Industry Report: Financing
The Spanish Audiovisual Funds
by Cartoon, the European Association of Animation Film
05/03/2009 - Manuel Cristróbal was coordinator of the
Media Business School, manager in AGAPI and
producer of several short films shot in 35mm.
From 1999 till 2005 he was the Executive Producer of Dygra Films, production company of the CGI animation feature films The Living Forest and Midsummer Dream. In January 2005 he joined Zinkia as Head of Development & Distribution working with the animation series Pocoyo (52x11) and Shuriken School (26x26).
He created the Galicia based company Perro Verde Films in September 2006 and is developing several audiovisual productions. He is also partner in 6 sales, a Madrid based sales agency specialised in animation features. He is Vice President of New Technologies and Member of the Board in FAPAE (Federation of Spanish Audiovisual Producers).
What has been changing in the Spanish
audiovisual landscape in the last few years?
There have been many changes in the business. The first big change is the restructuring of the national television, TVE. The national broadcaster had an enormous debt that was absorbed by the Government in 2007. Parliament approved a new law in 2007 and we have now a whole new system. We have now a President of the Spanish radio and television and a management team that stays for six years and will not be affected by the changes of the Government. In the previous years we could have a new manager of TVE every two years, making a long term policy very difficult.
Is there a policy concerning animation
within national television?
Not yet. The producers’ associations are working with the new TVE management to create a strategy. We had an agreement with TVE that ran for 4 years which now has expired. The amount of the agreement was €12 million.
What are the first measures
of the new TVE management?
In 2007 TVE acquired 55 Spanish feature films. In 2008 TVE will only buy 37. The policy is to increase the amount of money they will put in each film, but choose more carefully the films they want to support.
TVE is confronted to a reduction of revenues. The advertising allowed on TVE has been reduced. In 2007 it was 12 minutes per hour, in 2008 it will be 11 minutes, in 2009 it will be 10 minutes and in 2010 it will be 9 minutes.
Is there in Spain the same fragmentation
of the TV landscape we see in other
Yes, we will have for example DTT in 2011 and we are starting to see the effects. TVE has now four DTT channels, one of them being devoted mainly to animation with 12% of market share.
Are the broadcasters obliged to invest
in independent production?
Yes, every broadcaster that broadcasts films to audiences younger than 7 years old, is obliged to invest 5% of his turnover in film production (3% in Spanish production and 2% in European production). This obligation represents more or less €120 million a year.
Films like Asterix are getting license fees from the Spanish broadcasters. The obligation goes for theatrical features, TV films and mini series. Animation series are not included in this obligation. To access the subsidy, the film must be in production. There is a non written norm that imposes the producers to spend the money in Spain.
How much can a producer have from TVE?
A producer can get a contribution from €400.000 to €2 million mainly in TV rights. The most active broadcasters in animation are TVE, Antena 3 and Tele 5.
How strong are the regions in the Spanish
The regions are very active. The most advanced ways of investing are born in the regions. We have €67 million from the national Spanish institute fund and €40 million from the different regions.
The most active regions are Catalunia, Andalucia, Galicia, the Basque Country and Murcia. The best regional broadcaster is the Catalan one, which has to invest 1% of its turnover in animation series.
The Spanish Parliament approved a new
audiovisual law in December 2007. What
are the main elements of the law and how
does it work for animation producers?
Producers can receive up to €50.000 for the development of pilots. The system allows the production of two feature films a year, allowing a budget of €400.000 per film. The law created the automatic system. The producers have to comply with certain conditions and can benefit subsidies up to €1 million.
The main novelty is that we have a definition of the independent producer, which is very important. Independent producers must have a limitation of 30% in the company’s capital from a broadcaster.
Another novelty of the law is the project to transform the Spanish film centre into an agency.
The fund for audiovisual will go from €65 million to €100 in four years. We opened the possibility to have not only money for developing animation series, but also funding for the production of animation series and T V films. The law also foresees a tax shelter system of 18% that includes features and series, but it is too early to measure the results.
Is piracy in Spain a major concern for the
Out of the Western European countries, Spain is our biggest concern, with a piracy rate of over 32%. It is a huge problem. It is not only affecting DVD sales and the VOD business, but it is also seen as a problem for investors. Thanks to the French initiative, we will be having a solution to this phenomenon.
According to a large study conducted by LEK Consulting, an international consulting firm, the total loss to the Motion Picture Association members due to piracy is 6 billion dollars annually. About half of this is internet-related and I am fairly sure that the internet figure has exceeded the optical disc piracy rate which makes up the other half of the figure I’ve just quoted. We are dealing with both optical disc piracy and internet piracy but we realise that internet piracy is growing and is perhaps the bigger concern. Globally, the consumer spending loss to the motion picture industry in 2005 came to about 18 billion dollars.
Cartoon Master Munich, Germany, June 2008