MEDIA Programmes and Media Literacy Support Programmes for the European Audiovisual Sector Matteo ZACCHETTI European Commission June 2010 European Commission - MEDIA Programme and Media literacy Unit

Content The European audiovisual industry current situation European Cinema success stories The MEDIA Programme A changing and difficult market context New opportunities and challenges A new programme beyond 2013 MEDIA International and MEDIA Mundus Media Literacy 2

The current situation of the European Audiovisual Industry 1. The current situation of the European Audiovisual Industry

The European audiovisual sector employment and economic potential key role in building a European common identity intercultural dialogue and mutual understanding, which are key elements of European citizenship

A fragmented market The production structures and the general framework in which the European audiovisual industry operates are fragmented

Historical structural weaknesses MEDIA is historically an INDUSTRIAL programme: supporting the audiovisual industry partly to help it achieve a cultural impact The European audiovisual sector is fragmented in terms of both production structure and the cultural framework in which it operates. Fragmentation has resulted in culturally diverse and highly independent production industry and is providing a voice for the different cultural traditions that make up our European heritage HOWEVER: the fragmentation has prevented European industry from achieving a larger market share with respect to non-European imports both within the Union and worldwide. We struggle to match the high competitiveness of our American counterpart. SO: Action at a European level is needed to achieve this, at the stages of pre and post production. National support for the audiovisual sector concentrates on national works and, moreover, on the production phase. The phases of pre and post production are nevertheless the most critical to integrate a European dimension.

Box office dominated by US films US films account for 65% market share with only 20% of the number of films released NUMBER OF FILM FIRST RELEASES IN EU 25 BY REGION OF ORIGIN 2002-2006 Source: European Audiovisual Observatory – LUMIERE Database Total Films 2002-2006 Total Admissions 2002-2006 3 589 million € 25,2% 65,3% 2,3% 7,3% 18,5% 1 324 films 0,4% 7 161 films 61,3% 19,8% In 2009 Europe: 26,7% Eur Inc: 4,2% US: 67,1% Other 2% Data refers to first releases only and covers all films having been released between 2002 and 2005. EU 25 US Other EU 25 inc EU 25 US Other EU 25 inc

European cinema success stories 2. European cinema success stories

European cinema success stories Palme d’Or Dancer in the Dark 2000 La stanza del Figlio - 2001 The Pianist - 2002 L’Enfant - 2005 The Wind that shakes the Barley - 2006 Dancer in the dark – Lars von trier La stanza del figlio – Nanni Moretti The pianist – Polanski L’enfant – frères Dardenne The wind that shakes the barley – Ken Loach 4 mois, 3 semaines et 2 jours – Cristian Mungiu Entre les murs – Laurent Cantet Das weisse band – Michael Hanneke 4 months, 3 weeks and 2 days - 2007 Entre les Murs - 2008 Das Weisse Band - 2009

Cannes 2010 21 films supported by MEDIA selected in Cannes Official competition: 7 out of 19 films received MEDIA support Best actress Juliette Binoche Copie conforme Abbas Kiarostami Grand Prix du Jury Des Hommes et des Dieux Xavier Beauvois Best director Mathieu Amalric Tournée 10

European Film Awards 2009 Out of 48 films nominated across all categories, 46 have received MEDIA support for a total of €11,300,000 The European Film Academy has been supported by MEDIA for 20 years

Academy Awards Oscars Best film 2008 Best foreign film 2007 Best actress 2007 Best documentary 2006 Best foreign film 1997

EU Audiovisual Policy and MEDIA Programme 3. EU Audiovisual Policy and MEDIA Programme

EU Audiovisual Policy Objectives the competitiveness of the European industry the realisation of a zone for the free circulation of AV and media works the development of cultural diversity 5 générations de programmes se sont succédées, s’adaptant au fil du temps à l’évolution des marchés et aux besoins des professionels de l’audiovisuel européen, qui sont les bénéficiaires du programme.

EU Audiovisual Policy Instruments The Audiovisual Media Services Directive The MEDIA Programme http://ec.europa.eu/media

20 years of MEDIA Programme Five multi-annual programmes support since 1991 the European cinema and TV programmes industry MEDIA I (1991-1995) MEDIA II (1996-2000) MEDIA Plus and MEDIA Training (2001-2006) MEDIA 2007 (2007-2013) 5 générations de programmes se sont succédées, s’adaptant au fil du temps à l’évolution des marchés et aux besoins des professionels de l’audiovisuel européen, qui sont les bénéficiaires du programme.

Scope of MEDIA Programmes 31 countries 17

Budget MEDIA 2007-2013 € millions

MEDIA 2007 objectives Cultural diversity and heritage Transnational circulation of films Sector competitiveness 3 global objectives Fostering creativity in the audiovisual sector Strengthening the structure of SMEs Reducing imbalances between European audiovisual markets Supporting digitisation 4 crosscutting priorities 3 objectifs globaux: préserver et mettre en valeur la diversité culturelle européenne et son patrimoine cinématographique et audiovisuel accroître la circulation des œuvres audiovisuelles européennes à l'intérieur et à l'extérieur de l'Union européenne renforcer la compétitivité du secteur audiovisuel européen dans le cadre d'un marché ouvert et concurrentiel 4 priorités transversales soutenir la création et le patrimoine renforcer les structures de production des PME réduire les déséquilibres au sein du marché européen soutenir les développements liés à la numérisation à tous les stades de la chaîne de production et de distribution 19 19

