10/01/2006

French cinema professionals have warned of the dangers of legalising peer-to-peer (exchange of film and music files on the Internet) voted in unexpectedly on the 22nd of December by National Assembly in compensation for artists from the access providers which takes the form of a global licence. The Chamber of Film Producers Unions (CSPF) also handed in to parliamentarians an explanatory note on the economic impact of the global licence on French cinema production due to be discussed from the 17th of January. The latter deals with the pre-financing of films made effective thanks to the timeframe of releases, fixed by the profession and the State, after a film’s theatrical distribution: 6 months later for video, 33 weeks later for Internet, 9 months for pay-per-view, 12 months for pay-TV, 24 months for free TV (or 36 if the film was not pre-bought based on the screenplay). In 2004, the 203 accredited French features received more than 1 billion euros of investment, 80% private capital against 7% from fiscal mechanisms and 9,5% from fast-track and selective aid from the CNC (redistributed mainly through a ticket tax and TV and video receipts).

According to the CSPF, legalising downloading of films on the Internet will act mainly as a dangerous signal of encouragement to pirates. Also, by escaping the timeframe applicable to the different medias, this system has an unfair competitive advantage over the other means of exhibition (theatres, TV, video) who participate in the financing of films. The risk? A collapse in receipts for these means of exhibition for whom it will no longer be in their economic interest to pre-finance films, which will have heavy consequences notably for independent producers (75% of French films). Finally, the CSPF made a simulation of predicted receipts from the global licence (on the basis of 6 euros per month from 8 million internet users), arriving at a total of 576 million euros to be shared out between the music, cinema and audiovisual industries. Using the hypothesis that there would be an equal share between the music world and that of the recorded image, then a three-way split (writers, actors and producers) of the 50% given to audiovisual-cinema, and finally an equivalent amount redistributed to producers of audiovisual material and those in cinema, the total for film production reaches 48 million euros, 4,5% of current investments and the equivalent of the accumulated budgets of only 9 features.

(Translated from French)