Disney has axed plans to make The Lion, The Witch and The Wardrobe sequel in New Zealand, wasting pre-production work and potentially leaving about 200 crew jobless.
And New Zealanders have been warned they must lift their game if they want to keep their edge in the film industry.
The Andrew Adamson-directed Prince Caspian was set to be based in New Zealand.
But Walt Disney International president Andy Bird has announced that the film, which it is making with Walden Media, will be shot entirely at Britain's Pinewood Studios, including all the post-production work, The Times reported.
Mr Bird, a Briton, said that the United States media giant was determined to shoot in Britain as part of its policy of localising its image by basing productions away from America, the newspaper reported.
Pre-production work on the Chronicles of Narnia sequel - with a reported budget of $300 million - was already well under way in New Zealand.
Weta Workshop was also reported to be doing the film's special effects.
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The five-week shoot alone was understood to be worth at least $10 million to New Zealand's industry.
Neither Adamson nor Prince Caspian's producer, fellow Kiwi Tim Coddington, returned calls last night.
However, one industry source said there was a possibility some minor location filming could still be done in New Zealand.
The film's departure casts doubts on Walden Media's future in New Zealand - it has made Waterhorse and Bridge to Terabithia here in the past year alone.
The decision also highlights the increasing competition among countries trying to score studio shoots. New Zealand Screen Council executive director Tim Thorpe said the country had to lift its game if it did not want to be left behind with countries such as the United States, Australia and Canada all upping their offerings to studios through incentives and tax breaks. "We're a small player, we have punched above our weight."
The Times reported that Britain's new film tax incentives, introduced by Chancellor of the Exchequer Gordon Brown and due to take effect from next year, had played a key role in luring the studio.
Prince Caspian's makers were considering New Zealand, the Czech Republic and Ireland as locations for the film.
Despite its budget, it is unlikely Prince Caspian would have qualified for a 12.5 per cent rebate through the Large Budget Screen Production Grant scheme, because an overseas studio needed to spend more than $50 million in New Zealand if it was not shooting the entire film here.
Mr Thorpe said Disney was obviously taking advantage of the new tax opportunity.
There was no doubt the grants scheme, which saw nearly $50 million returned from King Kong, had helped lure big studios, he said.
The council recommended last year that the grant's scope be widened, including lowering its threshold.
"The Government, when we made those recommendations, chose not to take any of them on board at that time, but I understand that next year they will be looking at (it) again."
Disney pulls Narnia out of New Zealand
Disney pulls Narnia out of New Zealand
http://www.stuff.co.nz/stuff/0,2106,389 ... 60,00.html
The Vinyamars on Stage! This time at Bag End