Financing & co-productions MEDIA 2007 Action lines Distributors Pre-production Production Circulation Sales agents Distribution TV broadcasting Scriptwriting 55% Online distribution Training Management Exhibitors 7% Digital technologies Access to markets Single projects and catalogues Promotion Festivals Development Financing & co-productions 9% Common actions 20% Interactive works Information tools Pilot projects Media Desks 4% 5% 20 20

Number of projects supported 2008 ACTION LINE MEDIA 2007 TOTAL FUNDING AWARDED NUMBER OF PROJECTS Training 6.826.692 46 Development 23.669.395 365 Distribution 55.412.540 1.149 Promotion and Festivals 10.718.393 138 Pilot Projects 701.750 3 Video on Demand 6.259.139 18 TOTAL € 103.587.910 1.719 Number of projects supported by MEDIA in 2008 per action line 21

A changing and difficult market context 4. A changing and difficult market context

New global market context Economic situation Financial crisis Credit crunch Sources of finance Reduced broadcasters advertising revenues Second digital revolution New technologies New opportunities New financing sources New market context for AV works Reduced broadcasters contribution to cinema Reduced investments in new content Public money is getting scarcer Distribution and consumption New digital services are booming New ways of producing and consuming content Traditional markets are saturated 26

The digital revolution brings about changes… The digital revolution means profound changes for the cinema economy, equivalent in 10 years to a century of previous changes Mutations in distribution, exhibition and production sectors Booming number of distribution channels

… and opportunities These changes can mean great opportunities Facilitate circulation of AV works Particularly important for European works who have little space in the traditional model

The cost of adaptation But these important transformations have a high cost in the short term The economic situation makes it difficult for the European industry to meet these costs Which reinforces US films competitive advantages

Summary and conclusion Economic and financial crisis Structural weaknesses of European AV sector New market context for AV works Shrinking sources of finance for cinema Second Digital revolution Need to adapt New technologies New opportunities Need to provide structural industrial support to the European AV sector Booming number of services New ways of consuming Important costs involved 27 26

New opportunities for the sector and challenges for MEDIA 5. New opportunities for the sector and challenges for MEDIA

New opportunities favourable to European films Old model Traditional Media New model Digital Media Gatekeeper Model Restricts Audience Access Limited Space Suits Blockbusters Expensive Delivery One-Size-Fits-All Strategy One Version Territorial release Exclusive Rights Deals Value = Unit Sales Little Connection to Audiences Creator Consumer Led Model Enables Audience Access Unlimited Space Suits Niche & Specialist Low Cost Delivery Tailored Strategies Unlimited Versions/ New Formats Global Release Non-Exclusive and Exclusive Deals Value = Data, non-copiable items Direct Relationship With Audience Source: Power to the Pixel

Changing context but same challenges The old traditional model underlying cinema production and distribution is in crisis but is still dominant New emerging business models have not taken over yet But the key challenges for the creation of audiovisual works remain the same Finding sources of finance Creating compelling and attractive content Art of story-telling Reaching the audience Need for new sources (ex: Investment funds, crowd-sourcing) More complex environment Interactive story-telling Multiplication of channels Interdependence between supports New business models

6. A new Programme beyond 2013

A larger scope for a new programme 3 main interacting areas of intervention Cinema Television Interactive Strategic issues Competitiveness Cross-media Circulation and new forms of distribution

Roadmap 2013 and beyond 2010 2011 2012 2013 2014 IA for new programme after 31/12/2013 Draft decision and decision process Adoption by EP and Council Launch new programme 1/1/2014 The European audiovisual sector is fragmented in terms of both production structure and the cultural framework in which it operates. Fragmentation has resulted in culturally diverse and highly independent production industry and is providing a voice for the different cultural traditions that make up our European heritage HOWEVER: the fragmentation has prevented European industry from achieving a larger market share with respect to non-European imports both within the Union and worldwide. We struggle to match the high competitiveness of our American counterpart. SO: Action at a European level is needed to achieve this, at the stages of pre and post production. National support for the audiovisual sector concentrates on national works and, moreover, on the production phase. The phases of pre and post production are nevertheless the most critical to integrate a European dimension.

MEDIA International and MEDIA Mundus 7. MEDIA International and MEDIA Mundus

Strategic Objectives Respond to global economic context Reinforce the action of MEDIA and vice versa Provide opportunities for all European professionals to benefit from international cooperation opportunities Preparatory Action MEDIA International : to test keenness of international operators to cooperate 35

Basic Principles Strengthen cooperation between professionals from Europe and from third countries Mutual benefit & partnership International networking effect Coordinated by European professional

Preparatory Action MEDIA International Voted by the EP 2008-2010 Designed to test actions and to prepare for MEDIA Mundus Projects supported 20 projects in 2008 40 projects in 2009 € millions Lines of action 2009 Training Promotion Distribution Cinema network Audience / Film Literacy

MEDIA MUNDUS Fully-fledged programme with a legal base 2011-2013 Decision adopted in September 2009 with a budget of € 15 million over 3 years € millions

MEDIA Mundus action lines Pre-production Production Circulation Co-producing Financing Market Access (Work in progress) Markets, events & pitching Development / Pitching Distributors Training Digital Technologies Sales agents International markets Right holders Distribution Circulation (Finished films) TV broadcasting Online distribution Cinema network Events and film literacy

8. Media Literacy

Media Literacy Media Literacy is about being able to access all media, to fully exploit their potential and to use them in a critical, active and creative manner.