IP/10/1168

Brussels, 24 September 2010

Commission supports digitisation of European cinemas

The European Commission announced a new strategy today aimed at helping European cinemas to go digital and to encourage more of them to screen European-made films, thus ensuring a wider choice for cinema-goers. The cost of digital equipment is prohibitive for many small cinemas and the Commission's strategy sets out options for financial support, including state-aid and backing from the European Regional Development Fund and EU MEDIA programme, which supports the film industry. One of the opportunities created by the move to digital is to increase the feasibility of converting films made in the first years of cinema to preserve them for future generations.

Commissioner Androulla Vassiliou, responsible for education and culture, said:"The digital revolution has transformed theway the film industry produces, distributes and screens films. These changes also create great opportunities for European cinema. Digital technology can reduce distribution costs and potentially increase the number and diversity of European films being screened worldwide. I hope we will soon see the benefits of digital technology in all European cinemas, including the independent and art-house screens that characterize Europe's unique cinema network."

In Europe, digital take-up is being held back because of the cost of conversion and the varying needs of cinemas. A new digital projector and server costs around €75,000, a big investment for small cinema operators.

Since 2007 the Commission has provided €25 million in support through the MEDIA programme for digital cinema initiatives and other innovative projects. It is planning to launch a new scheme at the end of 2010, which will contribute a further €4 million for digitisation, targetedat cinemas that screen mostly European films.

Art-house cinemas in the Polish region of Malopolska, the North, Centre and Alentejo regions of Portugal and the GermanLand of Niedersachsen have received support from the European Regional Development Fundto make the switch from celluloid to digital. Some French regions also plan to use ERDF money for this purpose.

As well as addressing financial issues, the Commission strategy seeks to:

  • Seize the opportunities offered by standardisation;
  • Make the digital transition as short as possible to avoid the cost of producing both celluloid and digital versions of films and a dual distribution/exhibition system;
  • Preserve and enhance the diversity of European programming in digitised cinemas;
  • Invest in research, equipment and professional training to boost the preservation of film heritage.

Background

Cinema-going is as popular as ever in the European Union, with 981 million admissions in 2009 - up from 925 million in 2008 (source: European Audiovisual Observatory).

Total European box office receipts amounted to € 6.3 billion in 2009 – a 12% increase on 2008. The European industry's market share represented 27% of total European box office receipts.

Although the number of films made and distributed in the EU far exceeds the number of films made outside the EU, this is not necessarily reflected in market share. In 2008, for instance, 167 US-produced films were released in the EU, while 726 films made in the EU27 were distributed. However, thanks in part to the financial muscle of the American distributors, the market share of the US films in EU27 was around 65% (source: European Audiovisual Observatory).

Art-house cinemas tend to screen more European-made films than the big-chains. Many of them belong to the 'Europa cinemas' network, which has received support from the MEDIA programme since 1995. The network includes 770 cinemas, with 1 945 screens in 443 cities in the EU27 and European Economic Area countries.

The MEDIA programme will contribute €755 million to support Europe's film industry from 2007-2013. The funding helps improve the distribution and promotion of European films and strengthen the competitiveness of the sector.

The new MEDIA Production Guarantee Fundwill provide €8 million inloan guarantees in 2010-13 to support and facilitate access to finance for European film companies and could be one of the future tools for accelerating digitisation.

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