Latest / Bennett Thrasher Presents: Beyond The Ledger / The Business Behind Hollywood: Tom Luse on Georgia Film Tax Incentives, Investment & the Future of Entertainment

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The Business Behind Hollywood: Tom Luse on Georgia Film Tax Incentives, Investment & the Future of Entertainment · Bennett Thrasher Presents: Beyond The Ledger

• 0:09
  SPEAKER_00: Welcome to Beyond the Ledger.
• 0:10
  SPEAKER_00: I'm your host, Shard Ay Lakfield.
• 0:12
  SPEAKER_00: Today's episode is part of the Growth Exchange, our special series featuring entrepreneurs, innovators, and industry leaders shaping the future of business and beyond.
• 0:31
  SPEAKER_00: Joining Peter is Tom Luth, an accomplished producer and executive producer with more than four decades of experience across film and television.
• 0:40
  SPEAKER_00: From The Walking Dead and Remember the Titans to Drumline and One Tree Hill.
• 0:44
  SPEAKER_00: Tom has built a remarkable career while playing a role in the industry's evolution and Georgia's rise as a global production.
• 0:53
  SPEAKER_00: Today, Peter and Tom explore Georgia's evolution into a major film and television production.
• 0:59
  SPEAKER_00: The role of tax incentives in production financing, and the challenges and opportunities shaping what comes next, including why the future of content creation will depend on more than talent and storytelling, but also strategic investment, innovation, and connecting creators, capital, and opportunity.
• 1:17
  SPEAKER_00: Now I'll hand it over to Peter.
• 1:19
  SPEAKER_05: Hey everybody.
• 1:30
  SPEAKER_01: Well, thanks, Peter.
• 1:31
  SPEAKER_01: I'm looking forward to this conversation.
• 1:33
  SPEAKER_01: Like wow.
• 1:34
  SPEAKER_01: You and I have had a lot of conversations over the years about the business, and your perspective from both a legal and a financial perspective is one that I think is uh invaluable to our state.
• 1:46
  SPEAKER_01: So it should be fun.
• 1:47
  SPEAKER_01: I went to Georgia State University, I went to Champlain High School like you did.
• 1:51
  SPEAKER_01: That's right.
• 1:51
  SPEAKER_01: Bulldog.
• 1:52
  SPEAKER_01: Uh I went there when it was a little different than when you went there.
• 1:55
  SPEAKER_01: Uh and then I went to Georgia State for both my undergraduate and graduate degree.
• 1:59
  SPEAKER_01: And I changed over when I was in grad school to a program that ended up letting me do my master's thesis as a film.
• 2:07
  SPEAKER_01: I think I was the first person in Georgia to do a film as a master's thesis.
• 2:12
  SPEAKER_01: And then I used that as an entree.
• 2:15
  SPEAKER_01: Won a couple of awards.
• 2:16
  SPEAKER_01: They got an AFI director's internship uh for me as well.
• 2:20
  SPEAKER_01: And so I started to kind of work up mainly in commercials to begin with, worked in the different all the different departments.
• 2:27
  SPEAKER_01: Started working on features as a PA and then as a location manager on a movie called Murder in Queda County, which was with Johnny Cash and Andy Griffith in 1980 or 81, back in the day.
• 2:40
  SPEAKER_01: And uh and then I joined the DGA on Glory in 1988.
• 2:46
  SPEAKER_01: And um and then I just kept falling forward into movies like Drumline and Remember the Titans.
• 2:52
  SPEAKER_01: I did TV series like One Tree Hill and Profiler Everwood, I produced out in Utah, and then I did features uh that took me all over the world.
• 3:04
  SPEAKER_01: So I've had a pretty interesting career.
• 3:06
  SPEAKER_01: Came back here in 2009 to do a movie called The Joneses, and it was the first movie I think Tyler was doing one at the same time, using the new incentive, which was amazing.
• 3:18
  SPEAKER_01: And and I could just couldn't leave.
• 3:20
  SPEAKER_01: I got a lot of offers.
• 3:22
  SPEAKER_01: We ended up doing a series for Warner's called Past Life.
• 3:25
  SPEAKER_01: Oh, I worked on that one.
• 3:26
  SPEAKER_01: Yeah.
• 3:26
  SPEAKER_01: And which was so funny because Warners didn't want to shoot in Georgia.
• 3:30
  SPEAKER_01: Right.
• 3:30
  SPEAKER_01: And I talked them into it.
• 3:32
  SPEAKER_01: I showed them the numbers, I showed them what I did on the Joneses, and they liked what I showed them so much that they brought in a vampire diaries at the same time.
• 3:39
  SPEAKER_05: Yeah, that was great.
• 3:40
  SPEAKER_05: They were one of the heaviest first investors for this Georgia Film Text Credit.
• 3:44
  SPEAKER_05: And so, yeah, I was involved in that sense.
• 3:47
  SPEAKER_05: So let's bring it back to Georgia then.
• 3:49
  SPEAKER_05: Let's talk a little bit about the history of kind of Georgia production and where we are now and where we're going.
• 3:54
  SPEAKER_05: So obviously, the Film Text Credit, which I think the current version got passed in 2008, pretty pivotal.
• 4:01
  SPEAKER_05: We just talked about the fact that Warner Brothers was an early first investor, possibly because they had you here and also they had some affiliates, right?
• 4:08
  SPEAKER_05: They had uh CNN and TBS and some great shows, Vampire Diaries, Past Life, and a lot of features.
• 4:16
  SPEAKER_05: All of a sudden, from my perspective, Georgia went from zero to a hundred.
• 4:20
  SPEAKER_05: You know, we went from a couple hundred million in production investment to uh multi-billion dollar in investment.
• 4:26
  SPEAKER_05: What do you what do you think was the secret to Georgia's success?
• 4:30
  SPEAKER_01: You know, it really was the incentive.
• 4:32
  SPEAKER_01: Let's be clear.
• 4:33
  SPEAKER_01: That that incentive changed everything here.
• 4:36
  SPEAKER_01: Now, I came up in the business here.
• 4:38
  SPEAKER_01: So in the late 70s, there was like mainly just TV commercial producers.
• 4:43
  SPEAKER_01: There were a couple indie features.
• 4:45
  SPEAKER_01: There was a company called Tips that did things like the prize fighter with Don Knotts and uh Tim Conway.
• 4:51
  SPEAKER_01: So there was Wanda Dale, I think was the woman who was behind that at that time.
• 4:55
  SPEAKER_01: And so there was an occasional indie presence, I think we would say, but uh by and large, it was uh commercials.
• 5:02
  SPEAKER_01: And that's where I got my training as a crew member primarily.
• 5:07
  SPEAKER_01: And uh but then just when that was really starting to take off, features and TV movies especially started to really happen here.
• 5:14
  SPEAKER_01: And this is 1979, 1980, 1981.
• 5:18
  SPEAKER_01: There was out in Covington, there was Dukes of Hazard, and then later the Carol Connor version of On the Heat of the Night.
• 5:26
  SPEAKER_01: In the Heat of the Night.
• 5:27
  SPEAKER_01: And so On the Heat of the Night, they developed a lot of the young actors that later on took advantage of the kind of the first wave of production that really started to come in on mainly on TV movies.
• 5:37
  SPEAKER_01: People like Walt and Goggins were in the TV movies I worked on.
• 5:41
  SPEAKER_01: Ray McKinnon was on all of those movies, and then Walt and Ray started their own little production company.
• 5:48
  SPEAKER_01: And so it was an interesting time.
• 5:51
  SPEAKER_01: And there was some little nexus of things happening.
• 5:55
  SPEAKER_01: Towards the end of the 80s into the early 90s, things started to really change, and there was some union activity that caused it.
• 6:03
  SPEAKER_01: It was all pretty much non-union back then.
• 6:06
  SPEAKER_01: There was NABIT that did some things under the auspices of NABIT, some of the earlier TV movies.
