According to a report by RBC, the Russian film industry is facing challenges in finding domestic alternatives to imported equipment and software. The Gorky Film Studio’s accounting report for 2022 stated that 90% of the film industry relies on imported equipment, for which there are currently no domestic competitive alternatives available. With a lack of proposals from domestic companies, industry participants are resorting to purchasing equipment from abroad through so-called ‘friendly countries’, i.e. parallel imports. The process of import substitution in film production equipment and software is expected to be a long-term endeavor, lasting potentially years or even decades, according to Andrey Danilin, the General Director for Technical Issues of the Gorky Film Studio.
In addition to the equipment challenges, the film studios are also predicting a significant decline in the volume of the film market, estimating it to be around 50%. The departure of Hollywood distributors from Russia, combined with the impact of the pandemic, has resulted in a substantial decrease in box office receipts, causing further strain on the industry. However, the Ministry of Culture has reported that Russian films currently account for 79% of film distribution, and the box office earnings for domestic films in 2023 have already surpassed the annual box office of Russian cinema in the past eight years.
The difficulties in import substitution of film equipment have been acknowledged by other film studios as well. Lenfilm and the Mosfilm film concern have also highlighted the reliance on imported equipment in their annual reports. The challenges extend beyond equipment, as the software used for special effects production lacks competitive domestic alternatives. This has led some visual effects studios to relocate abroad, while those remaining in Russia are facing difficulties in accessing certain software. Additionally, the departure of Adobe from the Russian market has posed further challenges for the film and music industry in terms of software availability.