Commercial success is to be desired but let's keep inventiveness as our aim

British film-making earned the right to call itself an industry in the Forties with producers such as Rank and Korda and directors such as Alfred Hitchcock, David Lean and Michael Powell.

Despite its becoming a misnomer, we still call the relatively small output of films on this island in modern times an "industry". And why not? Even if the quantity doesn't justify it, the quality certainly does.

Continuing on from that so-called "golden age" of British cinema 70 years ago, we have managed to produce memorable films, not least because we have also nurtured superbly talented actors, directors and technicians.

That was proved again yesterday by the publication of the shortlist for the Evening Standard British Film Awards. It is also the reason why, even though Hollywood might have the money, it so often comes shopping on this side of the Atlantic to dip into our seemingly bottomless talent pool.

We also retain the capability of surprising the Californian movie moguls with home-grown products.

Though I fear we could be in danger of investing The King's Speech with a little too much kudos - it's good but not that good - it certainly shows the Americans we can do feel-good schmaltz as well as they can.

Nor should we lose sight of the fact that more challenging and thoughtful home-grown films such as We Must Talk About Kevin and Shame, illustrate a commitment to serious celluloid content.

In the former case, BBC Films did require American backing. Shame, co-produced by Film4, relied on support from the UK-Australian outfit, See-Saw Films (which also produced The King's Speech).

These examples show just how much British film-making relies on the contribution of the BBC and Channel 4. No wonder one recommendation of the government-commissioned review into the "industry" was a polite invitation to ITV and Sky to follow the lead of their broadcasting rivals by investing in films. That was just one of 56 proposals made in an upbeat report, "A future for British film - It begins with the audience". It noted that UK audiences see too few British films, revealing that between 2001 and 2010 independent British films accounted for only 5.5% of the box office.

What they did see was good, very good, it suggested, but there was a way to improve output, through a series of reforms. It advocated a new programme to introduce film education into schools, the foundation of an annual "British film week" and the introduction of financial incentives to encourage collaborations between producers and distributors at the initial stages of financing a project.

The review, chaired by Chris, Lord Smith, was greeted with a measure of enthusiasm by the man who commissioned it, Culture Minister, Ed Vaizey.

Now he needs to have a word with his boss.

Prime Minister David Cameron probably meant well in a speech last week in which he suggested that the public funding of film should be spent on making "commercially successful pictures which rival the quality and impact of the best international productions". That was, however, misguided. It made him sound like a philistine and I am pretty sure he is not. Creative media do not work that way. Indeed, the one good reason "industry" is so irrelevant as a description is that even Hollywood studios - not known for their dislike of commercial success - stopped factory-style film-making long ago.

One of things that has made British movies so interesting and successful down the years has been the willingness to eschew the Hollywood formula. As Lord Smith's report made clear, it is important to produce a wide range of films "from the overtly commercial to the overtly arty".

It is virtually impossible to predict what will be a hit movie in advance. Did anyone imagine The Full Monty would take America by storm in 1997? It was both a success with the critics and with audiences across the world, taking more than £165 million at the box office after costing just £2.5 million to make.

Similarly, The King's Speech was made on a small budget, about £8 million, and has taken £250 million to date. We want to emulate those hits, and if Lord's Smith's report is implemented it could well help. But please don't stop us from experimenting too.

Roy Greenslade is Professor of Journalism, City University London and writes a blog for the Guardian