Otago and Southland came third in the country for the most money spent by screen production companies for the year ending March 2010, behind Auckland and Wellington in first and second place respectively, according to a report by Statistics New Zealand.
Spending in Otago and Southland increased from $31 million in 2009 to $35 million in 2010. The number of film businesses in the South also rose, from 87 to 99.
Film New Zealand chairman Julian Grimmond, of Queenstown, said on Friday the increase in commercial production was prompted in part by the global financial crisis. Companies had stepped up marketing and advertising and the South offered some of the greatest locations in the world.
Screen production companies were coming to Otago-Southland from other parts of New Zealand, throughout Europe and Asia, India, the United States and Australia, Mr Grimmond said.
"The foreign exchange rate is not great at the moment for productions to come in here. I would say it comes down to a very agreeable regulatory environment - in other words, we're film-friendly in New Zealand and Otago and Southland, and that's thanks to the councils that are part of that and Film New Zealand driving that regulatory environment."
Southern crew members were recognised for their skills, and easy access to a variety of locations was another drawcard.
The film industry was working with the Department of Conservation to make film-making in the South easier, he said.
However, sound stages for building sets and filming in poor weather, plus ultra-fast broadband for post-production, were required to move the southern film industry forward, Mr Grimmond said.
Rental housing spokesman Brett Mills, involved in the Queenstown film industry since 1987, said it was interesting production fell but post-production increased nationally.
Mr Mills said he put increased spending by film companies in the South down to a maturing of the industry. Natural disasters in South America may also have brought North American production companies to shoot in New Zealand.
"The summer previous to last we had a boomer year because we were down at 50c [against the US dollar]. Last summer, we couldn't figure out why we were getting the work, but we were getting it, and this summer's been pretty much the same.
"When they want what we've got they come, and they come irrespective of the cost."
Production infrastructure in Queenstown had come of age and the Wakatipu offered a high-quality product, he said.
"Camera, grips, crane people, hotels, whatever. A director who's been coming here for years recently said to me Queenstown was 'turn-key' - you come into town, turn the key, start the car and away you go.
"You can fly in from anywhere in the world now, land in Queenstown and be shooting the next day."
The South in focus
While significant, Otago-Southland figures were dwarfed by New Zealand's production powerhouses in the North Island.
Screen companies in Auckland spent $541 million last year, up from $402 million in 2009, and there were 384 associated businesses last year, up from 375 in 2009.
Screen companies spent $200 million in Wellington last year, down from $323 million in 2009. However, the number of film businesses shot up to 261 last year from 192 in 2009.
Statistics New Zealand reported the value of the New Zealand film industry "held steady" for the year ending March 2010, at just under $3 billion.
The post-production sector continued to grow, while revenue from the production sector fell.
"While New Zealand is still involved in making films, the industry is increasingly specialising in post-production work," Statistics reported.
Revenue from post-production activities such as digital graphics, animation and effects, had almost doubled in value over 2009-10. At just under $600 million, post-production represented 20% of all screen industry revenue for 2010.
