Amid global competition for production business, Hollywood is hurting

As seen on NPR.

On a Hollywood backlot in Los Angeles, you can find a replica New York City street — complete with a diner, a newsstand, brownstones, a bodega and a subway entrance.

It's part of the Radford Studio Center, a sprawling production hub in Studio City. In 1928, silent film actor and director Mack Sennett built the studio on what was once a lettuce ranch. Classic TV shows Gunsmoke, Gilligan's Island and The Mary Tyler Moore Show were all made here. So was the hit 1990s TV show Seinfeld.

"This stage has a ton of positive juju," says Zach Sokoloff from Radford's soundstage nine, where Seinfeld taped. Sokoloff is senior vice president at Hackman Capital Partners, which manages Radford Studio Center and studios around the world.

Riding in a studio golf cart to the backlot, Sokoloff points out the spot where the show's famous episode "The Soup Nazi" was made.

The lot is full of recognizable Seinfeld spots: "Up there, you've got the balcony where Jerry threw the marbled rye," he says.

Sokoloff explains that the studio built this backlot for Seinfeld in 1994, after a massive 6.7 magnitude earthquake rocked Los Angeles and destroyed much of the set.

"There was trepidation about remaining in LA, so we decided to bring New York to the production, as opposed to having the production go to New York," he says.

Building a replica New York City is what it took to convince Seinfeld to stay in California, says Sokoloff. But keeping productions in the area – and even in the country – has become a challenge, at a time when film and TV production has increasingly moved elsewhere.

The issue came to national attention this month, when President Trump took to Truth Social to declare, "The movie industry in America is DYING a very fast death." He announced he would authorize a 100% tariff on movies made outside the U.S.

Trump's proclamation —  prompted by a visit from one of his "special ambassadors" to Hollywood, Jon Voight — shocked and confused film industries around the world. But the president quickly paused to consider the idea, saying he'd meet with industry leaders because he wanted "to make them happy." In the days since, Voight, and fellow "ambassador" Sylvester Stallone teamed up with the Motion Picture Association and several industry unions to craft a letter urging the president to consider enacting federal tax incentives and adjusting certain tax provisions to increase film and TV production in the United States.

The entire episode opened a conversation about the decline of TV and movie-making — and what can be done about it.

A worldwide competition for production work 

According to FilmLA, which issues film permits, production still hasn't rebounded from the COVID-19 pandemic and delays triggered by the writers and actors' strikes in 2023. Studios and streamers also aren't ordering as many shows these days.

"With less work to go around, the competition for what's left is intensified," says spokesman Philip Sokoloski.

Most states have some sort of financial incentive for productions. So do nearly 100 countries, including Canada, the U.K., Ireland and Australia.

"Even Thailand [has incentives]," says Joe Chianese, senior vice president at Entertainment Partners, a global production services company. "The recent season of The White Lotus was shot entirely in Thailand. With the number of incentives here in the U.S. and around the world, producers really have a lot of choices."

Chianese consults with producers about production laws, incentives and taxes around the world.

He says that productions can bring a lot of money to an area at once, "which is a real stimulus to the economy, creating jobs." The trend of what's known as "runaway production" began in the late 1990s, he says, when Canada introduced tax credits for film and TV production, and "you saw that rolling out in other countries."

Ever since, there's been global competition for entertainment jobs and bragging rights.

Even within the U.S., states are competing for production 

Within the U.S., states are jockeying to get those show business jobs. Last week, New York passed its budget with an $100 million increase in funds dedicated to production incentives, setting aside a total of $800 million.

This week, thanks to New Jersey's tax credits, Netflix broke ground on new soundstages, a backlot, and post-production facilities on a former U.S. Army base at Fort Monmouth.

And in Texas, a proposed state bill offering more incentives to film there has gotten a boost from some famous celebrities.

"Small fraction of the Texas budget surplus could turn this state into the new Hollywood," actor Woody Harrelson says in a recent video, teaming up with Matthew McConaughey, Billy Bob Thornton, Dennis Quaid and Renée Zellweger.

"No shade to Texas, but I think people would rather film in California," says Steven Jaworski, vice president of production for A&E Studios.

Jaworski is in charge of budgeting for the Netflix series The Lincoln Lawyer, a legal drama produced at Los Angeles Center Studios, not far from City Hall and other downtown locations where the show often shoots.

"The reality is this show could be shot anywhere," he says from the set of The Lincoln Lawyer. "LA is a character to our story … but as costs increase, whether it's inflation or even the way that the economy may be going, there may be a mandate of 'you have to cut your costs,' and the only way to keep the show going would be to relocate. It would be heartbreaking if this show had to leave."

Long before Trump's announcement, Jaworski and others were sounding the alarm about productions leaving California.

"The situation's so dire," he says, "that if something is not done this summer, I truly believe California being the entertainment capital of the world and the production capital of the world — I think that will be a thing of the past."

California needs a comeback, studio executives and grassroots groups agree

It wasn't until 2009 that California began offering tax credits to film there – and by that time, production was already moving elsewhere to take advantage of lucrative credits. The California legislation was even nicknamed "The Ugly Betty Bill" – after the hit ABC series that moved its production from California to New York for the tax credits there.

But California's existing tax credit program badly needs updating, according to Casey Bloys, the chairman and CEO of HBO and Max Content.

"The talent is here, the infrastructure is here. We have a number of shows, including Hacks, that are shooting here," he said on a panel at the Milken Institute earlier this month. "But the issue becomes, when you try to plan, you have to get into a lottery, and you're not sure your show is going to get a tax break or not."

Sony Pictures Entertainment CEO and president Ravi Ahuja also made the case for helping out the state.

"While it's true a lot of production has left the United States, it's even worse for California," he said on a panel. He and other studio executives said they like filming in LA, but also want to be able to film and shoot on location around the world.

To solve the problem, California Gov. Gavin Newsom has already been pushing to more than double California's tax credit program, and two bills going through the state legislature would expand the types of productions that are eligible for credits.

After Trump introduced the idea of movie tariffs, he blamed Newsom for allowing the Hollywood jobs to leave. Newsom stood by the program in California and the incentive increases he's already proposed. He also volunteered to help the president craft a $7.5 billion dollar federal tax credit plan. "America continues to be a film powerhouse, and California is all in to bring more production here. Building on our successful state program, we're eager to partner with the Trump administration to further strengthen domestic production and Make America Film Again," he said in a statement.

Despite the recent attention on keeping production in the country, industry leaders in California still say the program there needs help. Boosting California's budget and revising its tax credit program would offer a reward for productions made in the state, not a punishing tariff for producing outside the U.S., says Pamala Buzick Kim, co-founder of a grassroots group called Stay in LA.

The group has been lobbying for enhanced incentives to keep production in California.

"A lot of people outside of LA think that when you say Hollywood, everyone's rich," Kim says. "I wish that that was the case. But 99% of us who are in production really are your everyday working class folks."

Kim says Trump's movie tariff idea "definitely sent a spiral of confusion through the industry and through the international market, but the fact that we are getting attention at a national level is great."

Kim says it's important to preserve LA's legacy and its biggest greatest export.

"We have generations of people who have been in this business who are in this area who are the best of the best. And we need to protect that."