• 6:13
  SPEAKER_01: But then there was some teamster activity and IA activity, and a lot of people thought that was the problem, but that wasn't the problem at all.
• 6:21
  SPEAKER_01: The real problem was Canada.
• 6:23
  SPEAKER_01: At that time, Canada started to target production, US production, for mainly for TV shows and TV movies, because they had both a federal and a provincial incentive.
• 6:36
  SPEAKER_01: So I actually ended up going to Canada and saw firsthand the advantages they had.
• 6:41
  SPEAKER_01: They had not just these incentives, which were lucrative, they also had national health and national pension.
• 6:48
  SPEAKER_01: The IA fringes were almost nothing.
• 6:50
  SPEAKER_01: The exchange rate was very attractive.
• 6:53
  SPEAKER_01: So for TV producers, it just was almost a no-brainer to start moving things up there.
• 7:01
  SPEAKER_01: The savings were were frankly remarkable.
• 7:04
  SPEAKER_01: You know, and we're talking about two-thirds the cost.
• 7:07
  SPEAKER_01: Wow.
• 7:08
  SPEAKER_01: Typically.
• 7:08
  SPEAKER_01: And that's you know, that that was very difficult to uh to compete with.
• 7:13
  SPEAKER_01: And so Georgia the production here really slowed down at that time.
• 7:18
  SPEAKER_01: And and it stayed kind of just slow.
• 7:22
  SPEAKER_01: You would have little bumps here and there, but in 2008, like you said, the new incentives passed, and studios are slow to adapt.
• 7:34
  SPEAKER_01: Like I said, on a show that I was doing called Past Life, which I did in the pilot in Baltimore.
• 7:40
  SPEAKER_01: I wanted to bring the series here, and Warner Brothers said, no, I wouldn't want to shoot in Georgia.
• 7:44
  SPEAKER_01: And I showed them that I had just done the year before, maybe the first movie under the incentives, a movie called The Joneses.
• 7:51
  SPEAKER_01: The numbers really worked well.
• 7:53
  SPEAKER_01: And they got pretty excited when I finally got through to them, so much so that they also brought Right on My Tails, which was very painful for me because now they I had another TV series competing for resources for crew and dolls, and they brought in vampire diaries, and they then spread to many other things as well.
• 8:11
  SPEAKER_01: So in those early days of the incentive, there were no studios, there were no vendors.
• 8:16
  SPEAKER_01: I talked to a guy at Evan Green at Pascal and convinced him to bring a depot here for grip electric equipment because there really was very little grip electric equipment.
• 8:26
  SPEAKER_01: The people at PCA, who had been longtime friends, really wanted to take care of their commercial people first, so we had very little infrastructure.
• 8:34
  SPEAKER_01: What was really interesting was once things started to roll, a lot of the crew, like me, I had moved to Utah for a while to do a series called uh Everone.
• 8:44
  SPEAKER_01: The crew came back.
• 8:45
  SPEAKER_01: And so the crew that was developed in the 80s and the 90s, that crew that had dispersed all over the world.
• 8:52
  SPEAKER_05: The people with a connection to Georgia were kind of the first ones back when the history started.
• 8:57
  SPEAKER_01: You know, we had amazing grips like Alan Rollins and Robert Kemp and all these people.
• 9:01
  SPEAKER_01: Robert stayed, but Alan and all of his team, they had gone.
• 9:04
  SPEAKER_01: And so these people came back, people like Lee Basking, a great camera assistant.
• 9:09
  SPEAKER_01: And then even more so, then DPs and costume designers started to come back.
• 9:15
  SPEAKER_01: First, people that were from here, and later other people now started to come as well.
• 9:20
  SPEAKER_01: Right.
• 9:20
  SPEAKER_01: Really a lot of people from North Carolina, because every sentence dropped.
• 9:24
  SPEAKER_05: I think Florida and North Carolina both got rid of their incentives right around the time that George ramped up in 2008.
• 9:30
  SPEAKER_05: Yeah, I think we we basically sucked up all the crews on the East Coast.
• 9:34
  SPEAKER_01: Yeah, we did really well.
• 9:35
  SPEAKER_01: And I had worked in both Florida, I'd done three projects, I did Jeepers Creepers down there, and I needed a couple other projects down there, and then I'd worked many times in North Carolina, so I knew those crews.
• 9:45
  SPEAKER_01: And they were good crews, and there were southern crews that wanted to stay in the south, so they were kind of happy to come to Atlanta.
• 9:52
  SPEAKER_01: That's what happened from like 2009 to 2011, somewhere in there, uh, there was just kind of like a rapid influx of people coming back.
• 10:04
  SPEAKER_01: And then around 2011 or 2012, the response of the money here in Atlanta, for lack of a better way to say it, people that had money and resources, they also began to want to get involved.
• 10:16
  SPEAKER_01: And because Atlanta has always been such a real estate town, what they did was they built studios.
• 10:22
  SPEAKER_01: They built a lot of studios.
• 10:24
  SPEAKER_01: And that's always been Atlanta's response.
• 10:26
  SPEAKER_01: It's always been a real state town.
• 10:27
  SPEAKER_05: Yeah, we're a dirt town, right?
• 10:28
  SPEAKER_01: Yeah, exactly.
• 10:29
  SPEAKER_05: So the response to the industry was let's put in some buildings, right?
• 10:33
  SPEAKER_05: So we had a huge boom in infrastructure, even though there's no credit for infrastructure, right?
• 10:38
  SPEAKER_05: Right.
• 10:38
  SPEAKER_05: So we kind of got that for free, but yep, all of a sudden we had, I don't want to name all the studios, but we had about five to seven million square feet of purpose-built studios built, I say, between like 2011 to 2022, right?
• 10:54
  SPEAKER_01: Yeah.
• 10:54
  SPEAKER_01: And with that, obviously, uh larger shows like Marvel based out of Pinewood, and other people came in with big footprints.
• 11:05
  SPEAKER_01: About, you know, six months or eight months before the strikes had happened.
• 11:11
  SPEAKER_01: Yeah.
• 11:11
  SPEAKER_01: And the film business was booming like it had never boomed before.
• 11:16
  SPEAKER_01: I've never seen anything like it.
• 11:18
  SPEAKER_01: This is like twenty-one.
• 11:19
  SPEAKER_01: Yep.
• 11:20
  SPEAKER_01: They were at around four billion-ish uh product production expenditures.
• 11:24
  SPEAKER_01: It was incredible.
• 11:25
  SPEAKER_01: But it was unsustainable.
• 11:27
  SPEAKER_01: And what was happening was a lot of the film studios were purchased by streamers and then also by tech companies.
• 11:36
  SPEAKER_01: Yeah.
• 11:38
  SPEAKER_01: The thing that really changed was before the film business was run by people that really understood it, and now the film business was part of a larger tech play.
• 11:48
  SPEAKER_01: Tech yeah, exactly.
• 11:49
  SPEAKER_01: A tech play, that's a good way to say it.
• 11:51
  SPEAKER_01: And they were all wanted to dominate the market.
• 11:53
  SPEAKER_01: That was their idea.
• 11:54
  SPEAKER_01: They were going to come in and dominate the market.
• 11:56
  SPEAKER_05: That was a development boom, right, of the late thousands, early thousands, and twenties when everybody was competing for market share and they were greenlighting a lot of content, right?
• 12:08
  SPEAKER_01: Right.
• 12:08
  SPEAKER_01: And you would get shows, I would get calls about shows where we're having issues, and they'd say, Well, we're having a big problem with the show.
• 12:14
  SPEAKER_01: And I would look at the numbers, and they were the show was costing ten to fifteen million dollars an episode, a huge amount of money.
• 12:21
  SPEAKER_01: And they had a million eyes on it a week.
• 12:24
  SPEAKER_01: And those numbers just don't make sense.
• 12:25
  SPEAKER_01: A show that has that small of an audience with that much of a cost.
• 12:30
  SPEAKER_01: Then but that was happening a lot.
