03 May Interview with Csaba Káel, Head of the National Film Institute of Hungary
BF: Hungary’s unique shooting locations, local creative talent, high-profile studios and 30% tax-rebate have been attracting filmmakers from all around the world. How would you describe Hungary’s unique attributes and competitive advantages as a filming location? How does it stand out compared to other filming locations?
Csaba Káel: Films, music and arts, such as painting, are very much rooted in Hungarians’ DNA. Hungary has hosted a professional movie industry for 122 years now. Some prominent filmmakers left Hungary at the beginning of the last century, and two of them were studio founders in Hollywood: Mr. William Fox, who founded Fox Film Corporation, and Mr. Zukor, who founded Paramount Pictures. We also had big talents who were well-known in the U.S. Bela Lugosi, who is remembered for his roles in early horror movies, such as Dracula and Son of Frankenstein, was also Hungarian. Miklós Rózsa was a film music composer, Zsa Zsa Gabor, a famous actress, Michael Curtiz, a director who started his career here with silent movies and then became famous in the U.S. with Casablanca; and there were many others.
Hungary is in the middle of Europe and was part of the Austro-Hungarian Empire with very strong connections with central European countries like Germany, Austria, Italy and others. Hungary and especially Budapest is unique, being a local cosmopolitan city. New York is a world cosmopolitan city, but Budapest is a peculiar cultural metropolis of the central European region: here you can feel influence from the Balkans, from Germany or from Italy. That’s why it’s so special, and the people who arrive from the film business like to be here. It’s a very safe and livable city because it’s not so big. It has the same dimensions as Vienna and has 1.7 million inhabitants. This is very important for the world stars who stay in the center of the city, as they can arrive to the filming location and the set in 20 minutes. You can reach the sets easily on the M0 highway, which is a ring road around Budapest. We built our studios around that: one of them is a state-owned studio — our National Film Studio in Fót — the others are private studios. Geographically it has a very good position because it’s near the city center.
Besides, Budapest is a cultural hub. Earlier in time this side of the Iron Curtain was not very appealing. In the beginning of the 20th century, Budapest was one of the first six European cities. Nowadays, we have a wonderful cultural system: opera, theaters, concert halls, museums, galleries, and we have a very fine food and wine culture, and a special brandy, Palinka. And of course, there are also very good economic reasons, with a tax rebate system.
BF: What are some of the most noticeable achievements and some of the landmark events or productions that have taken place in Hungary so far that you are particularly proud of?
Csaba Káel: Dune is one of the last ones, and a very good story! On March 11th 2020, the Hungarian government decided to close everything due to the COVID-19 situation. But we opposed the closure of the film business in Hungary, and we pushed the government to bypass the restrictions and create a very special law to let in the first step of productions, the preparation of productions, the set design, etc. The crew of Dune left Hungary, but we called them back and we sent messages and advertisements through Hollywood Reporter and Variety that we’re not closing. But then the United States also closed. In the middle of summer, Dune decided to come back; they made the movie and it won six Oscars.
They were very thankful and grateful that we didn’t close, and they could continue the shooting. They made wonderful scenes from here. It’s a movie with modern architecture and fantasy. This was made by the design of the production set designers, created here in Hungary, because we have another other specialty, which is very important: we have trained and very talented professionals for all the phases and fields of the film production, to make the sets or the costumes for instance, and we have the knowledge in the industry coming from the fine arts, from music, from theaters. Our specialists are very professional, and people like to work with them. Ridley Scott shot here three times: he shot The Martian, and in the Müpa building he shot the Chinese airspace; we have an old train on the back which looks like an old Chinese train, which they used. I met with him, and he said it’s really good to shoot here because the people are very warm, friendly and professional. This is one of our secrets! Big movies are being shot here, with the biggest production companies, and mini-series, too with Netflix, Amazon, or HBO as well as the big studios.
