Warner Brothers threatens to move production of The Hobbit to the UK

22 October 2010

Gerard Wood

An unexpected outcome of the financial arrangement reached by Warner Brothers and MGM to finance The Hobbit movies could be that production is taken away from New Zealand and moved, most likely, to the UK.

The US$500 million deal makes this 3D two picture production the most expensive to date, exceeding the combined cost of the three Lord of the Rings movies by $215 million and costing $200 million more than the previous record holder, Pirates of the Caribbean: At World’s End. Last week's announcement of a funding deal was welcome news about a project that has been plagued by legal and financial troubles from the outset and it clears the way for filming to commence in February 2011. Unfortunately the February start date is dependent on the resolution of an industrial relations dispute between Peter Jackson's production company, Wingnut Films, and the Actors’ Equity Union in New Zealand. Or so we're told.

If only it were that simple, but as you'd expect when half a billion dollars is on the table, things are a little more complicated. The IR dispute in fact appears to be settled, or at least the Union has lifted its boycott. The Screen Actors Guild announced that "Today, our sister union New Zealand Actors Equity issued a statement recommending all international performer unions rescind their member advisories on the feature film production The Hobbit," and "In light of this recommendation, Screen Actors Guild will be alerting its members that they are now free to accept engagements, under Screen Actors Guild contract terms and conditions, on The Hobbit."

Filming we can assume will commence in February, but the issue now is not when but where filming will take place as Warner Brothers is threatening to shift production out of New Zealand. According to Peter Jackson, the Studio's confidence in the New Zealand film industry had been undermined as a result of the threat of industrial action:

"The damage inflicted on our film industry by [the actors unions] is long since done. The move has undermined Warner Brothers confidence in the industry and they are now, quite rightly, very concerned about the security of their $500 million investment. Next week Warners are coming down to New Zealand to make arrangements to move the production offshore." He concludes with understandable bitterness given the long battle to secure funding, "It appears we cannot make films in our own country even when substantial financing is available.”

Considering the success of Jackson's Rings trilogy and the important part played by New Zealand's dramatic, magical and pristine landscape, it is almost unimaginable that production would take place anywhere other than New Zealand. And yet somehow, we're told, Jackson and Company find themselves in the unthinkable position of fighting to get The Hobbit's production back in New Zealand. Wingnut Films is committed to making the films in the Land of the Long White Cloud, but the decision, says Jackson, ultimately rests with Warner Brothers. Fran Walsh, Jackson's wife and filmmaking partner, hammered another nail in the coffin when she revealed on Radio New Zealand that Warner Brothers has already identified an ideal studio in the UK, a former Rolls Royce factory now vacated by Harry Potter,  that "would be perfect for us." 

Sounds like a done deal, doesn't it?

In the war of words there's little doubt that Jackson and Walsh's statements are calculated to heighten fear, in particular amongst New Zealanders, and to turn public opinion against the Union - the filmmakers' bitterness toward the Union is obvious. And assuming Warner Brothers' threat to move production away from New Zealand is not idle, these statements are also no doubt intended to encourage the New Zealand government and other stakeholders to do their utmost to ensure that production remains where it is.

But is the threat serious?

Certainly $500 million is a sizable chunk of money by anyone's standard and it's understandable that Warner Brothers would seek to limit any perceived risk to its investment. However the Union has lifted its boycott and New Zealand otherwise has a proven record as an outstanding filmmaking environment, so why would Warner Brothers jeopardise such a highly lucrative filmmaking arrangement, especially as the Studio expects to make a significant return on its investment? After all, the Rings trilogy grossed nearly US$3 billion worldwide at the box office alone. From that perspective moving production makes little sense.

On the other hand, if Warner Brothers' threat is serious, what actually motivates the Studio to shift production away from Peter Jackson's money-making stronghold in New Zealand? Could this really be about control?

When all is said and done, the landscape of New Zealand was fundamental to the success of Jackson's Rings trilogy and it will be a crying shame if the prequel is robbed of that continuity of vision.

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