The European film and television industry must embrace EU-based technology, focusing on audience needs, in order to be more competitive in the face of market penetration by global giants.
These are one of the conclusions of the European Commission’s second European Media Industry Outlook Report. This was a follow-up to the first influential study published in 2023, which helped us to think about the EU about supporting the sector.
The publication of this report is due to the European Union squeezing future support for the European media and audiovisual sector. In July, we published a proposal to replace the Creative Europe media program with a new Agoraeu program that supports both the audiovisual and news media sectors.
The second outlook report warns that the EU media industry, which employs 1.32 million people directly in the EU with 245,000 companies, is facing unprecedented competition with the global giant.
The European media market, including audiovisual, news media, video games and XR/VR, has said that it is “concentrated in a small number of non-EU actors, particularly from the US and China.”
These non-EU companies are “capturing a large portion of their revenue” across all media markets as they control distribution through platforms such as YouTube, SVODS, and social media. Traditional media such as television remain well-known, but are gradually being replaced by these digital products, with less European content.
The report warns that European industries remain fragmented and that several large companies can compete at the global or regional level. The development and adoption of proprietary technology products has been slower than in the US industry, which has been exacerbated by low levels of investment.
Film focus
On the film side, the report says feature film productions rose 3% in 2023 in the EU, with an estimated 1,779 fiction and documentary films. The production value of European films is also 16% higher than before the pandemic.
However, the report points out that European theatrical films rely heavily on public intervention. Direct public subsidies account for 26% of the film’s budget, while production incentives donate an additional 21%.
The rise in production spending reports that it has not led to an increase in the success of EU content as US content continues to dominate its audience.
On the SVOD platform, US titles share 51% of catalogues, while viewing time is 61%. EU work accounted for 20% of catalogue in 2024, but only 16% of consumption.
In cinemas, EU movies accounted for 29% of film tickets sold across EU countries, while US titles reached a market share of 66%.
US companies are growing
In the broader audiovisual market, the report found revenue sharing among US companies is increasing. US companies led by Comcast, Disney, Netflix and Google currently account for 40% of revenue for the top 100 groups operating in Europe. EU companies’ share has continued to fall to 59%, down 8 percentage points since 2016. Top companies in the EU were Germany’s ARD, Luxembourg RTL Group, and French Canal+.
Looking ahead, he said the EU industry is at a disadvantage given the accelerated technological innovation, such as AI shaping the market.
The report has affirmed the European media industry. EU companies have created reputable content and said they are strong in areas such as high-quality films and series, high-end VR hardware, independent video games, movies and reliable news. He also said that despite a temporary recession and termination, employment in the sector has grown and businesses are making profits overall.
However, the outlook concludes that the current state of play “poses risks to the economic resilience and creative freedom of European media, as well as the overall cultural influence of Europe.”
Recommendations
The European industry recommended focus on an audience-first approach “by adjusting content to the needs of a wider audience possible, while appealing to the widest possible audience.”
Due to the distribution of audiovisual and gaming content, this may include prioritizing marketing, community engagement, viewing experience, and recommendation systems for content discovery.
It also states that ownership or EU-based technology solutions “will help to maintain the expansion and sovereignty of European media. It notes that EU media is technologically dependent on global giants.
The report also said that leveraging artificial intelligence is essential, but noted that European industries rely primarily on non-EU AI solutions.
Media companies also called for investment in high-tech startups and scale-ups to develop solutions such as AI tools, blockchain frameworks, and cloud-based services. Currently, only seven of the top 800 R&D investment companies are media companies.
The report says European companies should try to better leverage IP brands that stand out in busy markets, warning that European media companies continue to struggle to maintain their rights and misuse them.
Henna Wilkunen, vice-president of technical sovereignty, security and democracy at the European Commission, presented a study of the European media’s outlook at the Venice Film Festival yesterday (September 4).
She held a closed door meeting with a selection group of executive groups from European companies and associations to discuss the Audiovisual Media Services Directive (AVMSD) and the proposed Agoraeu program.
(TagStoTRASSLATE) Distribution (T)Europe (T)Production