• 12:32
  SPEAKER_01: And so probably about six months before those strikes happened, I was working for MGM Plus, a very small streaming service, and I saw the stopping of development.
• 12:44
  SPEAKER_01: The tech companies just said, stop.
• 12:47
  SPEAKER_01: We you know, we'll do the shows we've already got in the pipeline, but let's not do anything for a while, let's figure this out better because we're spending a huge amount of money for very little return.
• 12:56
  SPEAKER_05: Very little marketing for most of these shows, too, right?
• 12:58
  SPEAKER_01: Yeah.
• 12:59
  SPEAKER_05: You had you know you just had to find it on some streaming specs.
• 13:02
  SPEAKER_01: Exactly.
• 13:02
  SPEAKER_01: And even today, I heard people comment about how Apple won quite a few awards at the Emmys, but nobody watches Apple TV.
• 13:11
  SPEAKER_01: And I've I'm a consumer of I am too.
• 13:14
  SPEAKER_01: So I I definitely watch a lot of Apple TV content, but that's not necessarily the norm.
• 13:20
  SPEAKER_01: So it is still a very fragmented marketing economy.
• 13:24
  SPEAKER_01: And we'll get into more of that later.
• 13:26
  SPEAKER_01: So we had COVID, we had to fight through, but people figured that out.
• 13:29
  SPEAKER_05: And we got, you know, as far as making it well, we were one of the first jurisdictions to open, which once again led to a boom, right?
• 13:36
  SPEAKER_05: I think uh there was a rush into Georgia.
• 13:38
  SPEAKER_05: I think Bray Studios was one of the early leaders trying to figure out what uh quarantine production setup looked like.
• 13:45
  SPEAKER_05: But yeah, all of a sudden we were one of the first jurisdictions to open, which was another boom on top of a boom.
• 13:50
  SPEAKER_05: Right.
• 13:51
  SPEAKER_01: Yeah.
• 13:51
  SPEAKER_01: And and then when those strikes happened, you know, people thought, well, it'll come back after the strikes, but people didn't realize two things, or two or three things happened at the same time.
• 14:01
  SPEAKER_01: First, development has stopped.
• 14:04
  SPEAKER_01: So when the strikes were over, the shows that were being made in Georgia, they started to pick those up and make those and finish those.
• 14:12
  SPEAKER_01: But there was no new development behind that.
• 14:15
  SPEAKER_01: Furthermore, the new contracts were made, shooting in England, especially, but in other places as well, overseas, more attractive.
• 14:25
  unknown: Yeah.
• 14:25
  SPEAKER_05: Yeah, going back to your earlier comment about Canada, just revisit this, we've talked about this, but the reason people went overseas besides the labor strikes was jurisdictions like the United Kingdom, Australia, Ireland had national health care systems.
• 14:40
  SPEAKER_05: They had national pension systems.
• 14:42
  SPEAKER_05: So once again, you didn't have to pay those in terms of fringes, also significant cost savings to shoot overseas, strong dollar.
• 14:51
  SPEAKER_05: Going back to your comments about how Canada got gas.
• 14:54
  SPEAKER_05: Uh and once again, competitive incentives, right?
• 14:57
  SPEAKER_05: A lot of these jurisdictions have very competitive 25-30% incentives.
• 15:01
  SPEAKER_01: Right.
• 15:02
  SPEAKER_01: Right now, and this might be an apocryphal story, so we'll tell it anyway.
• 15:06
  SPEAKER_01: May not be entirely true, but uh right now the Teamster fringes are around 280 bucks a day.
• 15:13
  SPEAKER_01: Uh for a driver, that's the fringes they pay.
• 15:17
  SPEAKER_01: That's what the studio pays on top of their salary for their health and pension plans.
• 15:22
  SPEAKER_01: Now, my understanding is you can hire a lorry driver in England on a movie for less than the fringes alone that we pay here in the state.
• 15:32
  SPEAKER_01: That's not a big hit.
• 15:34
  SPEAKER_01: That's big company.
• 15:35
  SPEAKER_01: Uh and we can talk more about the Teamsters and what's happening with all that when we kind of get a more current day.
• 15:40
  SPEAKER_01: So when we rolled out um after the strikes were over, a lot of the new development, a lot of the new stuff was aimed at overseas mark.
• 15:48
  SPEAKER_01: And there are other reasons for it.
• 15:50
  SPEAKER_01: I don't think we need to go down that rabbit hole, but what that exposed was here in Georgia is that our studios were designed almost entirely from shows from the outside to come in and make content, with the exception of Tyler Perry.
• 16:06
  SPEAKER_01: That's right.
• 16:07
  SPEAKER_01: And that is not a model that is normal for most film studios.
• 16:14
  SPEAKER_01: And I'm talking about the ones in LA, New York, you know, overseas.
• 16:17
  SPEAKER_01: Uh there's usually some content being created at these studios that keeps some of their fulfills your own stages, right?
• 16:27
  SPEAKER_01: Makes you a vertically integrated content producer.
• 16:30
  SPEAKER_01: But because Atlanta is particularly was such a, frankly, you know, a real estate town, uh brick and mortar uh community, we didn't have the the development of the creative to go along with the development of the production facility.
• 16:47
  SPEAKER_01: With the exception of Tyler, a lot of the studios started to become very empty.
• 16:52
  SPEAKER_01: And which is obviously a huge problem for these companies, and have the capacity there, but not have the material to go in.
• 16:59
  SPEAKER_01: So it's been a struggle here for the last couple of years, and it's a it's a struggle of perception because there are always waves in the industry.
• 17:10
  SPEAKER_01: I've been doing this a really long time, way too long.
• 17:13
  SPEAKER_01: And there's always big waves.
• 17:15
  SPEAKER_01: I've never seen a wave as big as the production wave, sure, you know, back before the strikes.
• 17:20
  SPEAKER_01: That was incredible.
• 17:21
  SPEAKER_01: I literally probably couldn't add 10 jobs for every job I did.
• 17:25
  SPEAKER_01: But, you know, that's not sustainable long term, and there's always these dips.
• 17:29
  SPEAKER_01: But I think one of the things that we should focus on in Atlanta and in Georgia is to develop our talent here, hold on to our talent here as much as we can, and find ways to develop things that can be in these stages that are going to be outside of the market of hoping to lure movies from the outside in.
• 17:54
  SPEAKER_01: Yep.
• 17:54
  SPEAKER_05: Yep, build a sustainable, kind of vertically oriented integrated studio system.
• 17:59
  SPEAKER_05: I think a little of that is starting to happen.
• 18:02
  SPEAKER_05: I think some of these stages, at least what I hear, are trying to get content funds going.
• 18:09
  SPEAKER_05: Some of them are courting independent producers to use their facilities for nothing, basically.
• 18:16
  SPEAKER_05: So these are all good developments.
• 18:18
  SPEAKER_05: But uh the thing that you and I have been talking about for years is just it's there's just never been a lot of financing for content here in Georgia.
• 18:27
  SPEAKER_05: You know, it's it's still financed from outside the state primarily, you know, with some exceptions.
• 18:33
  SPEAKER_05: And I think part of that is just an unfamiliarity with content creation, even though we've had this film text credit and we had this film boom.
• 18:42
  SPEAKER_05: I think it's just been very slow.
• 18:44
  SPEAKER_05: And I think our creative class here, while deep, is not necessarily connected with capital.
• 18:51
  SPEAKER_05: Right.
• 18:51
  SPEAKER_05: Bridging that gap has just been slower than anticipated process from my standpoint.
• 18:58
  SPEAKER_01: Yeah, I think people a lot of people don't understand, Peter, that that there's a movie industry, which is based primarily out of LA.
• 19:04
  SPEAKER_01: And I am a product of that industry.
• 19:06
  SPEAKER_01: I have come up through the ranks, I've joined the director's guild, I've worked in director's guild capacities all over the world.
