28/03/2024 - BERLINALE 2024: The Berlinale’s European Film Market hosted a session centred on the current landscape of online distribution and VoD development across Europe

Renewing its partnership with the European Film Market, Europa Distribution hosted its 17th Annual Conference during the 74th Berlin International Film Festival. The gathering attracted nearly 50 members from the association, representing over 20 different countries across Europe and beyond. Attendees participated in various activities organised by the International Network of Independent Film Publishers and Distributors. These included a public panel and a private working session aimed at facilitating the exchange of ideas, strategies and potential solutions to key issues affecting film distribution today. Some of these topics included the rise of AI and its impact on the business, the need for innovative distribution and acquisition approaches, and the urgency of increasing collaboration and support within the industry.

On Sunday 18 February, a public panel titled “Zones of Interest: Distribution Trends for Online Releases” took place within the EFM Industry Sessions framework at the Event Hall of the Documentation Centre for Displacement, Expulsion and Reconciliation in Berlin. The session centred on the current landscape of online distribution and VoD development across Europe. It addressed the diverse opportunities and challenges faced by film publishers in their respective markets in terms of successfully bringing independent films online and generating meaningful revenue streams. This public event, open to all professionals attending the market and moderated by consultant and journalist Michael Gubbins, featured Anastasia Plazzotta, CEO and head of acquisitions at Wanted Cinema (Italy); Elise van Marcke, co-founder and managing partner at The Searchers (Benelux); Ivo Andrle, CEO of Aerofilms (Czech Republic); Kristi Porila, acquisition manager at Filmstop OÜ (Estonia); and Roderik Smits, Research Fellow at the Carlos III University of Madrid (Spain).

Gubbins began the presentation by providing an overview of the topics and realities to be tackled during the panel regarding how audiences engage with content nowadays. “We are cursed to live in interesting times because nothing will stay still. We've just got rid of the pandemic, but it feels like every year, there's something changing,” he remarked. While acknowledging there has been progress in terms of the availability of European content online – referencing a report by the European Audiovisual Observatory which suggests that EU citizens have access to an average of 13,000 pieces of European content (see the news) – Gubbins emphasised the lack of uniformity across Europe. Different countries exhibit varying levels of development, audience behaviours and the number of players operating in their markets. “This is where distributors come in. Someone has to turn availability into visibility and into sustainable economic businesses. Someone needs to bridge the gap between content and audiences in ways that are actually usable. […] There is an illusion of choice with 13,000 pieces of content. You need that expertise, that curation,” Gubbins elaborated.

Before delving into the main discussion, Gubbins gave the floor to Roderik Smits, an academic researcher specialising in the impact of the streaming market on the film industry. Smits has collaborated closely with Europa Distribution over the last year, conducting numerous interviews with independent film distributors and other industry professionals to explore “how they are dealing with issues related to online film circulation, and how they engage with streamers”. He provided an overview of his research findings, focusing on five specific countries – Germany, Spain, the Netherlands, Romania and Norway – which exemplify the aforementioned diversity, highlighting key issues that film publishers are confronting in those regions. The analysis revolved around the maturity of the streaming market in each country and the opportunities it presents for distributors, the presence of both local and international streaming platforms with distinct business models, the circulation and visibility of independent European titles, and the various release strategies adopted by publishers. Smits underlined the need for qualitative insights alongside quantitative data to understand audience behaviour and industry trends. “This is much more relevant than just getting the figures because you also get the nuances and complexities of the markets. I think we should continue this conversation from a qualitative perspective,” he asserted.

Elise van Marcke started by offering a snapshot of the Benelux market, where the Netherlands boasts a robust film landscape that recovered quickly after the pandemic. In contrast, Belgium presents a more complex scenario owing to the different linguistic regions and diverse audience tastes. This poses challenges for distributors as streamers treat the Benelux region as three distinct countries, where big players like Netflix are already well-established, while other platforms struggle with the language particularities. In terms of its business model, The Searchers acquires both commercial and arthouse titles, enabling it to offer package deals during negotiations with exhibitors to support smaller independent films. The company has always been proactive in pushing for combined release strategies, often opting for day-and-date releases on both theatrical and VoD platforms. During the discussions, van Marcke also pointed out one of the main obstacles for distributors nowadays: “Most of the content we buy today is on a script basis. […] I have to think about what people will watch in three or four years from now, and what streamers will demand,” which presents a real challenge within the evolving landscape of audience tastes and viewing habits. “I think that distributors are the ones that carry the most risk. […] Sales today are a pre-financing system to produce films. But although I put up that money in advance, I don't get any compensation if the film fails. That is something that needs to change in the coming years,” in van Marcke’s words.

