The British film industry: That sinking feeling, again

British studios are always trying to take on Hollywood ? and always failing. Filmfour is just the latest example. But, wonders Geoffrey McNab, does it have to be that way?

On an October day in 1933, Alexander Korda's costume spectacle, The Private Life Of Henry VIII, opened at the Radio City Music Hall in New York. Weeks later, a film that cost less than £100,000 to make had earned many times that much in the US alone. Korda was the trail-blazer; ever since, British film-makers have been trying to crack the American market.

It's their El Dorado, the land which will make their fortune, but many have bankrupted themselves in the attempt to get there. In the 1930s and 1940s, both Rank and Korda's American adventures ended badly. A generation later, Lew Grade and Bernie Delfont suffered enormous losses trying to set up a distribution arm in the US (Raise The Titanic was a major disaster; as Grade quipped, "It would have been cheaper to lower the Atlantic.") In the 1980s, Goldcrest went belly up with Revolution. In the late 1990s, it was PolyGram's turn to suffer. This week, as it was announced that FilmFour is facing swingeing cutbacks, the old questions about the UK film industry's relationship with Hollywood were being asked again.

In May 2000, in a move which many observers believe was ill-advised, FilmFour announced a co-production deal with Warner Bros. The pact yielded only two films, Charlotte Gray and Danny De Vito vehicle Death To Smoochy, neither successful.

"The embracing of the Hollywood way can lead to a bad end," says Stephen Woolley, producer of The Crying Game and Interview With A Vampire. "I don't necessarily think that partnering with American producers is the best thing to do. They eat you up and spit you out – that's the reality that we all know."

Doing it alone can be costly, too, however. Rank tried to spend his way into the US. In 1945, he backed the wildly extravagant film adaptation of George Bernard Shaw's Caesar and Cleopatra (1945), the most expensive British film ever made. It cost more than Gone With The Wind (1939), whose star, Vivien Leigh, had been chosen by director Gabriel Pascal to star alongside Claude Rains's Caesar. Pascal, the only film-maker trusted by Shaw to film his works, designed his own life-size sphinx and let money slip through his hands like the vast consignments of sand with which he filled Denham Studios. The film was supposed to shoot for two months, but took over two years to complete. The end result was an enormous anti-climax. "A dismal ordeal," complained critic Richard Winnington. "It cost over a million and a quarter pounds, took two and a half years to make, and well and truly bored one spectator for two and a quarter hours." The film came nowhere near to making its money back.

There are always excuses when the Brits slip up in Hollywood. In Rank's era, British film-makers blamed the protectionism of the Americans. "They are only interested in seeing their own lives on screen," Rank's second-in-command John Davis complained. "I did have the honour of seeing [MGM boss] Louis B Mayer," one of Rank's producers Hugh Stewart recently recalled. "The little bastard wandered up to me and said, 'Don't let Mr Rank wave his Union Jack at me!' There was a deliberate attempt to put British films out of business. Nothing will convince me that that wasn't so."

Speak to some of the executives involved in more recent attempts at breaking into the US market, and a deeply contradictory picture emerges. For Michael Kuhn, former boss of PolyGram (the outfit behind everything from Four Weddings and Funeral to Trainspotting and Being John Malkovich), Rank, Korda, Goldcrest et al were under-resourced even before they started, and therefore bound to fail. He refutes the notion that Hollywood is determined to keep competitors out of its market. "That's what I call the Puttnam myth – that the studios are conspiring to prevent people coming into the business. We're so below the radar. It's preposterous to suggest they even think about us!"

James Lee, former boss of Goldcrest, isn't so sure. "After 20 years of searching for the Holy Grail, I am convinced that it is simply impossible to compete against the major global distributors. It doesn't matter whether you're British, French, Spanish, Chinese or an American independent in Seattle, everyone suffers from the same problem. They simply can't get access to worldwide distribution."

But he doesn't think this is the whole problem. The irony about FilmFour, he suggests, is that unlike many of its predecessors, it was structured in a fairly sensible way. "Everybody is saying things went wrong when the Warner Bros deal was struck, but the only solution is to partner with a studio. Warner Bros was prepared to distribute FilmFour movies if they were good. They weren't. It's as simple as that."

Like Lee, Stephen Woolley (whose own company, Palace Pictures, collapsed in the early 1990s) argues that there was nothing fundamentally wrong at FilmFour. By studio standards, FilmFour's losses were minuscule. It had a bad run with the films it produced itself and those it picked up for distribution, but hardly a disastrous one. "In Hollywood, they would simply change the personnel, but here they tend to destroy the machine. It's sad that they're going to cut off the nose to spite the face."

Depending on your point of view, what is either depressing or strangely encouraging about the British film industry is that it keeps making the same mistakes. There is no shortage of new film-makers who think that they can emulate Korda's success. When one company fails, another emerges. "Anyone can call himself a producer. You can fluke your way into success and the rewards are substantial. The business will always attract people who believe they can beat the odds," says Terry Ilott, co-author of My Indecision Is Final (the book about Goldcrest.) And little has been learned since the demise of Goldcrest. "That's the nature of things – you can't stop people wanting to write or direct, and you can't stop entrepreneurs wanting to pull films together and trying to distribute them."

In hindsight, Goldcrest can be described as a successful company. It made 22 films over five years, many of which (Gandhi, The Killing Fields) stand the test of time. FilmFour's record is even stronger. As Ilott puts it, "People say Goldcrest failed, PolyGram failed, FilmFour failed. Why would you say that an enterprise [such as FilmFour] that began in 1982, had a 20-year run, delivered over 400 films into the marketplace, including some of the most memorable British films of the last 20 years, was a failure? Yes, it's run its course as a commercial venture, but I'm not sure you could say it failed."

As gloom descends again on the industry and independent producers mourn the collapse of yet another UK mini-major, Kuhn is striking a defiantly optimistic note. Pointing out that the movie business is booming worldwide – "It's going nuts!" – he refuses to abandon the idea of a major European studio as an impossible dream. Right now, he's actually trying to set something up with the help of German bankers and Fox. "What would be dispiriting is if we gave up and thought that on this side of the Atlantic, we can't set up a studio. We bloody can set up a studio and we will!"