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"New Approaches for Greater Diversity of Cinema in Europe?"


- The main findings of the report on the IFFR Live, SPIDE and Streams Day-and-Date events

"New Approaches for Greater Diversity of Cinema in Europe?"

The report drawn up by researcher Thomas Paris, entitled "New Approaches for Greater Diversity of Cinema in Europe?" (which was presented to the European Parliament and the European Commission), on the events IFFR Live (coordinated by the Festival of Rotterdam), SPIDE (organised by ARP) and Streams Day-and-Date (led by EuroVOD) makes for interesting reading. The releases analysed involved 23 films, distributed across 22 European territories with 112 D&D (day & date or ultra-VOD) releases and 21 direct-to-VOD or e-cinema releases).

The report: "National box-office receipts, in countries that still have a film industry, are divided between American blockbusters, present in all territories, and national films, often restricted to a domestic market. In this overview mention should be made of art-house films, which have an international audience: on account of their limited potential at a national level these films face difficulties in obtaining access to theatres in all the territories where they are distributed. (...) The phenomenon of globalization thus leads to the creation of a dual economy, in which European films enjoy only limited circulation. (…) Added to this is the concentration of the exhibition of films (number of screens per film) and the growing increase in the number of films distributed, which combine to limit the possibilities of screening for a large number of films."

Thomas Paris’ study of the compatibility of modes of distribution shows that these are not in direct competition and that the creation of new modes of distribution has not replaced others but merely provided more options. In terms of the economy of creation, in a situation where there is an overabundance of films and taking only direct financial profit into account (box office takings), it is favourable, given the circumstances, to release a film direct to VOD. "The fact that these days, this decision is affected by the exclusivity that a release in theatres represents, no doubt has a softening effect: as it is less unusual, the absence of a film in theatres will have less of a stigmatising effect". Moreover, the use of e-cinema among consumers is still not very widespread, which makes marketing investments more risky. Finally, specialisation by film type can occur, as shown by Day and Date releases in the United Kingdom since 2010, with an over-representation of non-national European art-house films, largely made up of documentaries.

"The different distribution channels appear to be compatible with regard to the film economy. Every film has its own economic profile: the cost of making it, estimated takings, and larger or smaller access to distribution in theatres can lead a distributer to opt, without much choice, for an alternative mode of distribution: a direct mode such as e-cinema (direct-to-VOD) or the simultaneous release of the film in theatres and on VOD (D&D). The calculation of direct revenue plays a part in this choice, but it’s not the only thing taken into account, especially when we consider the status that is given to a film when it is released in theatres, as will almost certainly be the case for a long time to come. When the decision is made to release a film simultaneously in theatres and on VOD, it is made to maximise audience numbers, faced, itself, with limited access to theatres."

"The interest for theatres in releasing films direct to VOD therefore relies on striking a balance between the effects of converting theatre-goers to VOD, and the increased visibility that can come with the promotion of a film being released direct to VOD, especially for theatres that do not benefit, for certain films, from national promotion."

The conclusions: "If it is clear that electronic distribution will, in the future, divert a proportion of viewers away from theatres, the impact and consequences of this are far less clear. It could make distributors happy, both because releasing films direct to VOD gives them a way of adding value to films that only have a small presence in theatres, and because revenues lost by distributing these films in theatres can be made back by releasing it on VOD. As for theatres, a priori, it is these that are most threatened by these new modes of distribution, and it is important that the film economy does not endanger their business. Without a doubt, art-house film theatres would be hardest hit. When we consider that it is their viewers who are most likely to convert to VOD, it is logical that the films these distribute would also be the most likely candidates for simultaneous release in theatres and on VOD. But even though a small loss of viewers could have a highly damaging effect on theatres that are already in a delicate situation, Paris’ analysis indicates that the overall effect would not necessarily be a negative one: a loss of cinema-goers converted to VOD could be counteracted by increased visibility of films. The respective impacts of these two consequences have yet to be seen, and are worth testing."

(Translated from French)

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