After a Historic Hollywood Tax Break, Is Moviemaking Coming Back to California?

Summary

Podcast Summary: The Town with Matthew Belloni

Episode Title: After a Historic Hollywood Tax Break, Is Moviemaking Coming Back to California?
Host: Matt Bellany
Release Date: July 9, 2025
Source: The Ringer

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Introduction

In this episode of The Town with Matthew Belloni, host Matt Bellany delves into California's newly enhanced tax incentives aimed at revitalizing moviemaking within the state. As Hollywood faces a persistent exodus to states like Georgia and New York, California's recent legislative moves signal a strategic push to retain and attract film and television productions.

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California's Enhanced Tax Incentive Package

California has significantly overhauled its tax incentive program to make the Golden State more competitive in the national film production landscape.

• Increased Funding Cap: The annual incentive cap has been more than doubled from $330 million to $750 million, making it one of the most substantial programs in the country.

  Joe Quianese (SVP of Incentives, Entertainment Partners) [04:47]: "They've made some pretty bold moves in terms of increasing the funding. The annual funding to $750 million a year, that's more than double than it was before."

• Higher Base Credit Rates: The base credit for productions has risen from 20% to 35%, with relocations eligible for up to a 40% credit.

  Joe Quianese [05:28]: “So a $100 million movie, the base credit, assuming it's all labor, they would get back a $35 million credit.”

• Expanded Eligibility: The new legislation includes animation and competitive series, broadening the types of productions that can benefit. However, reality TV remains excluded.

  Joe Quianese [06:44]: "And we've got animation now, competition shows qualify, and TV less than 30 minutes, but unfortunately no reality."

• Refundable Tax Credits: For the first time, California offers refundable tax credits, allowing producers without significant tax liabilities to benefit from the incentives.

  Joe Quianese [12:29]: “It's now refundable. Unless you have an income tax or a sales tax liability, you can elect to get that credit back, albeit at 90%, spread over five years.”

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Expert Insights: Interview with Joe Quianese

Matt Bellany welcomes Joe Quianese, SVP of Incentives at Entertainment Partners, to dissect the implications of California's new tax incentives.

Impact on Production Location Choices

Quianese emphasizes that while California's package is generous, it still faces stiff competition from other states and countries offering more lucrative incentives.

Joe Quianese [05:23]: "They've made some pretty bold moves... pretty close to one of the highest in the country."

However, he acknowledges key limitations, notably the exclusion of above-the-line (ATL) costs such as actor salaries, which are often substantial in major productions.

Joe Quianese [07:17]: "So if you're producing unscripted content, it wouldn't qualify."

Comparison with Other Jurisdictions

• New York: Recently enhanced its own incentive program, allowing similar ATL credits and offering quick reimbursement timelines, making it a formidable competitor.

  Joe Quianese [10:26]: “New York now has an Empire State Independent Film credit where you can also get between 30 and 40% with all your ATL qualifying.”

• United Kingdom and Canada: Both offer high percentage credits with fewer restrictions, such as participation payments in the UK and combined federal and provincial incentives in Canada that can exceed 40-50%.

  Joe Quianese [25:09]: "Canada offers great federal and provincial incentives... can give a producer in excess of 40 to 50% back on every dollar they're spending."

• Georgia and Texas: Continue to offer competitive programs without annual caps, attracting a significant number of productions.

  Joe Quianese [12:36]: "Georgia still offers a very competitive program... Texas is aggressively getting into the game as well."

Future Prospects and Challenges

Quianese remains cautiously optimistic but realistic about the potential for California to reverse decades of production migration.

Joe Quianese [26:04]: "Given the fact that we've doubled the amount of money... we should see... increased jobs because there's obviously going to be increased production spend in the state."

However, he concedes that competing with the UK's comprehensive incentives remains a significant hurdle.

Joe Quianese [27:17]: “It's hard to compete with the UK given they're offering a base credit of 25.5%, as high as 40%.”

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Industry Reactions and Expectations

Matt and his guest discuss the industry's reception to the new incentives. While some in the industry are hopeful, others remain skeptical about whether these measures will be sufficient to stem the tide of productions moving elsewhere.

Matt Bellany [19:54]: “On this state, I know it's a reality situation... but you're looking at an exodus of these jobs and these producers where other states are not saying that.”

