Spotlight: Hungary

"Chameleon"

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It was 2001 and Gabor Kalomista, president of the Hungarian Producers Assn., had just submitted his movie "Blind Guys" to a prestigious international festival. When fest organizers asked about its budget and learned it was fairly small, Kalomista was told the fest would not screen "low-budget films."

"We had to come up with something pretty quickly, so we said that someone had accidentally left a zero off the end of the budget amount," recalls Kalomista, "They let the film in after that, and it won quite an important award."

While it may not garner headlines, Hungarian film has made a significant contribution to world cinema -- including Hollywood -- since its first venture, Bela Zsitovsky's "The Dance" (1901). Its history ranges from golden age producer Alexander Korda and director Michael Curtiz ("Casablanca"); through filmmakers like Miklos Jancso, Marta Meszaros and Istvan Szabo, all of whom came of age under the Communist regime of the 1960s, and two of whom (Jancso and Meszaros) have new films in the upcoming Hungarian Film Week; to such contemporary helmers as Krisztina Goda, the helmer behind Hungary's current foreign-language Oscar entry, "Chameleon."

Whether talent like this is enough to make an industry is open to debate. Andy Vajna, arguably the best-known Hungarian working in Hollywood, and the producer of such blockbusters as "Terminator Salvation," is skeptical.

"Maturing industry? I'm not sure," Vajna said. "I think Hungarian films are still looking to find their identity and style."

But Kalomista, for one, sees a more positive side.

"The Hungarian film industry is currently pretty strong," says Kalomista. "This strength has roots in our filmmaking tradition, a skilled workforce, the first tax benefit system in Europe, an ever-expanding capacity of excellent production facilities and a wonderful collection of varied locations."

Kalomista adds that development is somewhat hindered by stringent and complex state administration, but the government has promised that this situation will be eased.

Still, Hungarian film faces a number of problems, not least money. The Motion Picture Public Foundation of Hungary (MMK) is the largest state funding organization. MMK Secretary General Erzsebet Toth says that the MMK is expected to disburse 5.12 billion forints ($28,732,027) in annual support for 2010.

Despite Hungary's economic woes - it is the currently EU's most indebted member state - state funding for film production is not likely to be reduced.

"If anything, funding is likely to increase," Kalomista says. "In order to keep Hungary competitive, the government will have to increase the tax benefits - it's the only way to get more film shoots to come to Hungary."

With a typical Hungarian film budgeted from $1.5 million-$2 million, filmmakers have had to turn to TV for funding as well as the state. "There are two commercial TV channels that finance features, TV2 and RTL," says Goda. "They both give money to productions every year in exchange for television rights. 'Chameleon' was sponsored by RTL, and so was my first feature 'Just Sex and Nothing Else.'"

But more TV revenue looks shaky, given that Hungarian state-owned channels are currently on the brink of bankruptcy.

Another major challenge facing the Hungarian film industry's is a lack of transparency in local production. Kalomista says that the Hungarian Producers' Association has been lobbying the MMK to create an industry database that would profile industry players according to professional standards and record use of public funds. It would also track local box office performance, achievements at international festivals and other relevant statistics.

The Producer's Association also helped halt knockdown privatization of state-owned studios. The state had intended to offer vast production assets to private bidders for what Kalomista called "laughable" amounts of money. In 2008, the state called tenders for the privatization of Objektiv Filmstudio Kft, Budapest Filmstudio Kft and Hunnia Filmstudio Kft, which are 100% state-owned. The minimum price for Objektiv and Hunnia was 11 million forints ($58,579) and 30 million forints ($159,752) for Budapest Filmstudio.

The Association successfully challenged the privatizations and the call for bidding was withdrawn.

"The association initiated this protest, but the rest of the industry soon came to realize that such valuable assets should be considered a national treasure and not frittered away," said Kalomista. "We are convinced that such assets should remain firmly in state hands."