• 19:15
  SPEAKER_01: I then became a producer and executive producer and and kind of worked within many different studios and larger independent, kind of in that framework where the studio attracts the actors, the director, and they have either the money or the connections to the money.
• 19:31
  SPEAKER_01: And so that's all being packaged together.
• 19:33
  SPEAKER_01: And I think here in Georgia, there has been a kind of we talked about this once before, kind of a wall where you, if you're talking brick and mortar, great.
• 19:43
  SPEAKER_01: But now everybody's obviously cooled on brick and mortar, and but there's not the infrastructure that there is for brick and mortar for creative things.
• 19:51
  SPEAKER_01: And there's frankly, as a somebody who's now trying to do independent film, and I'm developing my own projects, yeah, there's a dance that you have to do.
• 20:00
  SPEAKER_01: And that dance is find the right talent.
• 20:02
  SPEAKER_01: Because without the right talent and without the right script, it doesn't matter.
• 20:08
  SPEAKER_01: You can raise money, but it really your project's going to struggle.
• 20:12
  SPEAKER_01: It just won't be marketable, it won't be uh won't be a good product.
• 20:15
  SPEAKER_01: Right.
• 20:16
  SPEAKER_01: Exactly.
• 20:16
  SPEAKER_01: So you attracting talent is incredibly important.
• 20:20
  SPEAKER_01: And for for the money to understand that it's that combination of having a good script, having good talent, and needing the kind of money to fund that.
• 20:31
  SPEAKER_01: Put it another way, I can't go to an actor and say, I have a great script, but they're gonna say, Well, what's the offer?
• 20:38
  SPEAKER_01: Yeah.
• 20:38
  SPEAKER_01: What's where's my attachment money?
• 20:40
  SPEAKER_01: Yeah.
• 20:40
  SPEAKER_01: What's the offer?
• 20:41
  SPEAKER_01: And who are you?
• 20:42
  SPEAKER_01: Yeah.
• 20:42
  SPEAKER_01: Rightly so.
• 20:43
  SPEAKER_01: Even if they know you, yeah.
• 20:45
  SPEAKER_01: They might do you a favor and read it, but they're not gonna bother to attach themselves to it unless they know that there's money there.
• 20:52
  SPEAKER_01: So that's like I say, it's a dance.
• 20:54
  SPEAKER_01: And if you go to a major actor and say, Hey, this is I have an indie film, I can pay you this much money and I can give you these points and do this to be a package for you, would you want to do it?
• 21:06
  SPEAKER_01: They might say, Yes, if I can make that offer, but I have to have the money behind it to make that offer to back that up.
• 21:13
  SPEAKER_01: And to get a financial group bank, uh uh whatever it is, fund to understand that it takes education.
• 21:22
  SPEAKER_05: Well, I think it's definitely education.
• 21:23
  SPEAKER_05: And part of it is I think how does capital or money in Georgia, which they are not able to identify credentialed experts, right?
• 21:33
  SPEAKER_05: So there's this gap.
• 21:35
  SPEAKER_05: Early on, I think a lot of unscrupulous people flooded Georgia when our industry got going, right, in between 2008 and 200, let's say 17.
• 21:47
  SPEAKER_05: And I think some some bad investments were made, right?
• 21:51
  SPEAKER_05: And some bad projects got made or didn't get made, and some money was lost.
• 21:55
  SPEAKER_05: And I think that didn't help, right?
• 21:58
  SPEAKER_05: Uh, because stories have Anecdotal stories like that get around.
• 22:02
  SPEAKER_05: But I think it's it's education and being able to connect capital with credentialed experts who can actually produce marketable, sellable content.
• 22:13
  SPEAKER_05: And that's the gap we need to somehow bridge.
• 22:15
  SPEAKER_05: So instead of it being ad hoc, some producer showed up in town from God knows where and is trying to raise money.
• 22:23
  SPEAKER_05: We have to find a way to connect capital funds, content funds with credentialed experts and produce content marketable.
• 22:34
  SPEAKER_05: So I think that's that's where we are.
• 22:38
  SPEAKER_01: Let's talk a little bit about one thing.
• 22:42
  SPEAKER_01: So I've worked with a lot of studios and a lot of really talented producers.
• 22:47
  SPEAKER_01: And making film content, TV series features, it's very much like drilling for oil.
• 22:56
  SPEAKER_01: It is people have to understand that the pilot of The Walking Dead was directed by and written by Frank Derabont.
• 23:03
  SPEAKER_01: Frank Darabont uh directed and wrote from Stephen King and Novella Shawshank Redemption.
• 23:10
  SPEAKER_01: Now, when Shawshank Redemption came out, a lot of people don't know this, it was a flop.
• 23:15
  SPEAKER_01: It failed.
• 23:16
  SPEAKER_01: It was uh a little mismarketed because they marketed it as a prison movie.
• 23:20
  SPEAKER_01: Right.
• 23:21
  SPEAKER_01: And and there were some other fish in the ocean that were pretty big being uh released that week.
• 23:26
  SPEAKER_01: Uh and so it just didn't do very good business now, obviously.
• 23:30
  SPEAKER_01: Over time, it is you know, stood the test of time, and it's considered one of our greatest movies.
• 23:35
  SPEAKER_01: So you can make a great movie.
• 23:38
  SPEAKER_01: You can make a well-made, really intelligent movie and it doesn't make money.
• 23:43
  SPEAKER_01: Then when I did Jeepers Creepers, it was for Francis Coppola's company, American Sototrope.
• 23:48
  SPEAKER_01: And Jeepers Creepers paid for the other five movies that he made under this put deal he had with MGM Plus.
• 23:56
  SPEAKER_01: That one movie funded all those other films that made enough profit to do that.
• 24:00
  SPEAKER_01: And and I think people here have to understand they're going into a speculative industry, but it's an industry, obviously, that is incredibly lucrative.
• 24:10
  SPEAKER_05: So doesn't that mandate towards maybe it would be better to have a fund approach versus a one-off approach?
• 24:17
  SPEAKER_01: I think the problem with a fund approach, and this is again, we're just talking, is a lot of times you buy into a company, and then production companies tend to get too much overhead.
• 24:27
  SPEAKER_01: In other words, you have too many people and you're not making anything.
• 24:31
  SPEAKER_01: And this is the problem for LA companies and things.
• 24:33
  SPEAKER_01: Yes, I think a fund approach is good, but it has to be a project-driven fund approach.
• 24:37
  SPEAKER_01: In other words, you're buying into five projects.
• 24:40
  SPEAKER_01: Yep.
• 24:40
  SPEAKER_05: Um the other problem I see is with certain funds is every creator wants to produce their own stuff.
• 24:48
  SPEAKER_05: So depending on who you attach to that fund, now they just want to make just their own projects.
• 24:53
  SPEAKER_05: So how do you achieve kind of some diversity?
• 24:56
  SPEAKER_05: Um project based comes up a lot.
• 24:58
  SPEAKER_01: I know somebody right now who I know I could make their movie for them, you know, and probably get mine made as well.
• 25:06
  SPEAKER_01: Now that's kind of painful if their movie's not very good.
• 25:09
  SPEAKER_01: A lot of, frankly, a lot of wealthy people have a vanity project they want to do.
• 25:12
  SPEAKER_01: I think that there is a way today, because of the way production is changing, that maybe you could say, well, let's do five projects, and one of them can be this one.
• 25:23
  SPEAKER_04: Yeah.
• 25:23
  SPEAKER_01: The fifth one.
• 25:25
  SPEAKER_01: And that way you have a carrot.
• 25:27
  SPEAKER_01: And you also, that person, after doing two or three movies, may realize that their content isn't necessarily the way they should go.
• 25:37
  SPEAKER_01: They may can be changed or modified, or maybe even abandoned.
• 25:41
  SPEAKER_01: Um, because a lot of times people have an idea in their head for a movie, but when you actually start making movies and understanding what makes them tick and how they should uh you know, that they need a certain visual style and substance to maintain suspension of disbelief for two hours, that's a hard thing to do.