Additionally, the discussion touches on the operational aspects of the incentive program, such as application processes emphasizing job creation and accurate budgeting to prevent misuse.

Joe Quianese [14:05]: “There's an application window... projects that show they're going to create or maintain the largest percentage of jobs have a higher percentage of being selected.”

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Broader Implications for Hollywood and Content Creation

The episode explores how these incentives might influence not just traditional film and television but also newer content forms like short-form videos.

Joe Quianese [23:28]: “One thing I do want to highlight... as long as 75% or more of the product project is shot in the state and it's a million dollars or more spend, it should qualify.”

However, unscripted and certain digital content still fall outside the eligible categories, limiting the scope.

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Conclusion and Future Outlook

As California ramps up its efforts to reclaim its position as the heart of moviemaking, the effectiveness of these new tax incentives remains to be seen. With significant investments now in place and a more inclusive approach to different types of productions, there's potential for a resurgence. However, entrenched competition from other states and countries with more aggressive incentives poses ongoing challenges.

Matt Bellany [26:57]: “I don't see Marvel moving back from Georgia... the infrastructure is so strong there.”

The episode underscores a pivotal moment for Hollywood, where strategic policy changes in California might influence the future landscape of film and television production in the United States.

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Notable Quotes:

• Joe Quianese [05:28]: “So a $100 million movie, the base credit, assuming it's all labor, they would get back a $35 million credit.”

• Joe Quianese [12:29]: “It's now refundable. Unless you have an income tax or a sales tax liability, you can elect to get that credit back, albeit at 90%, spread over five years.”

• Matt Bellany [19:54]: “On this state, I know it's a reality situation... but you're looking at an exodus of these jobs and these producers where other states are not saying that.”

• Joe Quianese [26:04]: “Given the fact that we've doubled the amount of money... we should see... increased jobs because there's obviously going to be increased production spend in the state.”

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Tags: #Hollywood #TaxIncentives #California #FilmProduction #EntertainmentIndustry #MatthewBelloni #TheRinger #MovieMaking #EconomicPolicy

Transcript

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[Matt Bellany]

It is Wednesday, July 9th. I feel like every week I read a new article, Hollywood is Leaving Hollywood, the production exodus continues. That kind of stuff. Never mind that the exodus has been going on for more than two decades now, thanks to aggressive production incentives everywhere from Georgia to Michigan to the UK or Bulgaria. It's just that we're paying more attention now because the overall content recession is exposing the fact that not a lot of shows and movies are made in California. But last week the state decided to do something about it. Or at least it decided to do a little more than it had been doing at the urging of Governor Newsom and a few key Democrats. Interestingly, a lot of the same Democrats who once called production incentives corporate welfare, the state made two separate moves intended to give the major studios and independent producers a reason to stay in California. First, they increased the state's incentive cap from 330 million a year to 750 million a year, one of the biggest in the country. It's more than doubling it. Then they passed a bill raising the base credit for productions to 35%, with shoots that relocate from other states and countries eligible for up to 40%. That's money you get back on your spend in the state. They also expanded the kind of productions eligible to include animation and big competition series. So hopefully Rob Lowe won't have to go to Ireland to make his Fox game show. He's complained about that. There are some other new details, like the fact that the California incentive still doesn't cover above the line costs. So no deducting Tom Cruise's Mission Impossible payday. All of it begs the question, how much does this actually matter? Is California back? Are we going to start to see production trucks on every corner like we once did in la, or is this all too little, too late? The arms race to lure productions has already passed the state by today. We've got Joe Quianese. He, he's the SVP of Incentives and Entertainment Partners. He's been on the show before. That's the financial services company for the industry. We're going to go through what the new California plan offers and most importantly, what it doesn't offer. Fact check some of the press releases today. It's California's new incentives. Is the home of Hollywood finally ready to be a Hollywood player? From the ringer and puck, I'm Matt Bellany and this is the town. Okay. We are here with Joe Quanesse, who is the SVP of incentives at Entertainment Partners and an expert on the various tax, credit and incentive schemes from around the world. And I do use the term schemes there because it is very hard to discern what these new initiatives are and are not. There's a lot of press releases going around this past week. After the California initiatives were passed, Fran Drescher, the president of SAG aftra, called for a quote, hot production summer. I don't know what that means. There were other press releases from the Entertainment Union Coalition talking about how we can look forward to our members getting back to work where they live. I want your opinion because you are the guy that people go to when they want to know what's real and what's not. Are you excited about this California initiative? Are you rolling your eyes? Are you somewhere in the middle? Like, what is this and what is this?