In terms of exhibitions, in 2008 there were a total of 180 cinemas in Hungary, with 412 screens and 80,351 seats. Thirty of these cinemas are modern multiplexes with a total of 228 screens and 43,881 seats. There were 14 cinemas in Budapest with 126 screens and 25,097 seats; the rest were outside Budapest.

The overwhelming majority of cinemas (150) are communist-era facilities with 184 screens and 36,470 seats. Some screen films once a day or only on weekends. The art cinema network, which consists of 45 cinemas with 66 screens, is entirely within this group. Most of these types of cinema have a large screening auditorium that has been divided into smaller ones or a smaller auditorium has been added. The technical development of these cinemas could only start after the Hungarian parliament passed a new law regulating the film industry.

"Cinemas in Hungary that are classified art cinemas are eligible to apply to the Ministry of Culture for a complete technical modernization if they can come up with 20% of the modernization budget," explains Edit Bakos, director of the Urania National Film Palace and president of the Hungarian Association of Art Cinemas. "This 20% is usually provided by the local city councils. Unfortunately, digital development can only be achieved with serious funding because of the lack of resources in the cinemas."

Total box office figures for 2009 were not available at press time. The latest report was a 52 week cumulative for December 1, 2008 to 30 November 30, 2009. Box office gross for this period was 9,886,609,662 HUF ($52,623,050.48) with 9,272,705 admissions sold. The market share of local films was 9.34%.

"Two or three years ago, Hungarian films attracted large audiences and at one time, four of the 10 largest box office grosses were Hungarian films," says Kalomista. "Unfortunately, that wasn't the case this year and this was partly due to the quality of the films and also poor distribution planning."

"Most films in Hungary don't attract audiences but cost the state a lot of money," adds Goda. "Hopefully, the tendency to finance so many flops will change in the near future. State funding in Eastern Europe is still very influenced by politics, which is unhealthy for the industry. This post -communist tradition will hopefully change as well."

One area where Hungary continues to thrive is as a shooting destination. Indeed, there are many reasons to shoot in Hungary -- the 20%-25% tax rebate, experienced crews, 12-hour working days in a six day work week with no overtime penalties and local rental companies for state-of-the-art production and post-production equipment.

"The Korda studio is a great stage near Budapest," says Goda. "That's where 'Hellboy 2' and parts of 'Chameleon' were shot. It's an excellent and well-equipped modern facility. There are some great post production facilities. You can find competent crews and, of course, a picturesque location - the city of Budapest. You can shoot mostly anything from period pieces to contemporary films in this diverse city."

Production services company Pioneer Pictures serviced two studio-financed films in 2009 - Miramax's political thriller "The Debt," directed by John Madden with Helen Mirren, Sam Worthington and Jessica Chastain; and "The Eagle of The Ninth," a historical epic directed by Kevin Macdonald, starring Channing Tatum, Jamie Bell and Donald Sutherland, financed by Focus Features/Universal and FilmFour.

"Both films were attracted to Hungary by the tax rebate, the relatively cost-effective production facilities and crew, the variety of location possibilities and Hungarians' professional attitude, of which I am especially proud," says Ildiko Kemeny, a producer with Pioneer Pictures.

Nevertheless, Hungary faces increasing competition from other Central European countries such as Romania.

"Romania is a fantastic example to us all, with an industry pushing extremely hard on the international front," says Kalomista. "A great deal of foreign production work is flowing into the country."

Kalomista adds that the Russian production sector is gaining strength as many have come to realize how inexpensive it can be. Hungarians are aware of this potential competition and they want a piece of the action, too. Hungarian real estate developer TriGranit is set to bid in a tender this year to build and manage Telefabrika, a project for a full service studio in St. Petersburg that would serve the TV and film industry.

Hungarian-American filmmaker Gabor Csupo (2007's "Bridge to Terabithia") shot the 2008 English-language feature film "The Secret of Moonacre" entirely in Hungary and says he would gladly shoot there again given the chance.

"The crews are very professional, the locations are gorgeous and the economics of shooting in Hungary are very enticing," he says. "You get a lot of bang for your buck - you just need to know the right people."
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