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CANNES 2015 Funding / Europe

European Audiovisual Observatory: The creative industry has great potential


- CANNES 2015: The future of financing was the main issue at the European Audiovisual Observatory's conference in Cannes

European Audiovisual Observatory: The creative industry has great potential
l-r: Martin Kanzler (European Audiovisual Observatory), Caroline van Weede (Cable Europe), André Lange (European Audiovisual Observatory), Lucia Recalde Langarica (MEDIA), Jacek Fuksiewicz (Polish Film Institute), Andrea Occhipinti (Lucky Red)

“The market share of European films has never been higher,” declared Martin Kanzler, film analyst at the European Audiovisual Observatory, at the 2015 workshop entitled “A Fistful of Euros – The Future of Film Financing in Europe”. In 2014, 33.6% of the films that were released theatrically in Europe were European. The most successful film was The Hobbit: The Battle of the Five Armies. Meanwhile, most of the cinemas in Europe are now digitalised: 92% of all screens have been converted.

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In many European countries, there is legislation in place that stipulates that broadcasters, distributors and VoD platforms must contribute to film funding. “In Poland, more than 50% of film support comes from TV broadcasters,” said Maja Cappello, head of the department for legal information at the European Audiovisual Observatory. In Germany, it has been suggested that all VoD platforms make a contribution to the Federal Film Fund, but the European Commission still has to greenlight this. Besides the film funds, there are various tax incentives in place for film production. As Jonathan Olsberg, chairman of Olsberg SPI, pointed out in his report, there are various tax shelters, cash rebate systems and tax credits all over Europe that production companies can apply for.

“It is difficult to co-produce with the UK,” underlined British film and music producer Mike Downey. One reason for this is that the British are not members of Eurimages anymore. “In the UK, there are many studio films such as The Fast and the Furious produced, which is good for the crews, but not good for independent film production.” In Italy, the number of international co-productions is also decreasing. “There is less money for these kinds of projects,” explained Andrea Occhipinti, president of the distribution and production company Lucky Red. “The market is controlled by the broadcasters RAI and Mediaset, which both have their own distribution companies.” Although Italian movies have a market share of 29%, most of the films don’t travel abroad. “It is difficult to find money for co-productions in Italy,” states the producer.

In Poland, where the Polish Film Institute is celebrating its tenth anniversary, there is €30 million available for film funding per year. Among the contributing parties are exhibitors, private broadcasters, digital platforms and cable operators. “The filmmakers are part of our selection committees,” explained Jacek Fuksiewicz, adviser to the director of the Polish Film Institute.

"Viewers don’t want to see classical TV anymore,” said Caroline van Weede, managing director of Cable Europe, which invests 25% of its revenues in the network. Most of the internet bandwidth is taken up by video: “30% of all the internet traffic is used by Netflix.” André Lange, head of the department for information on markets and financing at the European Audiovisual Observatory, criticised the fact that some industry members are contributing to film-funding systems, while others benefit from it without paying anything. “There is no financial obligation for Netflix,” he stressed.

“The recipe for a changing environment is to find the balance between continuity and innovation that values the whole chain, from creation to distribution,” concluded Lucia Recalde Langarica, head of the MEDIA unit in the DG for Education and Culture. “The creative industry has great potential.”

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