[Joe Quianese]

Not so. I'm very excited about California.

[Matt Bellany]

You are?

[Joe Quianese]

I am, I am. They've made some pretty bold moves in terms of increasing the fight. The annual funding to 750 million a year, that's more than double than it was before. Pretty close to one of the highest in the country in terms of states that have annual funding caps. States like Georgia don't have annual caps. But right now New York and California are on the top of the tier, New Jersey being the top three states with annual caps offering anywhere between 750 and 800 million a year. The other big change for California is bumping up the credit from a basic credit from 20% to 25%, 35 to 40%, which is huge.

[Matt Bellany]

So how would that play out? Give me an example on, let's say a $100 million movie.

[Joe Quianese]

So $100 million movie, the base credit, assuming it's all labor, they would get back a $35 million credit. What California also has is no caps on the credit or how much you can spend. So the only limitation, the only thing I'm disappointed in, and I was hopeful that it would happen, is the allowance of atl. ATL is the actors, producers, directors, as a call, above the line. Above the line, Correct.

[Matt Bellany]

That was never happening. You thought that was going to happen. No politician wants the impression that they're giving money to Tom Cruise.

[Joe Quianese]

I agree. I think it will happen eventually. It happened in New York.

[Matt Bellany]

It did happen in New York. You're right.

[Joe Quianese]

New York said the same thing was never going to happen. And then they allowed a handful above the line position to qualify. Just this year, under the governor's new budget, all ATO qualifies now, no caps, except for an overall cap of 40% of the new York spend. So New York is now very, very competitive in the ATL space.

[Matt Bellany]

I look forward to Tom Cruise jumping off the Empire State Building in the next Mission Impossible.

[Joe Quianese]

It will happen. So, yeah. So California, in addition to more money, more credit, they've also expanded what qualifies. So animation now qualifies, competition shows qualify and TV less than 30 minutes.

[Matt Bellany]

Thank God, you know, Rob Lowe having to fly to Ireland to record his game show, that we were all on pins and needles there. We did not want Rob Lowe to have to fly to another country.

[Joe Quianese]

And that's another big change that's happening outside the country. Mat is like Ireland, for example, not only always allowed game shows, but they recently now allow reality TV to qualify. That's one thing here in California, we did not change the rules to include. So we have scripted, we have competition shows, we've got animation, and We've got Tyler TV less than 30 minutes, but unfortunately no reality.

[Matt Bellany]

So Housewives and all that stuff, they're not getting any credits.

[Joe Quianese]

Correct.

[Matt Bellany]

Why? Why do you think that didn't make it?

[Joe Quianese]

I wish I could give you an answer. I think, you know, there were so many proposed changes. I think it's something that may change over time. Just like atl I think in terms of everything they've done thus far, I'm very excited. I would say California is very competitive right now. The only thing that would made it unstoppable is the atl. I think the inclusion of ATL is, is critical. I think ATL drives btl. You know, when you have projects with huge above the line, it usually means it's a big movie. And big movies bring a lot of below the line crew as well.

[Matt Bellany]

Well, and that gets to the post production credit. What do they do for post production? Because that's been a big issue where a lot of the outsourcing to Canada and other places, Australia, New Zealand, has really impacted the base post production talent pool in la.

[Joe Quianese]

I mean, California does not give you a post only, unfortunately. So you can get a bump or an uplift if you do your post here, but you cannot get posts only. So it's your physical production. And if you do your post here, I think you get a 5% bump.

[Matt Bellany]

Okay. So you get a benefit if you're doing both, but you're not going to shoot a movie elsewhere and then do the post here and get a credit.

[Joe Quianese]

Correct. Which is what happens a lot of times in Canada. You have a lot of projects that shoot either in New York or in Georgia and they'll bring the post to, to Canada. So they have significant post and visual effects credits.

