Hollywood embracing diversity could boost revenue by $10 billion

“Executives should aspire for even higher upside as audi­e­n­ces become more diverse and the growth in demand for diverse content far outstrips supply growth,” said the report
Black talent is underrepresented across the film and television industry, and it’s costing Hollywood billions.

So says McKinsey & Co, which found consumers might spend as much as $10 billion more, or an additional 7 per cent, if film and TV projects were more racially diverse. Black-led projects have been un­derfunded and undervalued, despite often providing a better return on investment, it said in a report on Thursday.

“Executives should aspire for even higher upside as audi­e­n­ces become more diverse and the growth in demand for diverse content far outstrips supply growth,” said the report.

Hollywood studios have for years produced films and shows that disproportionately cast White men. Netflix, the world’s biggest streaming service, is making some headway at diversifying Hollywood, but it’s still got a ways to go, particularly behind the camera. And the Hollywood Foreign Press Association, which puts on the TV awards show the Golden Globes, has been criticised for its lack of diversity.

Some progress has been made across Hollywood in recent years in terms of diversity in on-screen talent. But the prominence of some high-profile films and TV shows with Black leads doesn’t change the fact that Black talent is still largely underrepresented, according to the research.

Films with two or more Bla­ck professionals in off-screen creative roles — like producer or director — receive budgets that are over 40 per cent lower than others, McKinsey found. But those pr­o­jects make 10 per cent more in box-office revenue per dollar invested in distributing and ad­vertising than films with one or no Black crea­tive professionals.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel