By coinnews 
00:00 Seana Smith
President Trump posting on Truth Social that he wants films produced internationally to face a 100% tariff in an aim to encourage more production here in the United States. But that could impact some of Hollywood’s biggest blockbusters. Joining us now to break down what this would mean for the industry, we have Yahoo Finance Senior Reporter Alexandra Canal. Allie, I knew you were going to be all over this story when it broke this morning. How are you thinking about this?
00:26 Alexandra Canal
Yeah. Yeah. So if you take a look across the board for these media companies, Netflix and then your more traditional studios like Disney, Paramount, Warner Brothers, they initially sold off on the news. We are off of those session lows. Netflix still leading those declines there. But I did speak earlier this morning with a veteran film producer, and she told me that the proposed tariffs were quote insane and devastating. That’s how she described it. She said it doesn’t make any logical sense. If you know how the film business works, that any type of tariff in this way would be beneficial because films are financed, produced, shot, distributed, edited all over the world, not just in the United States. And if films are forced to be made here, the pricing of labor, goods, services, that’s all going to go up. Production budgets are going to increase, and that’s going to crush your smaller mid-tier films. So think those independent films. And then you look at the ripple effects that extend beyond just the studio themselves. It impacts everyone from writers to crew, to transportation to those catering businesses that support these film sets. And this is coming at a time where the industry is still grappling with the COVID pandemic, the aftershocks of that, the aftershocks of the writers and actors strikes. So there’s a lot of volatility already in this industry. And really what you need here in the US are those tax incentives. And currently US tax incentives, they fall short for what’s needed to offset the costs of some of these domestic only productions. So without significant federal support, this is not going to be realistic. And if you take a look at just some of the films that are currently or recently have been produced or filmed overseas, you have some big budget titles. Marvel’s Avengers Doom’s Day, Spiderman Brand New Day, both were shot in London. You have 20th Century Studios Avatar Fire and Ash, that’s produced in New Zealand. Paramount’s Mission Impossible, that’s a high profile film that’s coming out. It was filmed all over the world. So this is something that we’ve been, you know, wondering what the impact is going to be long term. There’s a lot of question marks here. We did speak with a media analyst earlier this morning, and he talked a little bit about the retaliatory impact. Let’s listen to what he had to say.
03:25 Speaker A
The companies do go outside the US to do a lot of film production, and if there really were tariffs, it would be something for them to consider. They could always move back into the US. Uh, I think if Trump wants to go down that road though, then you do risk of having other countries tax US films coming into their markets, which is something I think Hollywood really wouldn’t want.
04:02 Alexandra Canal
Right, so if these foreign countries end up doing their own tariffs on our imports, what is that going to ultimately look like? And that could be devastating for the entire industry. So that’s what my sources are telling me. It seems like, again, though, there’s a lot of lack of clarity, I would say, on ultimately how this would be implemented, rolled out, which companies would be most effective. But Netflix, in particular, makes roughly most of its films overseas. They have that localized content strategy, film content for the company. It counts for roughly 25 to 30% of total viewership on the platform as of 2024. So just something to keep an eye on when we think about all these media stocks.