As the global economy undergoes transformative changes, the media and entertainment industry is also repositioning accordingly. This includes, but not limited to, scripts, publishing, film/motion pictures production, branded content/product placement, television, online videos, cable networks and satellite distributors. The overarching fiscal, financial, accounting policy and regulatory framework covering media and entertainment industry in also process of preparing, enacting and issuing new standards for methodology and approach for licensing, contracts, revenue recognition and related areas. Impacted will be both public-listed and private companies.
For film/motion pictures, any proposed and enacted legislation as well as fiscal, financial, and accounting policy, regulatory framework and standards will have both direct and indirect effect on the “Script-To-Screen” value chain. A detailed evaluation and analysis must be conducted on the entire process of; Script Origination, Intellectual Property Rights (IPR), Licensing and generating tangible revenues via Right-To-Use and Right-To-Access. Each film/motion picture industry stakeholder(s) must determine most likely scenario(s) with respect to their own entity(s) as well as current and future business strategy, execution and functional operations. In addition, shared economic interest(s) between each counter-party (Licensor vs. Licensee) must be assessed with respect to actual sales and/or usage-based payments, fees, and royalties.
Based on the above, there is an increased refocus on the key role of structured project finance along the “Script-To-Screen” value chain consisting of Development-Production-Distribution. Funding and/or financing of these film/motion picture projects is predicated by the capital formation, allocation and deployment process with resulting returns (Return of Capital and Return on Investment).
This is applicable to script(s) and other content which may be originated and/or owned by either individual(s), studio(s) or independent producer(s). Further, “Script-To-Screen” will be subject to recourse finance, limited recourse, and non-recourse finance supported by sound and “bankable” transactional contracts which are subject to above mentioned proposed and enacted legislation as well as fiscal, financial, and accounting policy, regulatory framework and standards. Finally, the applicable budget(s) for Development, Production and Distribution will be subject to capital expenditures (CAPEX) and operating expenditures (OPEX) which must be funded and/or financed.