THE IMPACT OF COVID-19 ON THE EUROPEAN VOD SECTOR

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As we mentioned in our article last week, COVID-19 has had a dramatic impact on the VOD sector in the United States. The US market has always been one of the most forward thinking and innovative, with distributors prepared to experiment in how they release, promote and market content. However, outside of the US, more ‘traditional’ markets such as France and Germany have largely resisted experimentation in release strategies, instead enforcing more ‘rigid’ release windows for their films. Nonetheless, we are now seeing early evidence that COVID-19 is forcing these more ‘traditional’ countries to embrace alternative release methods.

Experimentation in Germany

In Germany, The Kangaroo Chronicles has become the first domestic film to break the theatrical window by going to VOD so soon after hitting cinemas. Usually, films that have received state production subsidies are required to hold to a strict windowing system, which involves a gap of at least three months between a film’s theatrical and its release to VOD. During these exceptional circumstances, however, The Kangaroo Chronicles distributor X Verleih was given a special dispensation to release the film earlier online.

The film grossed more than $5 million in its initial release in Germany and had topped the box office charts two weeks running before the country went into near-lockdown and cinemas across the nation were shut. The film was released on 2nd April to VOD at a cost of $18.50 (16.99 euros), with 15% of the VOD revenue going directly to a new emergency fund, AG Kino and HDF Kino, which are two national associations representing German cinema owners. Similarly, The Hater, the latest feature from Corpus Christi helmsman Jan Komasa, was made available on VOD just twelve days after its theatrical premiere.

The Kangaroo Chronicles became the first German film to break the theatrical window.
The Kangaroo Chronicles became the first German film to break the theatrical window.

Across Europe, regional VOD players, platforms and festivals are offering a wide range of free movies and TV shows, bringing their content to new, ‘captive’ audiences. In Italy, a proliferation of free services ranging from local streamer TIMVision to the vintage cinema archives of national film entity Institute Luce have started offering free content and special offers to encourage home viewing. In France, pay-TV group Canal Plus has announced its basic service is free for the next two weeks whilst subscribers are getting free upgrades. In Spain, leading independent platform Filmin is giving away 5,000 free subscriptions to watch movies screened at the Atlàntida Film Fest, which it organises.

Forces Resistant to Change

At the same time, Europe’s International Union of Cinemas is telling its members not to encourage or participate in programs that collapse the theatrical window and send new movies direct to VOD. It is instead encouraging members to seek government support and backed European-level initiatives, such as the Temporary Framework for state aid. This would allow cinemas to be able to access grants, state-guaranteed loans and other forms of aid for companies hit by the COVID-19 crisis. While we support these initiatives and believe that governments have an important role to play here in supporting the arts, we think innovation, now more than ever, is key. Theatres need to start thinking outside the box and not be reliant on such state aid support.

This is why we believe cinemas ought to see VOD platforms as partners and not competitors. Though we recognise theatrical screenings as a fundamental practice of film culture in Europe and beyond, we remain concerned that COVID-19 could again rear its ugly head in some shape or form, either later this year or next year. So for cinemas to refuse to innovate their release strategy or find ways to work with VOD platforms is a dangerous policy to take.

With that in mind, our FilmDoo Services business is now working with a range of partners in the industry to help re-focus their efforts to an online release and promotion. We are set on providing technical and marketing solutions and services to help cinemas, distributors and filmmakers to survive and, we hope, prosper during this ongoing crisis.

 

This article was published as part of an ongoing series on the impact and long-term effects of COVID-19 on the film industry.

 

Cover image: fiylo

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