Methodology, Skills and Professional Benefits Participants Participants' Comments MEDICI Head of Training «The 12 Labours of Hercules» Report of the Reports – Workshops 1 to 4

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Ninth Workshop – 25 to 27 September 2019 in Potsdam, Berlin

Module 1: Platform Economy


The emergence of Netflix (more than 140 million subscribers) and other streaming platforms could be considered as a tsunami in the audiovisual environment. They are profoundly changing audience behavior and have a deep impact on film production, financing and distribution. A great deal of money and resources go into the creation of original content for platforms. This huge impact of the digital platforms raises multiple questions for the public film funds:

MODULE 1 deals with the current situation of the media platform economy and the developments that we can expect in the coming years. It consists of three lectures followed up by the discussion on how the national funds could or should react and what role the European Commission should play in this area. The idea behind this module is to provide a map showing where the platform economy stands today and where it is going.

An Overview of the Platforms’ Landscape

Patrizia Simone, European Film and TV Analyst/European Audiovisual Observatory
See Patrizia Simone Lecture (PDF)

Patrizia Simone Lecture

The VoD Models

We can identify three different types of VoD models.

Patrizia Simone Lecture

VoD platforms and Pay-TV in the EU market

Currently, the Pay-VoD is driving the growth in the EU audiovisual market. The figures show that Pay-VoD revenues have been growing quite consistently (+34% over 2106 and 2017) while Pay-TV has much smaller annual growth rate (only 2%) and physical video was under a steady decline (-17%) and more specifically:

What is the catalogues of VoD services offered in the EU?

In 2019, the Observatory conducted the research during which it tracked 45 SVOD services and 77 TVoD services. And we identified in total 27000 EU films available on VoD compared to 7000 EU titles theatrically released as first window. Among these 27000 films:

There are significant differences among the countries. The share of European films tends to be higher in large markets.

The new AVMS Directive / quota of 30% EU content on VoD platforms

The new AVMS Directive requires that the share of European content in VoD catalogues must be at least 30% and that VoD must ensure the prominence of the European works contained in these catalogues.

As of today:

Even though the quota requirements are already mostly met, there are still several challenges:

Availability Vs. Visibility

The most urgent challenge for European films when it comes to VoD distribution is visibility – the capacity to be promoted and reach out to the audiences.

The Observatory conducted a research by looking into a limited data sample of 42 mainstream VoD services in 5 EU member-states (Belgium, Germany, France, the Netherlands and the UK). We did a snapshot of what is promoted on the webpages of VoD services and concluded several things:


There is a common myth that global platforms are interested only in blockbusters. But we analysed the shares of theatrically released films in the catalogues of four major players (the two main US players – Netflix and Amazon, and two European large players – Viaplay and TIMvision):

The direct investment of VoD platforms into films

The Observatory has recently done a research in how European films are financed. It was based on the limited sample of final financing plans of 445 live-action fiction films released in 2016 in 21 European markets. The sample involves the investment volume of 1.4 billion Euros and estimated 42% of coverage rate. The analysis showed the following:

General Conclusions

Regarding VoD Services

Regarding Public Film Funds

How the platform landscape is evolving on a global level?

by Fabio Lima, CEO/Sofa Digital and Filmmelier (Brazil)
See Fabio Lima's Lecture (PDF)

Sofa Digital deals with all of the phases of distribution: acquisition, delivery, marketing, reporting, financing. We aggregate the content and deliver to other platforms. We have recently started working on blockchain.

General challenges

Two ways of monetising content

There are two ways of monetising content:

This section explains how these two modes of monetising content looked before and after the digital entered the game


There was one cluster of models of monetising films based on:

Before chart


Nowadays, the presence of the digital has not changed the economics of monetising and financing the content. There is still the revenue-share side and the licensing-side. However, there are some new players, new opportunities and more competition because the number of distribution channels is expanding. The age of distribution scarcity and the traditional operation models of theatrical distributors and Pay-TV channels is gone:

Now chart

The digital players and their offers

The digital players can be classified into 4 groups:

Players offers chart

How all this will be reflected in the area of arthouse cinema?

The experience of the Norwegian Film Institute (NFI) with big platforms

The obligations of direct investment in European works for VoD platforms implies that some large global players such as Netflix, HBO or Amazon Prime would co-produce or pre-buy a European work that has already been supported by a public film fund. While this can bring an alternative source of financing to European producers, during the MEDICI workshops in 2018 and 2019, representatives of European public film funds raised the following three controversies that so far have been triggered by the involvement of the VoD platforms:

  1. 1. Would it be acceptable that a film that has been supported by public funds from different countries incl. Eurimages, but attracted no interest by distributors, be sold to a digital platform that takes all the rights, including the theatrical ones, for 15 years?
  2. 2. Netflix simply does not respect the cultural and protectionist rules of the European public film funds. In reality, Netflix as a US-based company addresses European production companies, does not pay any taxes or levy to the national film funds unlike movie-theaters, distributors, TV channels, Internet providers, etc.
  3. 3. Finally, acquisitions of European rights by Netflix and other platforms undermine the basic concept of “independent producer” which is at the core of public film financing in Europe. Namely, public film funds and broadcasters in Europe have the mandate to use their subsidy structures to support production of independent works produced by independent producers. However, when producers sell to or co-produce films with global digital platforms that are outside the European system of co-production treaties, totally private, on the stock market and owned by investors, they must give away all the rights and stop being independent producers, which disentitles them from the public support they received from the film funds.

NFI case study

Presented by Lars Løge, Director of Development and Production Department, Norwegian Film Institute

Lars Løge

NFI entered into a conflict with the Norwegian production company that co-produced a drama series with HBO. Namely, the producer developed the project himself as an independent producer, which qualified him to apply to the NFI for the production support. The NFI granted the production support on the basis of the great audience potential and a significant cultural value of the drama series. The fund was aware at the time that HBO would also come along as a co-producer. However, when the drama series was well into production, the NFI demanded to see the producer’s contract with HBO and found out that the producer sold all IP rights and ownership to HBO. The contract stipulated that in case of any breach, HBO will be considered as the sole owner of the work.

On the one hand, it was a fantastic contract for the production company in a sense that HBO financed almost the entire series. However, the NFI believes that the producer breached the NFI’s funding rules and regulations by signing this contract because it tricked the NFI into subsidising the global digital platform instead of an independent producer whose works cannot be financed through the market alone. Consequently, the NFI withdrew from the project and asked its money back. For the fund it was unacceptable that the ownership is completely out of hands of the producer while HBO can decide on absolutely everything regarding the project. The producer complained against this NFI’s request and the case ended up at court. The litigation is still in progress at this moment.

The above case raised many issues that the European public film funds may face once VoD platforms start investing more frequently in European works. It signals that some basic terms and concept need to be re-considered:

The conclusion that the NFI has made is as follows:

As the first action dedicated to resolving this issue, the NFI started hosting North American VoD platforms every now and then with the idea that they come to Oslo to hear the pitches by the Norwegian producers who already received some NFI support and intend to internationalize the further financing. In this way, the NFI facilitates matches between the market and independent Norwegian producers. However, if producers choose to sell all the rights to a platform, the NFI will step out and claim its money back. Otherwise, if the platform and producer decide only to co-produce under the conditions that resemble the conditions under the European co-production treaties, then the NFI stay in the project.

Constraints, opportunities, actions to be taken by public funds regarding platforms as a financing partner

by William Page, CEO/FilmDoo-Eurovod (Brazil)
See William Page Lecture (PDF)

William Page is the co-founder of FilmDoo Ltd, a London-based VoD platform that focuses on international films with language and culture of different countries. It is supported by the European Union. He also co-founded the company called Fasso U.G, in Berlin that is based on technology business. He is also the director of Eurovod, an association of European VoD platforms and technology businesses consisting of approximately 400 members from across Europe and internationally.

General trends

Challenges for film-financing and distribution practices

Continued industry uncertainty

How to Exploit VoD for Produced Content?

In which chronology?

Maximising revenue and exposure for independent distributors

What does this mean for funders?

How can funds help producers deal with platforms?

Group discussion about the funds’ experiences with VoD platforms

What happens with the independent producers’ revenues?

What happens with the IP rights?

How to ensure more visibility for the European works?

A synergy of the new and the old platforms?

How to regulate the new platforms so that they contribute to the implementation of cultural policies, especially in small countries?

The public film funds’ experiences with new players and forms of content, their impact on funding schemes and their responsibility towards the industry in the 21st century

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