Similarly, Anastasia Plazzotta went on to illustrate the situation of the Italian market, which stands out as a more homogeneous territory in terms of having a single language, with numerous well-established players. The Italian distributor explained how, during the pandemic, there was a significant surge of arthouse VoD platforms launched by independent publishers, but the majority faltered once theatres reopened in the country, and are generating virtually no profit at the moment. Plazzotta highlighted a shift in consumer behaviour over the past year, with the TVoD share declining while the subscription model, dominated by Amazon, has gained traction. Moreover, she drew attention to the proliferation of FAST channels in Italy – currently numbering around 100, with Samsung and Pluto leading the market – a trend expected to increase in the coming years. Discussing their distribution strategies, Plazzotta described how most publishers in the country collaborate with VoD aggregators to maximise their reach, targeting major platforms such as iTunes, Google, Rakuten and Chili. However, she acknowledged that revenues are still very modest, with distributors heavily reliant on the “theatrical bounce”. “We work very hard for the theatrical release, so when a film goes to the platforms, we usually don't have the strength, the money or the people dedicated to marketing the titles for this window.” At that point, “the film has to live its life”, as pointed out by Plazzotta.

Due to their relatively small market size, countries like the Czech Republic are not a priority for major global players, which opened up a window of opportunity for many strong local TV channels and distributors to establish their own platforms, as noted by Ivo Andrle. “From the very beginning, as soon as it was possible, we started building our own platform. We wanted to go independent, with whatever pluses and minuses it brought,” said Andrle about Aerofilms’ strategy. The Czech distributor believes that the discourse has evolved from what it was a decade ago, when VoD and cinemas were considered adversaries, to the current focus on ensuring content visibility and appeal for viewers at home. “About two years ago, we decided we'd give it a try and push as hard as we could towards the marketing, label and content of our VoD service. We feel that having certain titles on an exclusive basis is really key for the growth of the platform,” Andrle stressed. He also delved into their release strategies and how these are greatly influenced by piracy: “In our case, more than 50% of our releases can be found online before we go theatrical because of our biggest competitor, which is the pirates […] It's so common for the film to be out weeks before that it has become part of our release strategy. If it gets good reviews from the pirates, we can actually use that to our advantage for the theatrical release,” Andrle humorously admitted, eliciting surprise from fellow panellists.

Estonian distributor Kristi Porila also commented on the peculiarities and challenges of operating within a tiny market. Unlike the situation in the Czech Republic, local platforms haven't flourished in the Baltics, where Netflix appears to lead the VoD market. Despite its predominance in the region, the major US player still doesn’t provide subtitles in local languages, meaning that its content is mainly consumed by the younger generations, while older demographics favour TV channels. Consequently, distributors must adapt their approaches to reach diverse age groups across various platforms, with the attendant complexity involved in developing distinct strategies. Regarding the future development of VoD in Estonia, Porila remains optimistic: “Things will come, but it's important to note that Estonia is very small. Even if we go to Netflix and ask to do some theatrical screenings, they will refuse […] When we are part of something bigger, I think then it will be something to discuss,” she remarked, hinting at prospective collaborations among the Baltic territories. Lastly, Porila addressed a shared concern among many independent distributors across Europe: the high number of films produced and released every year. “It's not a popular thing to say, but we need to be very cautious,” she warned.

Throughout the discussions, Gubbins constantly underscored the pivotal role of distributors in curation, emphasising their willingness to take risks amidst the vast amount of content available, shifting audience tastes and technological developments. “That is one of the key elements of what makes distribution and publishing more essential than ever,” he expressed. He noted that, while the rise of AI and other tools can help publishers make more informed decisions based on data, most of their work still requires intuition and “gut feeling”. The core challenge of their work remains the same: connecting content with audiences, while continually refining their strategies. Overall, the panel gave a comprehensive overview of the current landscape of online distribution and the way in which distributors are navigating this ever-changing environment. “And let's hope, for the sake of cinema, they all succeed,” remarked Gubbins.

On Monday 19 February, members of the association gathered again for a closed brainstorming and networking session at the Relexa Hotel in Berlin. Reinforcing the association's role as a think-tank, these working sessions provide invaluable opportunities for distributors to collaborate and deepen their understanding of their respective markets while drawing inspiration from their colleagues in other territories. This private workshop focused on various subjects of current relevance discussed in advance by the association and its members, who are always in constant dialogue to cater these sessions to independent distributors’ specific needs. The main topics tackled on this occasion were AI integration, acquisition strategies, creative approaches for audience development – both in theatres and online – fostering collaboration and cooperation between distributors and with the rest of the players in the value chain, including on data sharing, and exploring opportunities for local distribution support of non-national films. Attendees participated in a series of round-table discussions, guided by Europa Distribution board members, delving into these common challenges and brainstorming potential solutions. The workshop concluded with a wrap-up session moderated by Michael Gubbins, aimed at sharing the key findings and conclusions of each group with the entire audience.

The recording of the public panel is available on the EFM’s website for Market Badge and Online Market Badge holders.

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