• 25:57
  SPEAKER_05: That's right.
• 25:58
  SPEAKER_05: And and that magic has to all come together, right?
• 26:00
  SPEAKER_05: The writing, the acting, directing, all things that come together to produce.
• 26:03
  SPEAKER_01: And that for me, that's the fun part.
• 26:05
  SPEAKER_01: For me, the most exciting part of what I've gotten to do is to be able to work with really smart people and really passionate, put everything into it and shape a project, and suddenly it comes together, and you know you've done something special.
• 26:19
  SPEAKER_01: And then that's a wonderful thing.
• 26:20
  SPEAKER_01: And I think that the talent is here in Georgia.
• 26:24
  SPEAKER_01: It's traditionally the talent's been here and left.
• 26:27
  unknown: Yeah.
• 26:27
  SPEAKER_01: Because you couldn't sustain a career here.
• 26:30
  SPEAKER_01: That's right.
• 26:30
  SPEAKER_01: Tyler Perry has proven that's possible to sustain here.
• 26:34
  SPEAKER_01: Now he might be a well-off, but uh, and I think Tyler has shown that he is really truly a studio head, um, is intelligent about making those kinds of decisions to make sure that he always has material that he is developing that's can sustain the studio.
• 26:53
  SPEAKER_01: But these other studios need to be thinking, what can I do that, you know, maybe not on that model, but on other models.
• 27:00
  SPEAKER_01: What can they do to keep the talent here, to develop the talent, and to uh sustain that here?
• 27:06
  SPEAKER_01: And I think that's the next big step.
• 27:08
  SPEAKER_05: So maybe there's an opportunity we talked about due to a confluence of a bunch of factors, massive change in the industry, right?
• 27:15
  SPEAKER_05: We had the strikes, we had COVID, we had everybody going overseas to take advantage of cheaper filming, we had a disruption caused by streaming, loss of traditional theatrical, we've had loss of traditional network advertising.
• 27:30
  SPEAKER_05: So is there an opportunity?
• 27:32
  SPEAKER_05: You know, we talked about this before.
• 27:34
  SPEAKER_05: Uh, I guess productions may be more moderately priced going forward.
• 27:39
  SPEAKER_05: Is that your prediction?
• 27:40
  SPEAKER_05: And does that create an opportunity for creatives in Georgia to get some content made at more moderate budget levels that maybe once again with the help of the studios and maybe some capital, some some funds, start getting content made that can solve this problem?
• 27:57
  SPEAKER_01: One of the funny things, and this is my experience, having done production for many years and coming out of TV movies where you had to make movies for a you know a very low amount of money, make them quickly, like in 20 days, all these things.
• 28:11
  SPEAKER_01: And I think that, yes, I think that shooting content for less money is very possible now.
• 28:19
  SPEAKER_01: And the way that's done is by maximizing the time.
• 28:25
  SPEAKER_01: Right now, I did an experiment we've talked about called uh rejuvenation at Georgia State.
• 28:30
  SPEAKER_01: I was an artist in residence there, and I stupidly said to Brendan Dicker, I don't want to teach, why don't we just make a movie?
• 28:37
  SPEAKER_01: Okay.
• 28:38
  SPEAKER_01: And uh and we did, and uh we made it for twenty thousand dollars.
• 28:42
  SPEAKER_01: I talked a couple of studio friends to donate a bunch of equipment and um we made a feature film.
• 28:49
  SPEAKER_01: Now, I was not expecting because we used students behind the camera and in front of the camera, um I wasn't expecting anything out of it except to be a proof of concept.
• 28:59
  SPEAKER_01: And that proof of concept was really about in my world, in the large feature and television world.
• 29:07
  SPEAKER_01: We spend about forty-five to fifty minutes out of every hour setting things up or knocking things down, moving equipment, dollies, all these things around.
• 29:17
  SPEAKER_01: And I had an idea that kind of inverted that thing where we would spend forty-five to fifty minutes an hour doing creative things and only ten or fifteen minutes.
• 29:27
  SPEAKER_01: How'd you do that?
• 29:28
  SPEAKER_01: We basically got rid of the dolly.
• 29:30
  SPEAKER_01: We used lava mics on the actors, but we also put a mic on a little camera rig that we had.
• 29:35
  SPEAKER_01: We used the easy rig.
• 29:36
  SPEAKER_01: You've seen them at football games with things, the wire things are on the top.
• 29:40
  SPEAKER_01: And that's a very easy learning curve for a student to be able to use that rig and have the camera be very smooth.
• 29:47
  SPEAKER_01: That got rid of the dolly.
• 29:49
  SPEAKER_01: Uh, it gave us a lot of flexibility moving the camera around.
• 29:52
  SPEAKER_01: Furthermore, you could simply walk over and set up your next shot.
• 29:55
  SPEAKER_01: You didn't have to take the dolly track up and put the dolly track down.
• 29:58
  SPEAKER_01: Uh for lighting, we used all practical lighting.
• 30:01
  SPEAKER_01: It was mostly set in a clinic.
• 30:02
  SPEAKER_01: So we had overhead lighting that we put LED tubes in that we could dial in exactly from an iPad, exactly what we wanted.
• 30:09
  SPEAKER_01: The mic, we didn't have a boom mic, we had the mic on the rig itself.
• 30:13
  SPEAKER_01: And so we did a lot of things just to get rid of, so we had no light stands, we had no diali track.
• 30:18
  SPEAKER_01: And the movie technically turned out good.
• 30:22
  SPEAKER_01: And what was really interesting was that I had no desire to distribute it.
• 30:26
  SPEAKER_01: It was just made it for George State.
• 30:27
  SPEAKER_01: We're gonna have a screening.
• 30:28
  SPEAKER_01: And the people at the Moonshine Post who helped the post production, they were frankly fantastic.
• 30:33
  SPEAKER_01: They said, Tom, this is as good as some of the other indie stuff we're seeing.
• 30:37
  SPEAKER_01: So we ended up putting it on Amazon and Tubi.
• 30:40
  SPEAKER_01: Um it's not made any real money because we don't have a marketing plan for it.
• 30:45
  SPEAKER_01: You have to have a marketing plan.
• 30:46
  SPEAKER_01: And it was active with students and things, there's no cachet there, certainly.
• 30:52
  SPEAKER_01: And uh But it is possible you're saying So distribution is very possible.
• 30:58
  SPEAKER_01: The problem is marketing.
• 31:00
  SPEAKER_01: And there's lots of ways to market.
• 31:02
  SPEAKER_01: One of the ways you market is by doing something bombastic, a very scary movie, as we've seen this year uh that appeals to young people, works very well.
• 31:13
  SPEAKER_01: A well-known actor, especially a young actor, does very well.
• 31:18
  SPEAKER_01: There are ways to attract it, but we didn't have any of those things, so the movie's just done very modestly.
• 31:23
  SPEAKER_01: But however, it shows you that there's a need for content and there's an ease to get content on, but it's up to you, the people behind the content, to market the show.
• 31:36
  SPEAKER_01: Yep.
• 31:37
  SPEAKER_01: And getting eyeballs onto whatever you're making is a new challenge.
• 31:42
  SPEAKER_05: And by the way, I see this all the time as uh somebody who's an entertainment lawyer.
• 31:47
  SPEAKER_05: I see here's the budget for the film.
• 31:50
  SPEAKER_05: There's always going to be an overrun, by the way.
• 31:52
  SPEAKER_01: And then zero left over for marketing.
• 31:55
  SPEAKER_01: I think there's a real opportunity for lower budget content to be made, and that can be turned around quickly.
• 32:00
  SPEAKER_01: And you can make quite a few things, and just like the studios have done since I've been in the business and w well beforehand.
• 32:09
  SPEAKER_01: And in the 30s and 40s, it was a put deal.
• 32:12
  SPEAKER_01: Literally, studios, whatever they made, they own their theaters, they put them in.
• 32:16
  SPEAKER_01: So it was easy.