BF: The National Film Institute (NFI) was only recently created in 2020 during the pandemic. You are responsible for providing financial and professional support for script development, pre-production and production of feature films, documentaries, animations, and TV shows. Can you give us a quick overview of NFI? How are you supporting the sector? How would you assess your impact in the last two years since it was created?
Csaba Káel: Up until 1989, we had a socialist film industry, but after the political changes, we had to figure out ourselves how we could do movies in the new system. In 1990, the British Council organized an East West producers’ seminar in London: 10 filmmakers and producers were invited from each country: Czech Republic, Poland and Hungary. Those days we had no producers because the state was the producer, but there were production people and artists. I was so lucky to be there in London at the British Council in Trafalgar Square. It took three weeks and they tried to push to our mind the knowledge of doing a western type of movie. The teachers were famous producers of that time, and there were people present from the whole British film industry, leaders of the financing banks, the legal system, the big stars, directors, and actors. At the end of the three weeks, they asked us if we learned how to create movies in the western system. Everybody said if this infrastructure moved to Hungary, Poland or Czech Republic, we would do that Western type of movie. But we knew that to have that infrastructure was not possible.
It took us 30 years to fully reform the film industry, to create the infrastructure. This was a big help when we started to make the service productions to the big studios, because we learned a lot of this Western kind of production. What was more difficult was figuring out the Hungarian film managing method. We funded a national film fund in order to collect a certain amount of money guaranteed by the government to start to finance certain productions. The next step would be developing the infrastructure of the film business and so on. It was really interesting because it was done in parallel by both the government and the private sector. When I came, I saw there were two kinds of film business: one financed by the government, and the other financed by the private sector, but it is the same, because the people who are working in it are the same people. Of course, above the line, people worked mainly in Hungary and directed Hungarian movies, and the American and other kinds of international movies with international, but below the line, people are the same. There are 20,000 people here in Hungary working in the film industry.
State financing is inevitable because Hungary is small; it’s not a big market. Every European country has subsidies by the government. The French film business is the happiest, but in France, there are 65 million people; it’s a big country. My plan was to have both directions in one company. That’s why we founded the National Film Institute on the 1st of January 2020. It was a very interesting moment, because a few months later, we had to step in to help the private side due to COVID-19 and the Hungarian side because we didn’t want to stop. We believed that if we were doing this special COVID-19 system, we would survive. We also figured out that this was the perfect time to develop our studios, because at present, Budapest is the second biggest film hub in Europe after London. Previously, there were not enough studios, but now we have five bigger studios here. We decided to develop our state studios, Mafilm — which was the old name of the Hungarian socialist film business — at Fót. Now we are building four big sound studios — before, we had 2 smaller studio buildings there — and it’s quite impressive. It is 10,000 square meters, and we are developing the infrastructure of the whole basis. Every big production had outside sets. Right now we are hosting a special city, which has recreated a part of Notre Dame, a Midwest American street, and an old Hungarian castle. We also have a big water tank. Blade Runner was shot there.
We started to design development. The government agreed to secure financing for us because the Hungarian and the international film business needed more soundstages, and you can make a good business balance to have money from the big productions to help younger productions in this manner. Next year, we will be ready with the new studios.
BF: In Hungary, the NFI may finance one third of a coproduction budget, to which the Hungarian state can add 30% of the overall production spending in tax rebates. Could you share some details about the incentives in place to attract film makers? How does this scheme work, and how competitive does this make the local industry?
Csaba Káel: The tax rebate is very important. Every European country has the same, but our tax incentive granted is one of the strongest in Europe. We also have a strong industry knowledge, the special geographical position, and good specialists. Altogether, this is opening our doors to the big productions. The National Film Institute took over the Hungarian National Film Fund, and we are working as a film fund for the Hungarian productions.
