Foxtel warns shows like ‘Wentworth’ are at risk of being axed if they reach the 65-episode eligibility cap for the Producer Offset. 

Foxtel has proposed stripping away Screen Australia’s funding for drama and documentary and using the money to cover the costs of raising the Location and TV Producer Offsets.

In a submission to the Australian and Children’s Screen Content Review that won’t be well received by Screen Australia’s board and executives, the pay TV platform argued the move would address the difficulties the agency faces in assessing the likely success and comparative merits of productions and in determining which projects are eligible for limited public funds.

That would also reduce application and acquittal costs for broadcasters and producers and make access to government support more market-based, which, it says, “is more sustainable in the long term.”

As a concession to Screen Australia, Foxtel proposed that a portion of public funds be retained for script and talent development, innovation and new media, observing, “These are areas where the model of direct funding makes more sense and can have a more direct and efficient impact.”

To advance its own interests, Foxtel urged the Screen Australia-mandated minimum licence fee of $440,000 per hour for Australian drama should give broadcasters the rights to distribute programs across numerous platforms.

“A high licence fee does not make sense for subscription platforms where individual channels and services generally attract lower audiences than commercial FTA broadcasting services,” it said.

“Greater flexibility is needed in this area to incentivise ongoing investment in new productions and to encourage innovation and the development of lower cost, more agile production models.

“The exclusion of digital rights from the broadcaster licence fee does not reflect the modern media environment in which content providers (such as subscription TV) reach their viewers by a number of means.”

Foxtel supported calls by Free TV Australia to remove the 65-episodes cap on series that are eligible for the Producer Offset and for production companies owned by broadcasters to have access to Screen Australia funding.

“The justification for treating ‘in-house’ production differently from ‘independent’ production is difficult to substantiate in an environment in which the independent sector is dominated by large foreign-owned production businesses,” it said.

“In addition, the source of programming makes no difference to the audience, who benefit from seeing local stories regardless of how the production was undertaken. It also matters little to the cast and crew of a production, who stand to gain the same employment and development opportunities whether a production was ‘in-house’ or ‘independent’.”

It warned that Foxtel-commissioned dramas such as FremantleMedia Australia’s Wentworth and Seven Productions’ A Place to Call Home may be at risk of being axed once the 65 episode threshold is reached “because the economics of making them is drastically altered.”

Stressing its commitment to local productions, Foxtel pointed to dramas including The Kettering Incident, Secret City and 2018 titles Picnic at Hanging Rock and The Fighting Season.

In the factual realm Foxtel has commissioned programmes such as The Archibald, Court Justice, Sydney and Lawless, The Real Bushrangers. Among popular lifestyle and reality genres shows are Selling Houses Australia, Gogglebox, River Cottage Australia and Australia’s Next Top Model.

The submission quotes economic analysis from PwC which found that 360 new television jobs and $103.9 million in economic activity would be created if the offset for qualifying TV productions were doubled to 40 per cent.

That measure would cost the Federal Government $15.5 million but would generate an additional $119.4 million in economic activity, making the overall economy better off by more than $100 million.

Foxtel also declared its opposition to the introduction of an hours or revenue-based local content quota on streaming services such as Netflix. Instead it suggested these content providers should be able to access the enhanced range of tax offsets.

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