Rise and Shine Europe – an Insider’s Look into the Creative Market

Francisco Abadia, Eirini Digka, Elena Kutsarova, Carlos Magalhães, Zsofia Meszaros, Valeriia Panova, Savvinna Sinopidou, Maria Trofimova

Interview with Elena Lai

For the past 20 years, technological developments have had a significant impact on the audiovisual landscape, changing competition practices and reshaping the structure of the audiovisual services market. The European Union (EU) faces several challenges to safeguard the viable production of native audiovisual content and boost competitiveness. With the ever-rising digitalization of the audiovisual industry and the emergence of a few dominant players, the European Council have adopted initiatives such as the Audiovisual Media Services Directive (AVMSD) and the Creative Europe program. Both are designed to promote cultural diversity and stimulate European audiovisual production and distribution.

Actions and Policies: The EU to the Rescue

In terms of regulations, the AVMSD requires EU countries to coordinate national legislation with each other on all audiovisual media to promote European content and ensure its distribution via traditional (e.g. broadcasting) and digital (e.g. on-demand services) channels. The drive behind the measures is to create comparable conditions in all countries for audiovisual media in times of US worldwide monopoly on media production and distribution. The majority of films screened in European cinemas are American productions leaving little space for domestic creations.

As for funding programs, the EU has also been investing a €1.46 billion in the cultural and creative sectors through Creative Europe for the years 2014-2020. The program encompasses the EU’s previous Culture and MEDIA programs and includes a new cross-sector strand. It boosts European cultural and linguistic diversity and strengthens competitiveness in the creative sectors by funding at least 250,000 artists and cultural professionals, 2,000 cinemas, 800 films, and 4,500 book translations.

In the past years several EU-supported films have swept awards at prestigious international film festivals, such as the Romanian film ‘Touch Me Not’ — winner of the Golden Bear at the Berlinale last year — and ‘The Favourite’ — winner of the Grand Jury Prize at the Venice Film Festival. ‘The Favourite’ was also one of the five MEDIA-supported films nominated for the Oscars this year, along with other European (co-)productions such as ‘Cold War’, ‘Never Look Away’, ‘Border’ and ‘The Wife’.

Interview with Elena Lai, Secretary General of CEPI and Europe Analytica’s head office

We asked Elena Lai, the Secretary General of The European Coordination of Independent Producers (CEPI) and Europe Analytica’s head office, about the industry. Europe Analytica specializes in lobbying as well as collaborating with cultural and creative industries across Europe. CEPI represents over 8000 independent film and television production companies. Read on for some of the highlights of our conversation on the current challenges in the European creative industries sector.

Brussels Talking: In your experience how has the business model of cultural and creative industries changed over the last few decades?

Elena: The recent digital shift has a great impact on creative and cultural industries as well as the way the European Commission perceives the development of all future policies  and the single European digital market. We can already see a lot of changes in the TV industry. Nowadays it’s important for a business model to combine traditional processes with new technological opportunities.

It’s very important to understand that innovations and traditional models can coexist without immediate intervention with regulations. Producers should be open-minded to provide the best experience to their customers. The education sector also needs to keep up with technological innovations to provide people with the necessary skills.

Brussels Talking: In your opinion, what is one of the main bottlenecks of European cultural and creative industries?

Elena:  Distribution remains one of the obvious issues. Producers will have to have a very good script in order to create a pilot to sell at festivals. Another way to bypass that is to rely on the support of a big production company which makes the process of selling content to broadcasters or distributors much smoother. For example, it would be more difficult if you want to sell to a streaming platform like Netflix, because most of the time it would like to buy the full product, including all the rights. In other words, the creator won’t have a possibility for secondary exploration of their product. Secondary exploration helps producers generate more profit, distribute their content at an international level, reinvest in new movies, and create new job positions.

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Source: European Audiovisual Observatory
The figure displays the origins of accessed Transactional Video on Demand (TVOD) products.

We hope that with regulations such as the Revised AVMS Directive it will become easier to foster cultural industries. In the past, the Directive ensured that 10% of the distributed content by broadcasters came from European creative industries. Quite recently this Directive has been revised and from 10% it was raised up to 30% coming from online European content. So, platforms like Netflix must ensure that 30% of their online catalog is dedicated to European content. There is also the development of new guidelines and regulations related to Article 13 which the European Commission will have to develop until the end of 2019 in order to specify how those 30% are calculated exactly — is it by a number of titles or timing or anything else?

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Source: European Audiovisual Observatory
The figure shows the source of viewed Subscription Video on Demand (SVOD) films.

What to Expect Now?

As for the future, cinephiles can expect to see more local productions in the cinemas. The directive and other regulations are in place and working hard towards a culturally and linguistically diverse scene. According to the AVMS Directive international platforms operating in the EU are required to contribute financially to the specific country’s film funds. For instance, in France an American broadcaster has to pay a defined percentage to the French film fund and this is going to be applied to the rest of the Member States. The significant changes that have been implemented move the European cultural and creative industries to a more coherent and more competitive market. Hopefully, this trend will be followed up with more productions and the revival of the European creative industry.

 

Elena Lai works with highest-profile clients in the audiovisual, cultural and creative industries to represent them on the biggest issues affecting their business.

She has vast experience in identifying EU funding opportunities for programmes such as Horizon 2020 and Creative Europe. Elena acts as the Secretary-General of CEPI, the European Coordination of Independent Producers, raising the profile of European SMEs and guiding them through the Copyright reform and digitization. She also sits on the boards of several projects such as MediaRoad and Creative Skills Europe and the European Commission’s Framework on Gender and Equality and was recently elected as Chair of the European Audiovisual Observatory’s Advisory Committee. She is also Europe Analytica’s Head of Office.

 

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