[Matt Bellany]

Okay. And shooting outside of LA got specific booths. Right. In order to get this through a legislature that is majority non LA people, they had to specifically incentivize production outside of LA county. Am I right with that?

[Joe Quianese]

That's correct. We've always had that. It's called the 30 mile zone. Anything time you shoot outside the 30 mile zone, you get a 5% bump. So again, the base credit's 35% and if you shoot outside that zone, you get 40%.

[Matt Bellany]

Is Santa Clarita outside that zone?

[Joe Quianese]

It is.

[Matt Bellany]

Oh, so that's why it's there.

[Joe Quianese]

Correct.

[Matt Bellany]

Interesting. Okay, so you're bullish on this because I talked to someone at one of the major studios who does their budgeting and this person was like, yeah, it's good. Is it going to cause us to abandon the UK or all of a sudden start shooting? I don't want to give away wood studio here, but start shooting major tentpole franchise A in the US Maybe not.

[Joe Quianese]

I think that goes back to the bubble line. UK is giving an incentive on a bubble line with no caps. So it's very difficult. They're also giving you credit on your participation payments. So the UK makes it very lucrative to bring a large tenfold project to the uk. You're going to get all your talent costs and any sort of participations you're paying after the fact. It's hard to compete with that.

[Matt Bellany]

Yeah. I have said some stuff on the show in the past about the UK tax credit and I've mentioned the 40% number and I've had some pushback from people there saying maybe a couple projects qualify at 40%, but most do not. What is the nuance of the UK credit?

[Joe Quianese]

So that 40% is specific to independent film. So both the UK and Ireland now have a program specific to independent films. I can't remember the exact dollar amounts, but I believe it's anything less than 20 million pounds or less or euros or less. The UK does have other requirements. You have a UK director, producer and a screenwriter, but you will get 40%. New York has tried to compete with that. New York just set up as part of also allowing their atl. New York now has an Empire State Independent Film credit where you can also get between 30 and 40% with all your ATL qualifying.

[Matt Bellany]

Oh, wow.

[Joe Quianese]

The other big change for New York, which is huge for the independent producers, New York always had a very long tail in terms of how quickly that money came back, sometimes as long as 48 months. Under this new program, you can get the money back in the year and complete your project, which is very quickly. So that's going to be really important for the independent producer.

[Matt Bellany]

I was going to say the indies love that because it's out of pocket expenses. They're not, you know, deep pocketed studios.

[Joe Quianese]

And I think with California's change, I think California is going to become a big hub for independent film. In fact, a few weeks ago when the state announced their the latest slew of projects that they've approved of, the 48, I think 43 were independent projects in that 10 to 20 billion dollars range.

[Matt Bellany]

Hmm, interesting. Yeah, I saw that list. Widely expected that the $100 million movie is probably the Once Upon a Time in Hollywood spinoff that David Fincher is doing for Netflix. Although Netflix is not confirming that. Netflix is horrible about confirming anything involving David Fincher, who is a crazy person about what is out there about his projects. But yeah, Netflix getting a credit to shoot that one in California.

[Joe Quianese]

Right. I mean, again, I hate to keep sort of harping on the atl, but I think that's a big change that over time I hope California will.

[Matt Bellany]

Why is that such a big deal? Why? Why does the government need to give tax Credits for the exorbitant, sometimes salaries of actors and other above the line.

[Joe Quianese]

Well, it can be one a significant percentage of the budget. And as I said before, why that's important to the state is those big budget films bring along with it a huge below the line.

[Matt Bellany]

Right. So it's just a lure to get the bigger budgeted movies.

[Joe Quianese]

Correct.

[Matt Bellany]

If you are a film commissioner in Georgia, are you scared right now? They still have the uncapped incentive there. But amid this whole content recession, like how does the pecking order change right now?

[Joe Quianese]

I would say that Georgia still offers a very competitive program but in light of what New York and California have done, they now have some serious competition. The other big change that happened in California is now California is refundable. Before in California, unless you were an independent producer, you had to have an income tax or a sales tax liability in order to monetize your credit. It's now you can make the election to get that credit as a refundable tax credit. The only hiccup to that is you'll only get 90% of it and it'll be paid back over over five year period.