• 32:17
  SPEAKER_01: It was a yeah it was a studio machine.
• 32:19
  SPEAKER_01: But since the 50s, it's become more and more of an independent world as far as material goes.
• 32:25
  SPEAKER_01: So you can make material inexpensively, and if you make five or six things, one of them might hit.
• 32:32
  SPEAKER_01: Yeah.
• 32:33
  SPEAKER_01: You know, and that's and that one thing will pay for everything else and more.
• 32:38
  SPEAKER_01: It'll pay for expansion.
• 32:40
  SPEAKER_01: So that it's an interesting world.
• 32:43
  SPEAKER_01: And there are huge opportunities right now.
• 32:45
  SPEAKER_05: I think there's an opportunity to try to connect capital, you know, funds, uh, studios, which are underutilized, and credentialed experts, because we have a pretty good creative because we we have all the pieces, I think, here in Georgia.
• 33:02
  SPEAKER_05: Whereas just connecting them all and getting them all together.
• 33:06
  SPEAKER_01: And one more thing, I think that also there is an opportunity here for a distribution company or two to be developed here or based out of here, and that targets this kind of things we've been talking about.
• 33:20
  SPEAKER_01: I think that would go a long way.
• 33:22
  SPEAKER_01: You don't have to use them, but to have them here, have them advising what's right now, what's hot, or you know, right now, you know, kind of detective mysteries with a little bit of romance are very hot.
• 33:33
  SPEAKER_01: I mean, so you kind of like they're gonna say, Look, we're looking for this right now, we're looking for that right now.
• 33:38
  SPEAKER_01: And that makes a difference.
• 33:39
  SPEAKER_01: Uh and somebody also that would know the overseas market that could come in and say, if you get this actor, you know, or you use this actor from from Europe, from the Middle East, from Asia, that'll help us with our foreign sales.
• 33:53
  SPEAKER_05: And start making go out and recruit those companies to come here, or those distribution people to come here.
• 33:59
  SPEAKER_05: Because I think the prevailing view uh in LA, let's face it, has always been, you know where to find us.
• 34:05
  SPEAKER_05: We don't need to come find you.
• 34:11
  SPEAKER_01: The problem is what we have as far as infrastructure goes doesn't match that at all.
• 34:18
  SPEAKER_01: We have very little of the kind of distribution financial model and I'm normal creative, yeah.
• 34:26
  SPEAKER_01: And way too much, actually, unless unless the new incentive passes, we'll talk about that in a minute, of facilities.
• 34:34
  SPEAKER_05: Let's talk really quickly what's going on with incentives.
• 34:37
  SPEAKER_05: Georgia was getting the lion's share of the production work in the U.S.
• 34:41
  SPEAKER_05: So New York stepped up and went from a 25% to a 40% credit.
• 34:48
  SPEAKER_05: New Jersey stepped up, reinvented its film program, which had gone defunct at 40%.
• 34:54
  SPEAKER_05: California ramped up its uh film tax credit and added you know significant funding.
• 35:02
  SPEAKER_05: So now all of a sudden Georgia is facing significant competition even within the United States, while at the same time still overseas, but even getting it back as kind of uh possibly a competitive issue.
• 35:18
  SPEAKER_05: And one thing we've talked about in the past was the role of the film tax credit audit process and monetization in Georgia.
• 35:25
  SPEAKER_05: So, as we've discussed, during the peak of the bubble, Georgia implemented procedures which were meant to impose better fiscal oversight of this program.
• 35:35
  SPEAKER_05: But one of the problems was it slowed down monetization of the credits.
• 35:39
  SPEAKER_05: It used to be you spent the money in Georgia, you could sell the credits in the same year and monetize your credits.
• 35:47
  SPEAKER_05: Now you have to wait for a kind of lengthy audit process to be finished, which has gotten more streamlined in recent years.
• 35:54
  SPEAKER_05: So monetization has slowed down.
• 35:56
  SPEAKER_05: So let's talk about where we are, let's talk about the federal credit.
• 36:00
  SPEAKER_01: Obviously, there's overseas credits, and that's been doing a lot.
• 36:04
  SPEAKER_01: You know, we've talked a little bit about England and some of the other countries, South Africa, that have very lucrative credits and other aspects of their production.
• 36:12
  SPEAKER_01: Like, for example, in if you hire an English writing crew to do your show, they don't make you hold your uh writers from the beginning of the show to the end of the show if you have a staff of writers.
• 36:25
  SPEAKER_01: It makes a difference.
• 36:26
  SPEAKER_01: It's an appreciable difference as far as your budget goes.
• 36:29
  SPEAKER_01: The same thing's true for cast.
• 36:30
  SPEAKER_01: So if you hire an actor that you know is going to work four days on your board, you can go to their agent and book those four days.
• 36:38
  SPEAKER_01: You better hit those four days, but you don't have to pay the intervening days like we have to in the state.
• 36:45
  SPEAKER_01: So there's advantages by shooting overseas.
• 36:48
  SPEAKER_01: There's the advantage of, you know, pension and health.
• 36:51
  SPEAKER_01: The costs are very little overseas because they have universal pension and health.
• 36:55
  SPEAKER_01: And there's exchange rate savings.
• 36:58
  SPEAKER_01: But um, as far as incentives go in the states, the New York credit and the New Jersey credit are rebates, correct?
• 37:04
  SPEAKER_05: They're not actually uh So New York's a refundable credit, yeah.
• 37:08
  SPEAKER_05: It's a rebate.
• 37:08
  SPEAKER_05: Okay.
• 37:09
  SPEAKER_05: Now it does take typically a multi-year process to get your credits seven to nine years.
• 37:15
  SPEAKER_05: New Jersey's, however, is transferable and they also have a sellback.
• 37:19
  SPEAKER_05: So in New Jersey, you can either sell your credit like in Georgia, third party, or you can sell it back to the states and pay 95% backstop.
• 37:28
  SPEAKER_01: Okay.
• 37:29
  SPEAKER_01: So and in Georgia, however, you have to sell your credit.
• 37:33
  SPEAKER_01: So if there's a year, for example, that like recent years, most investors are doing pretty well because the stock market's done pretty well.
• 37:41
  SPEAKER_01: That's right.
• 37:41
  SPEAKER_01: But if we have a downturn next year, it may be a little harder to sell your credit.
• 37:45
  SPEAKER_01: You might have to give up a little bit more money.
• 37:47
  SPEAKER_01: So it's a this is a tax credit, and it's you have to buy it in chunks, right?
• 37:52
  SPEAKER_01: You cannot, it used to be you couldn't break it up at all, but now you can break it up.
• 37:55
  SPEAKER_05: Yeah, you can you can I think it's fairly well bought.
• 37:58
  SPEAKER_05: I think most of the larger CPA firms at this point offer it to their clients.
• 38:02
  SPEAKER_05: But uh but yeah, it depends on the economy, right?
• 38:06
  SPEAKER_05: So people have to have Georgia income tax liability to buy credits.
• 38:10
  SPEAKER_05: There's obviously been a drive to reduce the Georgia income tax rate.
• 38:15
  SPEAKER_05: And in fact, we've gone from a 6% Georgia maximum income tax rate down to 4.99.
• 38:22
  SPEAKER_05: There's talk of taking it down to three.
• 38:24
  SPEAKER_05: Obviously, that reduces demand for credits and could impact credit markets.
• 38:29
  SPEAKER_05: So maybe you don't realize right now I think productions are probably netting around 90 cents, maybe 92 cents on their credits when they sell them.
• 38:37
  SPEAKER_05: That might go down.
• 38:38
  SPEAKER_01: Right.
• 38:39
  SPEAKER_01: The reason I bring that up is just to say the studios look at everything.
• 38:43
  SPEAKER_01: The more it's a sure thing, the more they like it.
• 38:46
  SPEAKER_01: In Georgia, it used to be that you would shoot your show, this really smart guy, and who came up with the sampling thing, and that guy being you, uh, that would allow you to get your money back reasonably quickly.