We have to open our minds and our practice toward co-productions because the income will be higher if international productions have money for co-production projects. A more important reason is distribution: if you’re making a Hungarian film, in the Hungarian language, it’s quite difficult to sell. But if there is a coproduction movie, there is a partner, and their interest is to push this to the market. In co-productions we are doing movies not only for the Hungarian market, which is 15 million people, but also for the partner’s market; so if it’s France, it’s 65 million more people, if it’s Italy, that’s 60 million more, or Polish, it would be 40 million more people. We can reach bigger distribution markets. That’s why the pandemic period has been interesting for us: a few projects that couldn’t finish the productions were here. We offered to make co-productions, and we made 10 co-production movies in the COVID-19 period.
BF: If we speak about the talent of local creatives, what projects do you have underway, perhaps in collaboration with film schools, to raise the next generation of film talent or industry talent at large?
Csaba Káel: While it’s important to have good studio capacity, it’s equally important to have talents and crews who can work in these studios. In the National Film Institute, we have a special program to train young talents, and have strong connections with the film schools. This is one of our secrets, to prepare new people for the industry.
We have two business lines: one is the movie productions and the other the non-movie productions (television films, documentaries, animation and miniseries). We are not supporting realities, only dramatic mini-series. Our department, the Hungarian film lab, is one of the strongest analog labs in Europe. Of course, we also have a digital side, but the analog film labs became very fashionable again. A lot of movies that were shot in digital are being copied back to film, because the film, for 125 years, is a good material to save the content. But who knows what will happen in the digital world. We have a wonderful film archive, which is the biggest in central Europe. We are reconstructing and renewing the old Hungarian film copies. This is why we can find old Michel Curtiz movies from the silent age. We have a wonderful festival, the Budapest Classical Film Marathon. It’s a festival only for classical movies. It’s a huge success here.
BF: What is your strategy for growth going forward? Where would you like to see the industry in five years? What are some of the key projects that you’re working on?
Csaba Káel: Competition in Europe is very strong in the film business. It was very difficult to reach the second position after London and to keep it. That’s why the studio development is important; that’s why new technologies, digital, even in the post-production, is very important.
We would like to enforce the post-production scene in Hungary because, typically, international productions start shooting here, then they pack and leave. Nowadays, post-production can be made anywhere, via internet connection, and we would like to emphasize that. Also, the sound in post-production is important. Hungary offers enormous musical opportunities: we have eight symphony orchestras in Budapest, when in London, there are only six. There are wonderful musical opportunities to make music for films. This is also a very important field with very talented creatives, composers and music writers.
We would like to expand also in the rest of Hungary, outside of Budapest. Hungary offers beautiful nature and a strong historical heritage, with plenty of castles which are great for shooting. You can find an English type, a Hungarian type or a French type of castle. What is very funny is you can shoot a desert scape here, although it’s not the Sahara, of course. We have wonderful forests and lakes; it’s a very rich and diverse country. I would like to push the big productions to use that.
BF: There is fierce competition in the sector from all kinds of countries. What is your strategy from a marketing communication perspective? What is your strategy to really showcase and raise better awareness of the industry globally?
Csaba Káel: The best marketing is always the productions communicating it to each other. But somehow, we have to help them to reach this experience in shooting. One of the main reasons is the economic one: how can they do good productions with talented people for good money. This may sound simple at first, but what is also important is that we have a strong guarantee for the tax rebate. Last year we had a record of $650,000 in the production spent. That’s a 30% increase. We count, by the ongoing production spent, the rebate. There is a small exception: we are paying a certain amount of the other part of the budget that is not in Hungary. This is helping the productions.
BF: What would be your final message about Hungary from a film perspective? What kind of film opportunities and what kind of partnership opportunities can we find here?
Csaba Káel: We are lucky because the California Film Commissioner, Colleen Bell, who was the ambassador of the United States, and previously a TV series producer, is an old friend of mine. We have very good connection, and we are thinking about how we can collaborate in the field of service works. We would like to make more connections and use the special knowledge we have in Hungary. We have a lot of very famous Hungarians who are interesting in the United States because they live there or became famous in the United States, but they have origin; we have special stories and I believe these are interesting.
We would like to use our creativeness in the field of collaborations. I would like to invite American producers to collaborate because Americans also have a wonderful DNA in the field of movies. This is the way!