGC Partners, MOME
Media and Entertainment in NYC-Final.pptx 33
3
Influx of startup funding and continued growth of big tech
have fueled expansion of digital media & entertainment in NYC
Source: Digital.NYC, BLS, Gridley report, SNL Kagan and BCG analysis
Media and Entertainment in NYC-Final.pptx 34
Key chapters of 2015 report
1 The TV and movie industry
• Economic impact in NYC
• Television:
– National trends
– Productions in NYC
– NYC tourism
• Movies:
– National trends
– Productions in NYC
US media sector has created ~50k Subsector shift has helped NYC
jobs; ~25k (50%) in NYC ('11-'14) overcome nationwide decline
Nationwide, media sector has shed jobs,
% NYC NYC job while NYC continues to hire
jjobs/total
b /t t l US 2002 2011 2014 l growth
th • NYC has gained share of US jobs across all
jobs2 since '11
sub-sectors
Filmed ent. 11.2% 12.2% 14.0% 21%
Strong growth in TV generates consistent
Advertising 12.4% 13.0% 17.4% 15% strength in filmed entertainment, despite
1. Using BLS data; BCG filmed entertainment model (using 2009 estimates – little change since) and focusing on refreshing extant views of data.
2. Digital media and entertainment not included here, as national figures not available
Media and Entertainment in NYC-Final.pptx 37
4
NYC Media and entertainment growth outperformed US
economy, overall NYC economy through the financial crisis
NYC media sector outperformed NYC ... losing fewer jobs in the downturn
and US economies through the crisis... and growing more rapidly in recovery
FTEs (2002=100)
140
J b lost
Jobs l t J b growth
Job th
Digital media, filmed entertainment
'08-'09 '11-'14
(led by TV) growing even faster
120 NYC media/ -3% 10%
entertainment 10 000 FTE lost
10,000 25 000 FTE
25,000
A rights reserved.
100 Total NYC -3% 5%
economy 110,000 FTE lost 180,000 FTE
Source: BLS (unemployment rate, and employment numbers from QCEW – both for NYC only); BCG filmed entertainment model for filmed entertainment employment (within M&E).
Studios
St di and d networks
t k increasingly
i i l taking
t ki fewer,
f larger
l bets
b t on 'tentpole'
't t l '
Gaining entry
Diversity relies on creating pathways to union membership
to unions
Women and • MOME supporting Brooklyn College Film School, recruiting a diverse student base
• "Made In New York" Production Assistant Training Program
minority education
• Outreach to school, college students, to make them aware of career options they may not have
and awareness
• R
Revenues growing,
i audience
di • C
Continuing
ti i tto b
benefit
fit ffrom
Theater expanding, thanks to strong industry and the tourism
new/varied content it draws
• IIndustry
d t evolving
l i with
ith • Shift iin NYC
NYC-based
b d corporate
t
Broadcast
Positive trend
Emerging opportunity Challenge to NYC
Positive trend
Emerging opportunity Challenge to NYC
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