[Matt Bellany]

Huh. Why'd they do that?

[Joe Quianese]

There were a lot of studios, a lot of producers who weren't able to tap into the California program because they did not have an income tax or a sales tax liability. So you're going to see a lot more players now that couldn't produce in California start producing here.

[Matt Bellany]

Well that's the thing about this and I think even people in the industry don't really understand how this works. They say they see the 750 million number and they're like oh great, my movie can just automatically get that. All we have to do is is stay in California. But that's not how it works. There is a lottery system. Well you, you explain how it works.

[Joe Quianese]

There are actually application windows. In fact one is happening right now, just started on Monday for for tv. So what they do is there is an application window right now for tv. There'll be another one in August for feature film and independent film.

[Matt Bellany]

Craig, get your application in for your coming of age story about a young boy and Steph Curry as his mentor.

[Joe Quianese]

And it used to be more like a lottery. It's not really a lottery. Right now everybody is applying at the same time. Who's producing similar type content where it becomes a bit subjective is there is a jobs ratio test that every applicant has to do. And typically when you're part of this at selection process, the projects that are showing that they're going to create or maintain the largest percentage of jobs have a higher percentage of being selected into the program.

[Matt Bellany]

And is that an objective test? Is it a straight percentage or is there some fat cat dude sitting behind a desk with a cigar stamping his favorites?

[Joe Quianese]

No, it's pretty straightforward. It's automated on the Film Commission website and you do get penalized if you put in sort of very aggressive estimates and at the end of the day you don't meet those numbers. You could get penalized and get less of percentage back. And if these are gross numbers that don't tie out at all, you can lose your entire credit. So you have to be pretty specific in terms of your estimates. The Walking Dead Dead City Now Streaming exclusively on AMC plus why do you want to bring back Manhattan?

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[Matt Bellany]

Why do you think this went through now when there have been efforts over the years to get this high of a credit scheme in place in California? I think the momentum really picked up around the fires in LA and wanting to do something for a region that had so many people hit so hard by a disaster. And I think that was a big momentum builder. And then the industry got on board and some of these studios finally showed some interest. After literally decades of doing nothing and just following the money, the local government in LA finally woke up to this issue and I think they've been asleep at the wheel for a long time. What's your sense of what the difference maker was this time?

[Joe Quianese]

I think you're right. I think fires had a lot to do with pushing this over to being approved. I think you had a lot of people that not only lost their homes but that weren't working well.

[Matt Bellany]

The content recession in general, which is independent from the fires, but post strikes and the whole industry is hurting and et cetera.

[Joe Quianese]

Yeah, but if you're, if you're in a position where you don't have a home and you're wondering where you're going to work and there's no jobs for here in California, it would be really no reason for you to stay and rebuild here. She'd probably looking elsewhere and moving to a place like Georgia or New York or wherever the work is. In fact, even Texas right now just approved more money for Texas as well. They have 300 million a year and a grant program that's offering between 25 and 31%. So they're aggressively getting into the game as well.

[Matt Bellany]

And I know New Mexico has done a lot. Netflix moved there. West coast hub there. Netflix is building in New Jersey as well. There's this whole Mark Wahlberg effort to bring productions to Nevada. Is that going anywhere? I saw Warner Brothers pulled out of that.

[Joe Quianese]

Not only that, but that bill did not pass. And in Nevada, the legislation sessions are every two years. So that two years ago it didn't pass, it didn't pass again this time around.

[Matt Bellany]

Oh, sad for Mark Wahlberg. He won't be able to drive from his compound in the desert.

[Joe Quianese]

I would say the other state, the state that is really being the most aggressive right now is New Jersey. The governor last week just made some further modifications to the program. They are in it for the long run. They definitely want to attract the larger productions. And so they've upped the the percentage for larger productions. They up the amount of money for what they call studio partners, those who have facilities in the state who plan on producing larger projects. And New Jersey continues to up their game.

[Matt Bellany]

That might get a little boost if New York City elects a democratic socialist as mayor. Has Mamdani said anything about the aggressive tax incentives to lure productions there? Is he pro or anti? I imagine he might call that corporate welfare.

[Joe Quianese]

I have not seen anything so far in terms of what he said. That's part. But at the end of the day, these are jobs.

