Amid U.S. streamers still driving local market growth, producers of T.V. in the continent of Europe are trying to decide with the Hollywood studio model of business -in which Netflix and other streaming services have all rights to their content in exchange for full-financing and a cost in exchange for a fee — as well as the current European model of co-productions, which leaves independent producers with backend and allow the indie producers more creative control.
But this is beginning to change.
Due to the E.U.’s Audiovisual Media Services Directive (AVMS), which is currently in different states of being implemented across Europe, There are signs that the most prominent platforms are gradually becoming more flexible about structured agreements. In any case, it’s what we hope to see in the future.
The directive states that streaming companies must provide 30% of European content to European subscribers. However, on top of it, E.U. nations are introducing national-specific laws that require streaming services to directly return a certain percentage of their earnings in every European country in which they operate. Certain countries like France and Italy are currently making law changes that force Netflix, Amazon Prime, Disney Plus, and other streaming services to make local investments through independent producers. They will also ensure that the producers retain part of their rights.
“To begin with we welcome all of the opportunities by the streamers in every place in Europe,” claims Martin Moszkowicz, chairman of the government table of German influential Constantin Film. He explains that platforms like Netflix, Amazon Leading Movie, and Disney Plus “already are trading a fortune throughout Europe in local-language [content] and international English-language shows.”
A report released by Enders Analysis, a London-based company Enders Analysis says many Western makers “have come to prioritize streaming programs when begging their finest projects.” The report also noted that Netflix is considered the top producer of scripted European content in 2020ahead of the E.U.’s most significant public broadcasters. Disney currently has 60 European scripts waiting to be delivered in 2024.
However, while Moszkowicz is a fan of stream giants’ investment, his view is that their business model has become “ludicrous.”
“Number rights are retained; there is number upside,” he says. “There is nothing that we — and also the artists, the creative people that we employ — participate in the billions and billions of dollars of success that the streamers have.”
Moszkowicz states that German producers “will use AVMS as much as possible to get a bigger part of the pie” and believe that “ultimately we will succeed.”
Here’s a look at what’s happening in the conflict between the streaming giants and producers in the four most coveted continent European regions.
France
France in the E.U., where the government has recently approved the AVMS regulation, has set the way.
The new rules require that the streamers’ investments be put into agreements for independent productions where the rights return to French producers after 36 months.
This means that one-third of the money invested by the streamers will continue to be poured into agreements with French producers in flat-fee contracts, which do not permit the streamers to keep their rights.
Although it is a necessary regulation, the new rules raise questions about how these investment obligations will be used and who.
The rules allow competition between French producers for inclusion within the “two-thirds of the investment” corridor, according to French producer Alexandra Lebret. She is the director of the lobbying organization The European Makers Club.
“How may the streamers select that are the companies who will have a way to hold on to rights, and those that won’t?” she asks.
In March, Netflix made over EUR200 million ($220 million) in investment in France when it announced its 2024 lineup comprised of French originals, 10 of which are T.V. shows.
This includes “Standing-Up,” about France’s stand-up comedy scene. It was directed by “Call My Agent” creator Fanny Herrero.
Lebret notes that it isn’t yet understood what Netflix will select projects that can take advantage of the updated rules. He also mentions that Netflix’s most significant French production, “Lupin,” currently filming its third season, is being produced under a flat fee arrangement.
Germany
In Germany, which is the country where the Audiovisual Media Services Directive regulation is set to effect, there have been limited flexibilities by streamers when making deals for high-end productions.
“The more exciting the property, the greater your possibilities you will get through with this [structuring a package where rights return],” Moszkowicz explains. Moszkowicz.
One example of this is Constantin’s show “We Children From Bahnhof Zoo,” released via Amazon Prime Video in Germany.
It was also filmed in co-production with several partners, including the ITV-owned Cattleya in Italy and Fremantle managing international sales.
Constantin is currently putting together the premium television show “Smilla’s Sense of Snow,” which is based on Peter Hoeg’s Peter Hoeg thriller, for which Moszkowicz believes he’ll be able to put together an original co-prod that combines streaming partners as well as other kinds of broadcasters.
Moszkowicz emphasizes his belief that in pitching large-budget projects, the European government broadcasters and the pay-TV players offer an alternative that is viable to streamers.
In 2013 Constantin, along with veteran German TV executive Herbert Kloiber joined forces to create a company known as High-End Prods. to create event-driven programming specifically designed for Europe’s pay- and free-TV market.
Moszkowicz says that the sum of the sources of the pubcasters, including German’s ARD and ZDF and France’s TFI and the Italian RAI, as well as The BBC within the U.K., is far greater than the budgets of some of the streamers.
“It’s practically billions each year and they don’t get enough product, certainly since a lot of the really intriguing stuff gets ordered on a global foundation from the streamers,” the author says.
High End will soon be the first to announce its slate.
Spain
Even while AVMS isn’t yet fully implemented in Spain, there is a feeling that streamers have renounced their rights-of-all-rights rule.
“I think that at the beginning they tried to divide and conquer,” says director-producer Alvaro Longoria, who runs Spanish independent Morena Films.
However, other players are entering the market, including Disney, Apple, and Paramount.
“A lot of them realize that they have to be flexible if they want to get the best talent,” says the expert.
Longoria, whose Christmas-themed comedy film “Reyes vs. Santa” was acquired by Amazon in some countries and believed it significant to see the symbolism behind why Netflix has embraced “Parallel Mothers,” the most recent film by Pedro Almodovar — who was Cannes jury chair in 2017 was critical of the streaming company.
Netflix recently acquired the exclusive Latin American rights on “Parallel Mothers.”
“The whole business model is changing all the time and streamers are the first ones that are happy to adapt,” he says.
Italy
In Italy In Italy, in a country where AVMS deployment is amid a slowdown, there are some minor but essential signals that streamers are beginning to move.
“Some dynamics with the platforms are changing,” says Rosario Rinaldo, head of production company Cross Prods, owned by German’s Beta Film.
Cross is producing an edgy Amazon Italy Original drama, “Prisma,” for which it will be granted SVOD rights that will last for the rest of time
Rinaldo will be able to market “Prisma’s” free T.V. rights throughout the world, following the show exclusively shown on Amazon worldwide for a specified time.
“There is more attention toward producers’ needs during development,” Rosario claims. She cites the willingness of Netflix and Disney to collaborate on projects in conjunction with Cross.
The best instance of the Italian market for a significant U.S. player willing to work with Europe’s cooperative production strategy is HBO and RAI’s pubcaster “My Brilliant Friend,” the series based on Elena’s novels Ferrante.
In February, the 3rd installment in the show “Those Who Leave and Those Who Stay,” was aired on RAI with a record-breaking audience before it was released in the States with HBO and HBO Max.
“As a company, the look for forms of collaboration between numerous kinds of platforms and other broadcasters, including community broadcasters, is clearly element of what I’michael seeking,” says “My Brilliant Friend” company Lorenzo Mieli.{Recently|Lately}, Mieli, through his Fremantle-owned Apartment shingle, was capable of putting together the three-way co-prod between RAI, the Franco-German channel Arte, and Netflix.
They’re producing famous auteur Marco Bellocchio’s next T.V. show, “Eastern Notte,” about the assassination and kidnapping of the former Italian premier Aldo Moro by Red Brigades terrorists.
“The possibility of business models evolving — and disrupting monolithic models — is born from our ability as producers to propose projects that make this disruption worth it,” He states.
