Industry Report: Distribution and exhibition
European films can travel without becoming mainstream
by Paraskevi Karageorgu
- Three main topics were discussed at the European Audiovisual Observatory (EAO) conference at the Cannes Film Festival: How important is export to European cinema?; What makes European films travel?; and structural changes and public policy measures. Speakers this year were Stefano Massenzi, head of acquisitions and business affairs at Lucky Red (associate producer of The White Ribbon [+see also:
interview: Michael Haneke
film profile], Funny Games [+see also:
film profile] and This must be the Place [+see also:
interview: Paolo Sorrentino
film profile]), Daniela Elstner, president of the French Association des Exportateurs de Films and member of Europa International’s board, Andrew Lowe, president and director of Element Pictures (Oscar-winning films Room [+see also:
film profile] and The Lobster [+see also:
Q&A: Yorgos Lanthimos
film profile]), and Ted Hope, head of motion picture production at Amazon Studios, while the panel was moderated by Michael Gubbins, Ffilm Cymru Wales chairman and partner at SampoMedia.
The EAO presented some very interesting data, which formed the basis for the panel’s discussion. Here are some of the numbers that were highlighted: of the 1,500 films that are produced each year, one in two has at least one release outside their domestic market*. In terms of admissions 140-160 million tickets were sold outside European countries’ domestic market worldwide in 2015 (In 2014, data from China was available for the first time, which showed 50 million admissions, but only for 26 films). Over 40% of the overall total admissions to European films were actually generated outside their domestic market. As a whole, the data shows that exports are quite significant for the European film industry, but while the number of exported films has increased, the admissions have remained more or less stable, thus fragmenting the market as opposed to helping it grow. The data also shed light on the countries for which film exports are very important, revealing a huge concentration: out of the 2,800 films that are being exported every year on average, the top 100 films account for 90% of the admissions and only 26 European films manage to sell more than 1 million tickets outside of Europe, 93 sell between 100 thousand and 1 million, and the majority of films generate between 1-100 thousand admissions:
Therefore, exporting is significant on a cumulative level, but only for a comparatively small number of European films. In terms of absolute admissions, the UK and France regularly sell more than 50 million tickets outside their domestic markets; they are followed by Germany, Spain, Belgium, Sweden, Denmark, and Italy. Therefore, it is very difficult to talk about European films as a whole, when there are such large discrepancies between European countries’ film industries. However, this data only accounts for theatrical releases, and does not include DVD, TV, VoD.
The EAO also presented a very interesting portrait of the shared characteristics of successful European films. Noting that is impossible to take into account intangible values such as talent and originality, which are major driving forces behind the success of European films. According to the data, that dissected the 100 most successful European films for 2011-2014, the following are the key characteristics shared by the most successful European films:
- Budget – there is a strong correlation between the production budget and the average admissions it will generate. If a film’s aim is to sell 4 million tickets, it will need a budget of more than €10 million (based on a data from the past 5 years), which is much higher than the average European film budget;
- English language – English language films taking 90% of the admissions;
- Drama –this genre works best for European film export, representing four out of ten titles;
- Festival Awards – 70 of the top 100 European films have won awards at festivals;
- Familiar content – audiences are somewhat familiar with some cultural aspects of the story
- Co-production – 62 of the top 100 European films are produced as co-production;
- Having a sales agent;
- Having a US Distributor – which clearly has a big impact of the success of European films, with 72% of the top films that sold more than 4 million tickets, had a US distributor attached.
On the topic of the role of public policy in providing a thriving environment for European film industry, Maja Cappello, Head of the Department for Legal Information at EAO, shed light on the three most important EU policy instruments concerning the audiovisual sector: Creative Europe’s MEDIA programme (with a 2016 budget of €103.6 million), the Single Digital Market and the Audiovisual Directive. All three are aimed at assuring availability and visibility of European films. Part of the EU’s focus in achieving this is providing funding opportunities and setting up policies and good practices on a national level in areas such as film literacy, co-production, copyright, cross-border access, advertising measures, and publicity. The following two graphs by the EAO illustrate the availability and visibility of European films on VoD:
Armed with these figures and their own points of view, the panellists were faced with one of the most challenging questions for the European film industry: how can we make European films travel? For Stefano Massenzi, everything starts in the cinema and each actor in the film production chain has a responsibility to create an audience for new talents and new content. According to him, policy-makers are also responsible, as they have the power to educate the audience. He also stressed that the use of English as a key to success is a conservative idea, using the performance of French cinema as an example, given the characteristic of its language is part of its success.
As such, many things have stayed the same: the film production chain, successful branding methods and the need for companies that understand the market. However, the audience has changed: it has become more demanding, more technologically aware and is overwhelmed by choice. This beggars the question, how will the film industry manage in an overcrowded market, in which it is more and more difficult to get to the theatre? For Daniela Esthner, production companies must always be aware, and constantly analyse their films, ensuring they tackle the right topic, at the right time, as only then will people go to the cinema and discussion be provoked. However, for their successful distribution, emerging models need to be developed, a good example is festivals collaborating with VoD platforms or TV. She also brought up a very interesting take on piracy, arguing that this practice exists for films that people actually want to see, with an existent demand. Therefore, by trying to solve one problem, we could create another and generating demand should be the priority, in order to build an audience for new talents and great ideas, because VoD doesn’t create demand, it builds on the audience that already exists.
Andrew Lowe gave a very interesting insight, stressing the importance of key international partnerships in making a film an international success. He pointed out that even a new company, such as A24 in the US, can have astonishing results, which was the case with Room and The Lobster, securing future collaborations (A24 picked up Lanthimos’ next film). Both projects share unique talent and had something interesting to show audiences. The Lobster is a very interesting example, as it is a typical European co-production, emerging form the director’s needs (such as shooting location, crew origins, studio etc.) and at the same time providing something that audiences have never seen before, a new cinematic language. When asked about the privileged position of the English language, Lowe pointed out that the film’s idea and talent are still more important, using Ida [+see also:
interview: Pawel Pawlikowski
interview: Pawel Pawlikowski
film profile] as an example.
Ted Hope, agreed with Massenzi that a film’s theatrical release determines its value and this is the starting point from which you can build an audience, therefore a launch that promises audiences something new and interesting is crucial. He also noted that, a film needs to create a sense of urgency and an ability to change behaviour patterns, to which specificity is a key, “I look at specificity of character, culture and individual experience, which is universal and talks directly to the customer”, meaning creators and distributors establish a relationship with their audience. Also, according to him, having completed films at festivals searching for buyers is often inefficient, as it is important for a company to get involved early on. Ted Hope also argued that good ideas are the major driving force behind the success of European films, not economics and, in his view, piracy exists for a reason, as it is simple, convenient and free. However, there are other ways for companies to offer added value to their customers: quality sound and picture, service packages, amongst others, that bring something different. It is not just a question of the quality of the goods, but of the overall experience, which, according to Hope, is more urgent than ever before.
*Only the major co-producing country is taken into consideration, in case of co-production in order to avoid double counting