• 38:58
  SPEAKER_01: And you would get it for the year you shot your project in.
• 39:02
  SPEAKER_01: Now you get your credit in the year that your credit is basically vetted and certified.
• 39:12
  SPEAKER_05: So you've lost control over the timing, your monetization.
• 39:15
  SPEAKER_05: That's right.
• 39:15
  SPEAKER_05: That's a big change.
• 39:16
  SPEAKER_01: And I think that it's important for the state of Georgia to realize that's a big problem because we're one of the things that's an advantage of Georgia has, and I think you you're the one that told me this, that it takes several years to get your New York credit.
• 39:28
  SPEAKER_01: Yep.
• 39:29
  SPEAKER_01: It takes several years to get your New Jersey credit, I think, a couple of years, right?
• 39:32
  SPEAKER_05: Uh no, they're maybe not as fast as Georgia, but it's it might take you a year or two.
• 39:36
  SPEAKER_05: Okay.
• 39:37
  SPEAKER_01: But in Georgia, if we could say you shoot your project this year, and I finish in August, even though I might not get my audit complete until January or February, I would still get my credit for the year I shot my project in.
• 39:50
  SPEAKER_01: And I think that would be a huge help because then you can sell the credit for that year.
• 39:55
  SPEAKER_01: You don't have to wait another entire year to sell your credit.
• 39:58
  SPEAKER_05: Yep, time is money, right?
• 39:59
  SPEAKER_05: So I agree.
• 40:01
  SPEAKER_05: If there were a way to tweak this program, one of the easiest tweaks without having to go up to 40% necessarily or match New York and New Jersey would be to go back to the old way of allowing you to sell the credits the same year you spend the money.
• 40:17
  SPEAKER_01: Exactly.
• 40:17
  SPEAKER_01: And that makes sense.
• 40:18
  SPEAKER_01: It makes sense on just on a pure economics level.
• 40:21
  SPEAKER_01: I think that would go a long way to helping us market our credit as a something that is um current dollars are always better than future dollars.
• 40:29
  SPEAKER_05: Absolutely, especially as interest rates are going up, right?
• 40:32
  SPEAKER_05: So at six, seven, eight percent interest rates, yeah, the time value of money increases.
• 40:37
  SPEAKER_01: And I think the financial side of the studios will see that.
• 40:40
  SPEAKER_01: So even though our incentive may be less, getting that money quicker is going to make a huge advantage in terms of getting business right.
• 40:48
  SPEAKER_05: So I do agree that would be a very useful tweak, really going back to where we started, because that's where we started at.
• 40:55
  SPEAKER_01: Yeah, exactly.
• 40:56
  SPEAKER_01: And I think that would go a long way to getting shows to start really paying attention to Georgia again.
• 41:01
  SPEAKER_01: You know, the other thing on the business side is that there's been some fluctuations with the unions here.
• 41:08
  SPEAKER_01: The Teamsters deal got to be much more expensive, and they added a lot of categories.
• 41:13
  SPEAKER_01: That combination and the studios having the deal change on them pretty regularly, that's something that else that we should talk about.
• 41:21
  SPEAKER_01: Studios like a stable situation.
• 41:24
  SPEAKER_01: If you're gonna bring it, especially a TV series, to a place like Georgia, you want it to be rock solid.
• 41:30
  SPEAKER_01: The ideal life of a TV series is probably five to six years.
• 41:34
  SPEAKER_01: Longer, like The Walking Dead, is always great.
• 41:36
  SPEAKER_01: Yeah, but basically, if you've made a show for five or six years, you're gonna have a healthy return on your investment.
• 41:43
  SPEAKER_01: And so they want to have deals in place that they know they can go back and things cost a little bit more every year.
• 41:48
  SPEAKER_01: They expect that.
• 41:50
  SPEAKER_01: Cost of living is is normally built in.
• 41:53
  SPEAKER_01: Uh they know that uh there'll be other things that could happen, but they want their label base to be stable.
• 41:58
  SPEAKER_01: And in this case, that wasn't the case.
• 42:02
  SPEAKER_01: And a lot of that, I believe, was driven by outside forces on the Teamsters.
• 42:08
  SPEAKER_01: Now, I've been through a lot of changes in the industry here.
• 42:11
  SPEAKER_01: Uh when I first started out, there was no studio mechanics local, there was no 479, and that didn't come about till 86.
• 42:18
  SPEAKER_01: And the before then, it was uh either NABET, which was a basically a New York group of National Association of Broadcast Engineers and Technicians, or it was uh local 41 occasionally.
• 42:31
  SPEAKER_01: And in the Teamsters, Teamsters actually had a different local here.
• 42:35
  SPEAKER_01: 528.
• 42:36
  SPEAKER_01: 728 changed, and 528 is a m was a much smaller, I was like 35, maybe 2,500 members at the time.
• 42:45
  SPEAKER_01: And of course, I loaded trucks for the team.
• 42:48
  SPEAKER_01: I was a Teamster.
• 42:48
  SPEAKER_01: I loaded trucks when I was in grad school for UPS, and you have to be a Teamster to work for UPS, and that is 15,000, I think, of the current 20,000 members.
• 42:57
  SPEAKER_01: So that that's the 800-pound gorilla for the Teamsters here.
• 43:00
  SPEAKER_01: And and why I bring that up is I think that Teamster Local didn't have the pressure, the market pressure brought to bear on them.
• 43:08
  SPEAKER_01: Because their big market is UPS.
• 43:11
  SPEAKER_01: Their big market isn't moving.
• 43:15
  SPEAKER_01: So making outside forces being brought to bear on them, making them happy and keeping their political future good, that was easy.
• 43:22
  SPEAKER_01: That was an easy decision for them to make.
• 43:24
  SPEAKER_01: Not easy, but I mean easier.
• 43:26
  SPEAKER_01: So I think and people need to understand that just like um the on the creative side, on the labor side, our labor is dominated by New York and LA.
• 43:37
  SPEAKER_01: And that's true for my union, the Director's Guild, although we now have a chapter here in Atlanta, I'm proud to say.
• 43:45
  SPEAKER_01: Uh so I think that having the leaders of our local unions accountable.
• 43:51
  SPEAKER_01: Just being able to realize that that there are going to be market fluctuations and trying to make sure that they can dance to that market fluctuation.
• 43:58
  SPEAKER_01: Right now, for example, are RIA is under the control of New York entirely right now because of some issues that came up.
• 44:05
  SPEAKER_01: We don't need to go there.
• 44:06
  SPEAKER_01: But uh so it's an interesting conundrum for Atlanta to you know control the their own destiny as far as labor goes.
• 44:15
  SPEAKER_01: But there are opportunities, I think, now that because the the way we make things is changing so that there are opportunities now to have that be less of an issue.
• 44:27
  SPEAKER_05: Yeah.
• 44:28
  SPEAKER_05: Last but not least, uh I I feel like I have to mention the federal incentive.
• 44:33
  SPEAKER_05: So we talked about uh loss of production overseas, we talked about increasing pressure amongst the states.
• 44:42
  SPEAKER_05: So there's been President Trump a few weeks ago tweeted uh support for a federal film tax credit and asked for bipartisan congressional support.
• 44:53
  SPEAKER_05: I think it was last week legislation was introduced, Congress, which would create a 20% federal level transferable federal credit.
• 45:03
  SPEAKER_05: Do you think that would be useful in bringing production back and leveling?
• 45:09
  SPEAKER_01: This is what we call high lob.
• 45:11
  SPEAKER_01: This is, yeah, obviously this would be huge.
• 45:15
  SPEAKER_01: This would be the biggest thing since passing our state incentive in 2008, 2009.
• 45:21
  SPEAKER_01: By far.
• 45:22
  SPEAKER_01: And I've been for this for a long time, and not because I think that we should be in the incentive business, but because other countries like Canada are.
