California, Hollywood at a Crossroads

California, Hollywood at a Crossroads

Andy Marken September 3, 2026

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I'm doing everything alone. Crossing roads alone. Seeing the Eiffel Tower alone. Fighting muggers alone. - Rani, Queen , Phantom Films

We've been thinking about the state of the M&E industry quite a bit lately and more importantly, the roles California and Hollywood will play in its growth and prosperity.

We've lived in California nearly all of our adult life, working on the technology underpinnings of the industry nearly all this time and closely involved at all levels with folks who bring story ideas to life.

Yes, there are a lot of things about the state that makes it a prime industry location - great vibes, Mediterranean climate, outdoor lifestyle, and a fantastic diverse culture.

Then there's Hollywood, a place that was built on making the industry feel grand, historical and extremely important.

Movies like La La Land, a tale about chasing the beauty of art and falling in love under the California sun or Once Upon a Time in Hollywood that turned history into a marvelous fairytale.

Look behind the storylines and it's expensive to live here - seriously expensive - taxes are high and there are a myriad of regulations - state, county, local - that make things difficult to get stuff done-especially for the industry that has the creative ability to make anyplace look like somewhere else.

We were thinking about this and the cockfight posturing between WarnerMount and legislative groups at all levels.

Early on, David Ellison, as the merger worked itself through governmental approvals around the globe emphasized his commitment to the company's hometown saying, I believe in Hollywood, I believe in the future of Hollywood, my future is here.

Source - Universal Pictures

The merger has signoffs from governments around the globe. Well everywhere but California. The state's attorney general, Ron Bonta, and area officials claim Ellison has suddenly made a flip-flop and would move his company out of California, insinuating it was a hollow threat.

But is it?

The state already has the unenviable business reputation of ABC (Anywhere but California) which has been one of the reasons more than eight of the Fortune 500 companies including Chevron, Charles Schwab, Tesla, Yamaha Motors and Ellison's father's company Oracle to relocate their headquarters out of state.

Source - Cast and Crew Entertainment Services

There are already 38 states that are eager to attract film and show work to their state and the other 12 could probably cook something up to make it inviting for a big industry fish like WarnerMount to be landed.

And if not the whole enchilada, at least a few projects.

Part of his objection to the Warner/Paramount merger is that it will result in the loss of businesses and jobs in the state. But that's been going on for years.

There is a massive network of businesses, organizations and people who are needed to help turn movie, show and commercial production ideas into fantastic shows/movies/stuff people watch.

Camera/lighting houses; prop/wardrobe houses; stages/studios; caterers/security services and hundreds of more have felt the brutal impact of films/shows moving elsewhere in the country and beyond.

And that doesn't even include the thousands of stunt, safety, background actors, writers, tradecraft persons, and others who chase every whisper of a project that might last a week, a month or if they're lucky, three-six months.

Yes, it's been a tough couple of years for people in one of the toughest, most competitive industries in the world that chases the illusive likes/dislikes of people around the globe.

And it's being done in the most challenging, expensive parts of the US.While there are 10s of thousands of sq ft of vacant studio spaces in the LA area, organizations like Netflix, Lionsgate, Amazon, and others are building new, large, state-of-the art facilities in New York, New Jersey, New Mexico, Texas, Georgia, Louisiana and other states.

Source - Warner Bros.

All of these states and local governments have offered a wide range of tax credits, cash rebates, incentives, grants, sales tax waivers, free locations and most of all, they minimize/streamline paperwork requirements.

They make the teams know they are welcome and appreciated because they bring work for locals and income to the state/local economy.

The (relatively) weak Canadian dollar, close proximity, common language, extensive production facilities, highly trained/skilled professional folks and incentives have made Canada one of the most cost-effective film/show production centers for US -based film and streaming projects.

Vancouver, Toronto and Montreal offer mind-blowing digital and physical production facilities as well as teams of experienced local crews to handle a broad range of creative requirements.

Their FX activities are among the finest anywhere.

Tax credits are available from federal, provincial and local jurisdictions as well as stacking guidance to optimize financial production assistance.In conjunction with countries professional organizations, the federal and provincial governments continually carry out basic education through advanced education programs for people in all areas of film/show development, production and post technologies.

Source - Luminate

Hollywood doesn't just compete for film/show production budgets with other states and Canada, but increasingly around the world.

Almost every country around the globe has leveled the playing field as they bid for production budgets which are projected to reach $297B this year and $384B by 2030.

Source - Olberg SPI

Federal governments, states/provinces and cities/communities have steadily built out state-of-the-art studios and production facilities to attract content production to their

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