What Happened to Australian Cinema?

The history of Australian cinema is often characterized by 'boom and bust' cycles, beginning with the production of The Story of the Kelly Gang in 1906, arguably the world's first feature film. A significant renaissance occurred in the 1970s and 1980s, known as the Australian New Wave, largely fueled by robust government support. Prime Minister John Gorton initiated several avenues of government support from 1968 to 1971, establishing bodies like the Australian Film Development Corporation (AFDC) and the Australian Film, Television and Radio School (AFTRS). This was continued by the Gough Whitlam government, leading to the creation of the South Australian Film Corporation in 1972 and the Australian Film Commission (AFC) in 1975, which funded and produced internationally competitive films.

The 1980s saw an increase in private financing due to tax incentives, particularly the 10BA scheme, which encouraged over $1.5 billion in investment by 1988. However, direct government support, primarily from the Film Finance Corporation (FFC), became dominant again in the 1990s. A major turning point arrived in 2008 with the consolidation of the FFC, AFC, and Film Australia into Screen Australia, which became the primary source of direct government financing and industry development.

The 2010s brought new challenges, particularly with the rise of global streaming services and changing audience consumption habits. While streaming offered new distribution avenues and financial opportunities, it also led to a decline in traditional cinema attendance and created competition for local content. The COVID-19 pandemic further disrupted the industry, causing a significant slump in production in 2020 and impacting box office performance.

As of 2026, the Australian cinema landscape is undergoing significant shifts. The Australian Government has implemented new policies to support the sector, including the removal of the 'above the line' cap from the Producer Offset and an increase in the Location Offset to 30% for projects starting principal photography from July 2023. The 2024-25 Federal Budget allocated $14.5 million to support Australian children's screen content and $9.3 million to enhance the National Film and Sound Archive. A critical development is the Streaming Content Requirement Bill 2025, which mandates major streaming platforms to invest a portion of their Australian revenue (10% of total Australian expenditure or 7.5% of total revenue) into qualifying Australian content, a move welcomed by producers despite uncertainties about its impact on feature films.

Recent data indicates a positive trend in theatrical exhibition. After years of decline in 2024 and 2025, Australian box office attendance showed a clear lift in early 2026, running 12.5% ahead of 2025 levels. By July 2026, the Australian box office achieved a historic milestone, surpassing $100 million in revenue for three consecutive months (April, May, June 2026), driven by successful film releases and a 16% year-on-year increase in admissions in the first half of 2026. This recovery is partly attributed to younger audiences returning to cinemas, seeking immersive experiences that cannot be replicated at home, and a more disciplined approach by streaming platforms prioritizing theatrical releases. However, a Screen Australia and Olsberg SPI report released in April 2026 identified ongoing challenges, including skills gaps (e.g., 2D/3D animators, line producers), infrastructure constraints (lack of shared workspaces, physical facilities), limited career progression, and issues with business scalability. Screen Australia continues to evolve its funding programs, adopting a platform-agnostic approach from July 2025 to support diverse narrative content and foster a sustainable industry. The industry is also exploring new technologies like virtual production and AI to enhance storytelling and production efficiency.