A study by the Australian Bureau of Statistics (ABS) has found news accounts for almost half of all locally-made television content in Australia.

The ABS study was sponsored by Screen Australia, the Federal Government's funding agency for film and television.

It monitored nearly 80,000 hours of free-to-air television and found that more than 36,000 hours was news and current affairs content.

Read the full study here.

Brian Han, a media analyst with Fat Prophets, says that is because it is a relatively cheap way to meet local content quotas.

"We do have a local content quota in Australia, and that is obviously more economically met by using current affairs instead of the more expensive local drama," he said.

The ABS says the average cost to produce an hour of news is around $14,000.

That compares to $70,000 for the average variety program, and well over $500,000 per hour for a typical drama production.

But Mr Han says popular television dramas are worth the hefty price tag, with the potential for merchandise, re-runs, DVD and overseas sales.

"A successful drama has valuable longevity and long-term monetisation potential that news and current affairs could never hope to match," he said.

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"Once news and current affairs goes to air, it sort of instantaneously becomes commodity, and competes with a countless number of other news outlets, whereas a successful drama or local production has the potential to really deliver a valuable franchise to the broadcaster."

Fiona Cameron from Screen Australia says local drama is still growing, despite its cost.

"TV drama: $168 million to $355 million. Once again, I think, recognition of that renaissance of television drama at the moment and a direct result of the producer offset," she said.

That producer offset is a Federal Government tax break for local content producers and Ms Cameron says it has also boosted local film production.

"If you take the Australian film The Great Gatsby, 40 per cent of its qualifying Australian production expenditure would be returned to the filmmaker," she said.

"The survey shows that the sector is doing really well on the back of the producer offset."

Local production sector growing

The research shows most sectors of the industry have grown over the past five years.

Overall, the income from film and TV production grew from $1.6 billion in 2006 to $2.2 billion last year, and employment also grew by almost a quarter.

"Production income, production expenses, production employment, and production businesses are up," Ms Cameron said.

Two of the biggest growth areas were news and light entertainment, which includes variety and reality shows.

"We've seen just news and current affairs rise from $412 million to $509 [million] over the five year period," she said.

"We've seen a huge jump in light entertainment, quiz, and panel programs from $318 million - this is value of production - to $555 million.

"That's a fairly huge increase, and I think it does reflect the popularity of those shows at the moment."



But there are some sectors not performing so well.

Post-production, such as visual effects and animation, was down by a quarter with the workforce in that area shrinking by a fifth in the past five years.

Despite mobile gaming being the largest growing sector amongst consumers over the survey period, Australia's video game development industry has also gone backwards.

Ms Cameron says the high Australian dollar is largely to blame.

"We had a whole host of international game developers in Australia who have now left, and what we've got left is a very small, but vibrant, independent games development sector," she said.