• 45:30
  SPEAKER_01: And very actively are targeting our industry and have for a long time.
• 45:35
  SPEAKER_01: And to be fair, I've worked overseas.
• 45:37
  SPEAKER_01: You know, they have been trained up by our industry.
• 45:41
  SPEAKER_01: They know how to make movies there now, and because of our people having to go overseas to work.
• 45:48
  SPEAKER_01: And I think if we get this incentive, you'll see a rapid influx of work coming back to the States.
• 45:56
  SPEAKER_01: It'll be hugely beneficial for our labor market here.
• 46:02
  SPEAKER_01: It'll be huge here for Georgia.
• 46:04
  SPEAKER_05: And I think it's good that the president and others are realizing that this is a strategic industry for the United States.
• 46:11
  SPEAKER_05: It's a projection of our cultural and soft power.
• 46:14
  SPEAKER_05: So it's just nice at the national and state level to recognize this is a business that we want to keep.
• 46:21
  SPEAKER_05: It's good for the United States and it's good for the individual states to have this business.
• 46:26
  SPEAKER_05: So I'm really hoping that Georgia can go back to capitalizing on an early lead in this business.
• 46:33
  SPEAKER_05: You know, we went from zero to a hundred.
• 46:35
  SPEAKER_05: I would hate for us to kind of lose or advantage all the infrastructure we built, all the education we put in place, like the Film Academy.
• 46:43
  SPEAKER_05: Yeah.
• 46:44
  SPEAKER_05: So I'm keeping my fingers crossed on the federal level and what we can do to speed up monetization of the state.
• 46:50
  SPEAKER_01: And that's a pretty attractive number.
• 46:52
  SPEAKER_01: If we can develop, like you were suggesting earlier, uh more inroads to finance and more inroads to development here, we could then build the infrastructure in the studios to make them more immune to market vagaries like we've experienced.
• 47:08
  SPEAKER_01: Which will happen again.
• 47:08
  SPEAKER_01: Yeah, which will it always happen.
• 47:10
  SPEAKER_01: Yep.
• 47:11
  SPEAKER_05: Well, uh those were the things I wanted to talk about.
• 47:14
  SPEAKER_05: So what else uh should we cover?
• 47:16
  SPEAKER_01: You know, we're at a really interesting time.
• 47:18
  SPEAKER_01: We're facing an election.
• 47:20
  SPEAKER_01: Uh we're gonna have a new governor, and we also are gonna have a new film commissioner.
• 47:25
  SPEAKER_01: We have a chance maybe to tweak our incentives uh to help the market.
• 47:30
  SPEAKER_01: And I do think that whoever comes in as film commissioner and comes in as governor, if we can have them make a push for marketing our state, and it's gotta be someone and done in some way that a targeted marketing of the studios.
• 47:51
  SPEAKER_01: There have been people that have shot here recently um that have had a good experience.
• 47:57
  SPEAKER_01: The Teamsters are now willing to make multi-year deals.
• 48:00
  SPEAKER_01: They are trying to work with producers in a more uh productive way.
• 48:04
  SPEAKER_01: The IA uh issues that uh have not been an issue, uh, according to the people I've talked to recently.
• 48:09
  SPEAKER_05: We've talked about the incentive and the audits have been significantly streamlined, or they were pretty clunky.
• 48:15
  SPEAKER_05: And have that process has been sped up.
• 48:17
  SPEAKER_01: And and just like Warner Brothers in 2008 and 2009, when we did Past Life and uh Vampire Diaries, they were slow to adjust to Georgia.
• 48:28
  SPEAKER_01: And so now that the work has flown away from here, we really need to target the studios and go in and have those things that have shot here that have loved shooting here and have had a very good experience.
• 48:40
  SPEAKER_01: Have that documented, have someone who can speak to the studios because they look literally at four or five different spreadsheets of different places to shoot at and what the advantages are and everything.
• 48:50
  SPEAKER_01: And we need to be back on that on that spreadsheet again.
• 48:54
  SPEAKER_01: We do.
• 48:54
  SPEAKER_05: And and so you know, Tom, that in addition to my other four jobs, I'm on the board of the Georgia Screen Entertainment Coalition.
• 49:02
  SPEAKER_05: I think we as an industry, or at least what I'm hoping is we as an industry can really lean in and educate whoever the new governor is, lieutenant governor, some of the new legislators, new film commissioner, some of these opportunities.
• 49:15
  SPEAKER_05: Uh, because you know, this is a critical juncture in Georgia's entertainment industry.
• 49:20
  SPEAKER_05: So I agree with you.
• 49:21
  SPEAKER_05: This would be a great time to step in and really educate people about some of the advantages of shooting here, kind of get the miracle going again.
• 49:31
  SPEAKER_01: Yeah, and I think Lee Thomas was a wonderful uh film commissioner, but frankly, a lot of times her hands were tied.
• 49:38
  SPEAKER_01: She didn't have the economic resources to do marketing.
• 49:42
  SPEAKER_01: And um, I think when we put in a new governor with a new film commissioner, you'd like to see some more marketing resources.
• 49:49
  SPEAKER_01: I think we need both on the private side and on the public side, we need to do a very targeted uh to the studios marketing campaign showing success.
• 50:00
  SPEAKER_01: Because if we can show success, and that's bona fide by people in the industry that uh you know that are more than happy to talk about their shooting in Georgia, from what I understand.
• 50:09
  SPEAKER_01: I think that that's gonna go a long way towards getting them to start coming back and feeling good about coming back to Georgia again.
• 50:17
  SPEAKER_01: Frankly, a couple of studios have felt a little burn having shot here and having the landscape change underneath them.
• 50:24
  SPEAKER_01: And that's that's something we want to assure them that that's not gonna happen again.
• 50:29
  SPEAKER_05: I agree, and it and it takes time.
• 50:30
  SPEAKER_01: Yeah, I mean there's a ready film community here, which is great, and I think there are advantages because of that uh here, whereas in I understand in some of the other places that are booming right now, like New York and New Jersey, um, they're struggling to fill those jobs.
• 50:46
  SPEAKER_01: That's right.
• 50:46
  SPEAKER_01: So I do think that there's an opportunity here to do some very targeted marketing to lure back people who have been here before and new people.
• 50:56
  SPEAKER_05: Yeah.
• 50:57
  SPEAKER_05: I think for my part, GSEC is gonna step into that a little bit.
• 51:00
  SPEAKER_05: Anything else before we wrap up that we should have.
• 51:02
  SPEAKER_01: Well, this is been a lot of fun.
• 51:03
  SPEAKER_05: Yeah, we've covered a lot of ground and I learned a lot.
• 51:06
  SPEAKER_05: So appreciate it.
• 51:08
  SPEAKER_05: Thanks for coming in, and hopefully we can continue the conversation.
• 51:11
  SPEAKER_05: Thank you.
• 51:13
  SPEAKER_00: That wraps up today's episode of Beyond the Ledgers the Growth Exchange with Peter Stethopoulos and Tom Luce.
• 51:19
  SPEAKER_00: Tom's career offers a front row view into the evolution of Georgia's entertainment industry.
• 51:24
  SPEAKER_00: From its early production days to the growth fueled by film incentives and the challenges shaping the industry today.
• 51:31
  SPEAKER_00: As Peter and Tom discuss, the next chapter will depend not only on great talent and storytelling, but also on strategic investment, innovation, and connecting creators, capital, and opportunity.
• 51:45
  SPEAKER_00: A special thanks to Peter for leading today's conversation and to Tom for sharing his experience and perspective on where the industry has been and where it could go next.
• 51:54
  SPEAKER_00: Thanks for tuning in to Beyond the Ledger.
• 51:56
  SPEAKER_00: For more insights and expert perspectives, visit BtCPA.net and explore our latest resources.
• 52:03
  SPEAKER_00: And don't forget to like, follow, share, and subscribe.
• 52:06
  SPEAKER_00: Until next time, I'm Sard A Layfield, and we'll see you for the next conversation.