[Matt Bellany]

Well, but the Democrats in California have come full circle on that. There were a lot of Democrats that refused to act on this issue because they called it corporate welfare and because they said, why in a state of tens of millions of people that have all kinds of industries, why should we care about this particular one and why should we subsidize it when others would love to have that kind of largesse directed towards them?

[Joe Quianese]

I guess I can't disagree with that logic. But at the end of the day.

[Matt Bellany]

In this state, I know it's a reality situation. You can stand on a soapbox and stand on your principles and great, you can feel good about yourself. But you're looking at an exodus of these jobs and these producers where other states are not saying that. And the only thing I wonder is if this isn't just a race to the bottom, like the anti production incentive people say, like where does it end? Does Georgia now get even more aggressive?

[Joe Quianese]

We'll see. I mean, I've been hearing that same line for over 20 years now. It raced to the bottom, but it continues to go up and up and up.

[Matt Bellany]

It continues to go deeper and deeper.

[Joe Quianese]

You've got 40 states where with incentives right now, over 100 countries here in the U.S. over the last five years, it's been a lot of positive legislation to keep programs going or bring back programs. In fact, Wisconsin, that had a program that they discontinued in 2013, just brought back their program. Alaska, that had a program as well, has got some pending legislation to bring back their program as well. So I think everyone's finally acknowledging that, that these are job creation acts, these are incentives actually may appear to be corporate welfare, but what they are doing is creating jobs that are mobile, that can go anywhere in the world, and they need to be incentivized to stay in the state and stay in the country.

[Matt Bellany]

And what role do these studios have? They're all based here, headquartered here. The agency's headquartered in la. The infrastructure of Hollywood is still in la, yet the studios have been the ones that have caused this. They have been the ones that have followed the money and gone elsewhere to shoot their movies with no apologies and no regret at all. Do you sense that the feeling at the studios has changed at all? Or are they just going to take whatever money they can? And if it's in California, great. If it's in the UK or Georgia, also great. There's no real incentive to build back the industry in Southern California beyond what is given to them.

[Joe Quianese]

I think there's always been an interest to keep projects here, if possible.

[Matt Bellany]

You think so? I don't. Give me an example of a movie that's shot in L. A just because it's usually either the money is incentivizing or the filmmaker or star demands it.

[Joe Quianese]

I would say it's wishful thinking. I think every time a project is greenlit, a budget is done for California, a budget's done for New York, a budget's done for Canada. A budget's done for the uk. At the end of the day, you're going to end up going to the jurisdiction that meets your creative needs and it's going to give you a subsidy that reimburses you for your cost.

[Craig Horlbeck]

Joe, is, is LA still competitive from a facilities perspective, like sound stages, post production hubs from like a volume and quality standpoint, is LA still considered a great place to shoot?

[Joe Quianese]

It is. And it continues to grow. With studios.

[Matt Bellany]

Yeah, they're empty these days.

[Joe Quianese]

Right. But there's lots of new studios being built all over and a lot of renovations happening at existing studios as well. So I think that's also part of it, is that they are rebuilding not only the incentive program, but trying to rebuild the whole infrastructure here as well.

[Matt Bellany]

One thing that is in this California bill that we didn't talk about yet and I think could be perhaps a kind of secret booster, is applying the credits to television episodes less than 20 minutes, shorter form content. And if you're looking at the growth areas for content right now, it's short form, it's professional YouTube creators and TikTok people. Are those kinds of productions going to.

[Joe Quianese]

Get tax credits down if they meet the minimum spend requirement? Which at the end of the day is as long as 75% or more of the product project is shot in the state and it's a million dollars or more spend, it should qualify.

[Matt Bellany]

So Mr. Beast doing a video at Disneyland, that would qualify.

[Joe Quianese]

Remember, we're also going to go back to unscripted doesn't qualify. So if he's producing unscripted content, it wouldn't qualify.

[Matt Bellany]

Okay, so none of these YouTube or TikTok videos qualify.

[Joe Quianese]

Right. But one thing I do want to highlight, although it hasn't happened yet, there have been multiple states that have had proposed legislation to specifically incentivize the 30 minute sitcom to bring that business from California into their states.

