The total gross ’99 revenue of U.S. companies in the TV commercial production equipment rental and stage facility business is estimated to be some $205 million, according to the second annual survey done on behalf of the Association of Independent Commercial Producers (AICP) and the Production Equipment Rental Association (PERA). The survey of rental houses and stages throughout the country was conducted by Minneapolis-based research firm Strategic Resource Partners, and underwritten by iNTELEFILM, the publicly held Minneapolis firm that maintains a family of commercial production and ad industry service companies.
The $205 million tally represents a nearly 5.7 percent increase over ’98 revenue, which the inaugural AICP/PERA study pegged at $194 million. The increase in overall revenue may be partially explained by a survey change. The ’98 survey limited activity to jobs for which the respondent company was the primary supplier. The ’99 survey was amended to also include spots for which the company served as a key supplier.
Even with the changed methodology, the overall gain in revenue represented "a pleasant surprise," said Ed Clare, president/ executive director of PERA, which has more than 200 member rental companies worldwide.
"Considering the issue of runaway production and other factors, the finding that there was an overall increase in ’99 is encouraging-particularly when you realize that many of our members have told me that there continues to be a significant amount of price pressure being put on rental houses, translating into softened prices," explained Clare. "Being able to realize an increase in revenue with softer prices indicates that more work was done last year [as compared to ’98]."
Rental activity in Los Angeles was less in ’99 than in ’98, according to survey participants. In ’98, Los Angeles accounted for 43 percent of the revenue generated by equipment and stage rentals nationally. This past year, that dropped to 25 percent. All other geographic regions increased their rental business, with significant growth in the Northeast U.S. from 10 percent in A98 to 20 percent in ’99.
Clare observed that some might erroneously attribute the percentage decline in Los Angeles to runaway production. "It [runaway] might have been a small factor, but the fact is that the EIDC [the Entertainment Industry Development Corp., which oversees the Los Angeles County/City Film Office] reported a fairly busy year in terms of film permitting for commercials," related Clare. "I think the decrease [in Los Angeles’ share of rental business] can be attributed to other regions of the country simply doing better. Also as commercial producers point out, they frequently work with grip and gaffer owner/operators in L.A. who have their own equipment-meaning some of the lighting and other equipment for those jobs doesn’t come from rental companies."
