Mathieu Debusschère • Managing Director, ARP
"Funding is at risk for French works over the next two years"
- Mathieu Debusschère, Managing Director of the ARP, offers his analysis of the crucial and urgent need to include platforms within the French film funding system
An optimist who’s no less lucid for his positivity, Mathieu Debusschère, managing director of the ARP (the Civil Society for Authors-Directors-Producers) - one of the most influential professionals organisations in the French film industry - shares his thoughts on the prospects for finding a way out of the health crisis.
Cineuropa: French film is at a standstill with great uncertainty surrounding the resumption of filming and the re-opening of cinemas. The authorities have introduced a few support measures and are promising others. What’s your view on the situation?
Mathieu Debusschère: It’s a difficult time for the sector, from an industrial point of view, from a creative point of view, but also for viewers. The main priority is obviously for movie theatres to re-open as quickly as possible, under reasonable sanitary conditions, and for filming to slowly resume, also under reasonable sanitary conditions, because many projects have been halted or haven’t been able to commence filming during lockdown. The authorities have made significant efforts. In the first instance, they’ve introduced like-for-like funding mechanisms: for example, the CNC has allowed production companies to draw on up to 30% of their support funds to meet their immediate needs. The government has also provided very clear support in the form of part-time unemployment schemes which the great majority of producers, distributers and cinema owners signed up to. Now we’re wondering about what happens afterwards, looking beyond the short-term support which - in the case of the CNC’s support fund - is no more than a cash advance; money which, in six months’ time, will no longer be available to those producers when they’re looking to develop new projects.
Funding is at risk for French works over the next two years, firstly because the CNC’s reserves have been somewhat depleted in the short-term, but also because there will be gaps in the CNCs reserves as of next year. Effectively, their funds rely on TV networks’ advertising revenues, and when we look at the current fall in turnover reported by TF1 and M6, that’s money that won’t find its way into the CNC’s coffers next year. There’s also the entertainment tax paid by cinema goers (TSA): clearly, there won’t have been much of that for a number of months in 2020. For all these reasons, the CNC are going to face big funding issues. There are also going to be huge problems with financing the works themselves, because TV networks also rely on their advertising revenue as a percentage of their turnover and so, in absolute value terms, there will be an automatic drop in TV networks’ investment obligations (n.d.r: pre-purchases). For all these reasons, we need to start planning for the future.
That’s why we’re satisfied with the French President’s announcements, notably on the transposition of the AVMS directive which, in all likelihood, will take place very quickly via decree. Because the idea is to straight away galvanize those who are benefitting from this period, i.e. SVOD platforms, companies like Netflix, Amazon, Disney, who have seen a significant rise in their earnings since lockdown began and who have no obligations towards film production in France. Speedy implementation of the AVMS directive will allow us to start up negotiations with them, requesting that they make a significant financial contribution to French film in all its forms. The state will impose the French version of principles of cultural diversity: an obligatory financial contribution, provisions relating to independent productions, the fact that obligations towards film and obligations towards audio-visual works can’t all be lumped together… Then, we’re going to negotiate with the platforms, perhaps suggesting a release window that’s more appealing than it is within the current media chronology set-up, so as to encourage them to fund more diverse products. But we need to move very quickly to ensure this mechanism comes into effect by 1 January 2021, so as to compensate the losses mentioned earlier.
You’re asking for a speedy transposition, via decree, of the AVMS directive, but the government has only promised to do so by the end of 2020. Whatsmore, previous negotiations over media chronology have proven laborious, with each party fighting tooth and nail to protect its own interests. Do you think the urgency of the situation will inspire solidarity?
I hope so. Regulation would speed things up and would mean not having to wait for some hypothetical audiovisual law. But for these obligations to be effective by 1 January 2021, the directive needs to be implemented well in advance of this date. If it’s transposed in December, we won’t have time to co-ordinate with the Ministry of Culture on the broader lines of the rules (which will provide greater details on the directive’s transposition and establish the obligatory financial contributions to be paid, as well as the difference between pay-TV operators and free-TV operators, etc.) or, subsequently, to negotiate with platforms to get what we need on 1 January 2021. In terms of the media chronology, I get the feeling that the crisis is upending our sector so severely that there’s now a shared desire for swift modernisation. The crisis has highlighted just how great the need was for more flexibility in this chronology. We’re definitely not looking to turn exceptional lockdown provisions into general rules of law, because they were one-off measures which were only implemented because cinemas were closed and films needed to be given the chance to exist. So, we’re going to return to a system of ordinary law as quickly as possible. But the principle of technological neutrality is clearly looming: if tomorrow, we find that Netflix, Disney or Amazon can put as much money on the table as Canal+, with the same commitment to diversity and a virtuous approach, it’s not because some of them are SVOD actors, and the other a linear actor and terrestrial broadcaster, that we can’t allow the former the same exploitation window as Canal+.
Given the outperformance of platforms, I think everyone knows that the time has come to set them proportionate funding obligations. But we also need to negotiate with them to push them towards more diverse products. For this to happen, we’ll need to offer them something and I can’t see much else other than the duration of rights and time windows, in other words media chronology: giving these platforms, in exchange for virtuous and diversified investment, a media chronology exploitation window that they can get really excited about. Because if we cling onto the principle of an 18-month window, it’s not really going to incite Netflix, Amazon or Disney to agree to any additional commitments, especially in terms of diversity.
(Translated from French)
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