[Matt Bellany]

It hasn't passed well, but the 30 minute sitcom, good luck reviving that like that, that's pretty much dying on its own.

[Joe Quianese]

Well, the 30 minute format.

[Matt Bellany]

Okay, so the scripted comedy.

[Joe Quianese]

Yeah. So I think that's something that, you know, California needs to do it again to retain what it has.

[Matt Bellany]

Yeah, I mean most of the, like the CBS shows you look at like Ghosts or their new show, dmv, both of those are being shot in Montreal. I mean, they're already kind of gone. Some of them are here, some of them are, but a lot of them aren't.

[Joe Quianese]

Right. And if you bring up Canada, Canada also offers great federal and provincial incentives but one thing to highlight the Canadian incentive is only Canadian spend Canadian labor. So again, very similar to California. You're not getting your expensive actors and producers, your US Actors, producers and directors in Canada. So they're. There are other factors in Canada that make that incentive lucrative, and that is both the federal and the provincial incentive, when bundled, can give a producer in excess of 40 to 50% back on every dollar they're spending in Canada.

[Matt Bellany]

Yeah, it's pretty aggressive. The other thing is the dollar, the strength of the dollar does matter in these calculations. And like everybody I know seems to be going to Japan right now because it's so cheap to go there. And I was thinking, like, why don't studios start shooting their movies in Japan? Their money would go further.

[Joe Quianese]

Well, there is a 50% incentive in Japan.

[Matt Bellany]

That's. There you go.

[Joe Quianese]

Yeah, so I think the question is, you know, obviously finding projects that would work in Japan and also working within the infrastructure that currently exists, which over time will also develop once productions continue to come, infrastructure builds around it.

[Matt Bellany]

Five years from now, what is the impact on of this new California incentive plan? Do we see noticeable change in production? Assuming that overall production levels stay the same, maybe increase a little. How do things change over the next five years?

[Joe Quianese]

I would say given the fact that we've doubled the amount of money, almost doubled the amount of credit, we should see the amount of production in the state hopefully double.

[Matt Bellany]

Double? No, it's not going to double.

[Joe Quianese]

Well, in terms of talking about the number of jobs specifically, you think the.

[Matt Bellany]

Jobs are going to double?

[Joe Quianese]

Well, there've been some numbers thrown around in terms of what this program would bring. In terms of jobs. I can't remember the figures, but I think we're going to see increased jobs because there's obviously going to be increased production spend in the state.

[Matt Bellany]

I don't see Marvel moving back from Georgia. I just don't. I mean, do you think that's going to happen or from the UK for some of these bigger movies? I feel like the infrastructure is so strong there, they're still getting the credits. Maybe California is better. Maybe they'll throw a bone or two if it suits the story. But I just don't see these biggest, the biggest of the big Hollywood movies coming back.

[Joe Quianese]

I would say purely based on the programs themselves, it's really hard to compete with the UK given they're offering a base credit of 25.5%, as high as 40%, the money comes back quicker. They allow ATL, they allow credit on the participation. It's hard to Very hard to compete with that. Yeah, but we're trying. We're definitely trying.

[Matt Bellany]

Okay. Well, you're somewhat more optimistic than I was. Appreciate you coming on. Thanks for the time.

[Joe Quianese]

My pleasure.

[Matt Bellany]

We are back with the call sheet. Craig, I gotta say, we've gone to a lot of premieres together now, and the Superman premiere on Tuesday night, I feel like there was a premiere. Pretty significant energy in that room. And maybe because they packed it full of influencers and nerds that were very excited. A lot of them were wearing capes that they gave out.

[Craig Horlbeck]

Calling them out as nerds. Yes, it did seem like a particularly large portion of the crowd was super fans of Superman.

[Matt Bellany]

Yes, the Chinese Theater was packed, I would say. I'm going to say it. There was a buzz. There was a buzz in that theater.

[Craig Horlbeck]

Yeah. People were asking you for photos. There was a huge buzz. Stop.

[Matt Bellany]

Yes. Two people asked me for photos. But, yeah, that notwithstanding, I will say that the movie delivered. Fans of Superman are going to like the Superman movie.

[Craig Horlbeck]

Well, that I have no idea, because the Superman super fans know so much more about, like, if this movie is authentic or if they like what James Gunn did. For me, for a very normal superhero fan, thought it was better than I expected it to be, to be honest.

