Australian Cinema, Market Failure, and Cultural Cringe

The Australian film industry is unique, yet it is under-utilised. With its debut in 1906 with the production of The Story of the Kelly Gang, Australian cinema has been through many trials and tribulations. Often labelled as ‘boom or bust’, there are many significant elements that contribute to the way the industry operates in Australia. This essay will focus on the significance of market failure for Australian content, and discuss the impact of early Ozploitation and genre films on the domestic market, funding, and protection from cultural cringe.


The Story of the Kelly Gang, Directors: Charles Tait, Millard Johnson, W.A. Gibson (1906). Source.

The Australian Broadcasting Corporation (ABC) submitted a report in 2006 when the Australian Government was reviewing its support of film funding in Australia. The rationale behind this report was to bring to light the ‘cultural benefits’ that are provided to Australian audiences through viewing local content. However, the achievement of these cultural benefits is impacted due to the environment of market failure that occurs in Australia. The report from the ABC attributes this to Australia’s small population – alongside its regional diversity, overwhelming access to low-cost overseas content, and the commercial imperatives for service providers to minimise costs (Australian Broadcasting Corporation Submission to Review of Australian Government Film Funding Support, 2006, p. 2). 

However, the aforementioned shortcomings of the Australian film industry are follow-on effects from the early days of Australian cinema. Since the 1970s, Australian cinema has been ‘developed and sustained by cultural policies and public subsidy to foster “Australian stories”’ (Ryan 2014, p. 143). According to Stuart Cunningham, former board member for the Australian Film Commission (AFC), the discussions surrounding how a national cinema should work have revolved around the ‘opposition of culture and industry’ (Ryan 2014, p. 144).

The opposition of culture and industry is one of the key elements to market failure in Australia. According to Ryan (2014, p. 143) Australian film has ‘tended to emphasise “Australianness” and valued for the most part “quality” and “cultural content” over “entertainment” and “commercialism”’. Perhaps this is where the problematic state of the Australian film industry stems from. 

Since the ‘New Wave’ of Australian cinema in the 1970s, genre films have been at the front and centre of production. Genre film making has contributed significantly to Australian cinema’s ‘boom or bust’ label. Generally, genre films are associated with commercial film making and entertainment rather than making a ‘serious’ comment on what it means to be Australian. During the New Wave, the films produced traversed many genres – including horror, fantasy, period, comedy, art house, and ‘ocker’ comedy. In the early days of the New Wave, popular and successful film titles included: Picnic at Hanging Rock (1975), Mad Max (1979), and Wake in Fright (1971). However, many films produced during this time were also received as ‘culturally debased’ – particularly Ozploitation films, such as The Man from Hong Kong (1975), Long Weekend (1978), and Patrick (1978).


The Man From Hong Kong. Director: Brian Trenchard-Smith (1978) Source.

Although these films are celebrated now, there was a distaste for Ozploitation and genre films that carried over into the 1980s – especially after the introduction of the 10BA tax laws in June 1981. These laws allowed investors to claim a 150 per cent tax concession, while only paying tax on half the income earned from the investment (Screen Australia, n.d). This meant that screen producers were able to claim a production subsidy, and there was a skyrocket in the amount of private investments into film. The 10BA period saw films produced ‘for tax relief with little regard for quality’ (Ryan 2014, p. 146). Production and distribution ‘became totally divorced’ (Ryan 2014, p. 146) and films were not appreciated by Australian audiences or critics – if they even made it far enough to be released. 

As a result of this, the Australian Government’s growing concern about the increasing costs of 10BA meant that concessions were gradually reduced to 100 per cent, and were eventually closed to new applicants in July 2007 (10BA Key Statistics, n.d). By the mid-2000s the Australian film industry had come under heavy criticism, as its share in the local box office had dropped to a disappointing 1.3 per cent. The Australian film industry’s unstable boom or bust history has all lead to the current state of Australian cinema – where the funding of Australian media content isn’t protected in the domestic market, and audiences aren’t as interested in ‘home grown’ content.

Today, in order to qualify for funding, filmmakers have to pass the ‘SAC’ (Significant Australian Content) test. This test is defined as ‘a cultural test to determine whether a project has significant Australian content to qualify for an Australian tax rebate’ (Significant Australian Content, n.d). The SAC test operates off Section 376-70(1) of the Income Tax Assessment Act 1997, which states that a project is determined to have significant Australian content if it meets certain criteria, including: the subject matter, the location, nationalities and places of residence of the filmmakers, production expenditure, and ‘any other matters that we (Screen Australia) consider to be relevant’ (Significant Australian Content, n.d).

One final element to consider in regard to the problematic elements of the Australian film industry is the idea of cultural cringe – a practice in which we dismiss our culture for the fear it is inferior to others. The above guidelines by Screen Australia provide ample opportunities for cultural cringe and the over-representation of Australian culture to occur –  but the idea is almost paradoxical. On one hand, Australian media content needs to be protected and preserved, but when filmmakers are required to make their films distinctly Australian, they are not as successful.


Rabbit-Proof Fence. Director: Phillip Noyce (2002). Source.

However, examples of successful (and distinctly) Australian films include The Jammed (2007), Bran Nue Dae (2009), and Rabbit-Proof Fence (2002). These films achieve a balance between being distinctly Australian and representing Australian values in a complimentary way (thus side-stepping cultural cringe) and still holding a universal appeal for both domestic and international audiences – which in turn, protects Australian content.

In conclusion, it is evident that the Australian film industry, despite its successes, also has its issues. With a paradoxical problem of both protecting and over-representing Australian content to gain funding and audience approval, it appears that over the years of Australian cinema there has been a disconnect between arts and policy. Australian cinema has all the tools to be great, and has proved that in the past, but there needs to be a better relationship between policy makers, audiences, and filmmakers.




Australian Broadcasting Corporation 2006, Australian Broadcasting Corporation Submission to Review of Australian Government Film Funding Support, viewed 8 August 2018, <>

Ryan, M D 2014, ‘A silver bullet for Australian cinema? Genre movies and the audience debate’ Studies in Australasian Cinema, vol. 6, no. 2, pp. 142 – 146 <>

Screen Australia n.d, 10BA Key Statistics, viewed 15 August 2018, <>

Screen Australia n.d, Significant Australian Content, viewed 15 August 2018 <>


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