[Matt Bellany]

Yeah.

[Craig Horlbeck]

I thought the two leads had great chemistry. I thought the movie was very entertaining. It's not too long. It's two hours and nine minutes.

[Matt Bellany]

I know. Huge for you.

[Craig Horlbeck]

It's huge. Maybe it felt a little crammed, a little busy, but I thought it was pretty entertaining and I enjoyed it.

[Matt Bellany]

Yeah, it was interesting to see all the executives there because they are so nervous about this movie.

[Craig Horlbeck]

A lot of pressure on this movie.

[Matt Bellany]

Yeah. I mean, James Gunn has gone on, you know, and given interviews saying, it doesn't have to do 700 million. Like, who's saying that? Yes, it does. It kind of does. It doesn't have to do 700, but it has to do, like, 6ish.

[Craig Horlbeck]

It has to be well liked. It bears the burden of launching a DC cinematic universe of superheroes.

[Matt Bellany]

And the reviews have been good. The reviews so far have been good. And I think the fans are going to like it. But there is such tremendous pressure on this. Our guy David Zaslav coming up. To me, I could tell he was a little nervous. Like, oh, what'd you think? And, like, it's good. Everybody I talk to, it's like, this is not embarrassing. It is a good movie. People are going to like it. And you know what? Good for them. Whether it's going to do you know what it needs to do? We don't know. But what I do think it's going to do is beat the tracking. The number is at 1:30 for the weekend, which is a big number. That would be pretty significant. Man of Steel did 116 in 2013. So with inflation, that's more. But you know, 11612 years ago ultimately went on to grow 670 worldwide. I don't even know if that's a comp from 12 years ago, but it is the last standalone Superman movie. The Batman. The most recent relaunch of the Batman opened to 134. So I think it's going to do what the Batman did and that would put it at the over for 1:30.

[Joe Quianese]

Yeah.

[Craig Horlbeck]

It's hard not to get caught up in the premiere buzz, but I tend to agree with you.

[Matt Bellany]

Oh, I don't have a problem with that. I am so desensitized to that. I've been to so many bad movies that everyone's raving about at the party and you're like, really? Did we, did we just watch the same movie?

[Craig Horlbeck]

But I, you know, I don't go to a ton of movies in a packed theater with people cheering. I think you get caught up in that a little bit.

[Matt Bellany]

Influencers and capes, very convincing.

[Craig Horlbeck]

But this movie is coming out a week after Jurassic Park. Do you think that's going to hurt?

[Matt Bellany]

Yeah, maybe a little. But it's a slightly different audience. It's less family. I will, I will say one thing. This movie's a little dark and kind of adult. Like there's.

[Craig Horlbeck]

Which I enjoyed.

[Matt Bellany]

I know, but like I was thinking about my 9 year old and there's some like gun stuff and, you know, hooker humor and stuff like that. I don't know. For young kids in general, I don't.

[Craig Horlbeck]

I think it's a little dark, a little edgy. Edgier than what you would expect, which I appreciated the. It's. It's very funny. I think you could take your nine year old. I don't think it's that bad.

[Matt Bellany]

Huh. Interesting.

[Craig Horlbeck]

I also don't have a child, so.

[Joe Quianese]

You do.

[Matt Bellany]

Yeah, exactly. Says the guy with no children.

[Craig Horlbeck]

Like, yeah, why not?

[Matt Bellany]

Screw it. One thing we can agree on the John and Vinny's pizza, big value add at a premiere.

[Craig Horlbeck]

Food was really good across the board.

[Matt Bellany]

All right. Over on 1:30. Do you agree?

[Craig Horlbeck]

Yeah, I think it's going to be like right around there, though. I don't think there's going to be some big surprise. It made 170, and I don't think there's going to be a huge flop. It made 102.

[Matt Bellany]

This is an aggressive number. This is the NRG number. Some of the others are elsewhere, but, you know, once you get over 100, it's a crapshoot. But I am going to take the over on 130 and we'll see how we do. All right. That's the show for today. I want to thank my guest, Joe Keonese, producer Greg Horleback, artist Jesse Lopez, and I want to thank you. We'll see you one more time this week.