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EuroVoD letter in response to Covid-19

Updated: Dec 7, 2020

Response of the Creative Europe program on funded projects to Covid-19

We all hope that you, your families and colleagues are safe and not directly touched by the Covid-19 pandemic. Covid-19 had a major impact not also on our lives and habits, but on all the audiovisual industry with unprecedented challenges to our businesses and activities.

We would like to express our gratitude to the European Commission, but also to the national member states, federal government and film funds for their prompt and exceptional financial support they have been able to muster. Our gratitude is also extended to all the people that assured essential services during the restrictive measures, like health care, safety and many others.

We would like also to express our solidarity with all those that have been heavily touched by the pandemic and the crisis, especially the most fragile, who deserve a rapid and efficient assistance. EUROVOD is the European Federation of VoD platforms, regrouping nowadays 30 members (24 Core, 6 Associate), established in 16 EU countries: 5 global, 7 national and 12 international platforms covering 34 territories, but also VoD technical providers and aggregators. The platforms members of the association are independent companies (SMEs) with an aggregated catalogue of 77% in average of European content.

The support of the European Commission, through the Creative Europe MEDIA funds, has been extremely important for most part of our members in order to be able today to face the challenges of these times and to be reactive in adapting to the B2B and B2C demand, despite the restrictive measures. Thanks to the MEDIA programme, we can now see the positive effects of having a network of indie VoD platforms that can participate actively and support the European audiovisual sector, where the whole chain of rights is trying to find new ways to reach the audience online.

We welcome the Creative Europe Notification that was published one month ago, and even more so, we are very grateful for the short term measures, such as the postponing of the call of proposal Promotion of European Audiovisual Works On-line 2020 of one month (it would have been impossible for many of us to respect the deadline or to be well prepared for the submission of our projects), and the organization of a Stakeholders meeting on the 31st March, showing your willingness to support our sector in these difficult times.

We would like to take the chance with this letter also to give you a first feedback about the impact that Covid-19 is having on our own EU funded projects, activities and members, and to specify measures that we consider essential in order to keep the Creative Europe funded programs alive during this unprecedent crisis.

Overview of Impacts due to Covid-19

As an association, we are also collecting the first feedback from our members about the impacts that Covid-19 is having on their business and on the ongoing Creative Europe funded projects.

Our members are working hard at the moment to adapt and take relevant actions to bring cinema, culture and entertainment into public's homes, in this global context of Covid-19 restrictive measures. Member platforms are working (remotely) to set up new offers and support partners and rights holders in the audiovisual sector, institutional and educational organizations, as well as their regular audience. The agility of indie platforms and their strong relationships with right holders and local players (theatres, festivals, institutions...) allow them to be very reactive and innovative in their editorial responses and proposals to match the public expectation during this difficult period. It is proven by the numerous and various actions that are made available by many EUROVOD platforms, along with the agreement with rights holders.

A boost on the online distribution of European content - Overall, our platforms experienced an important growth of the online traffic, even quadruplicating in same cases the figures compared to March 2019, bringing more income also to the rights holders and contributing significantly to the distribution of European films online, in Europe as worldwide. The richness and the diversity of the catalogues of the independent platforms proved its strength. Audiences expressed their appetite for quality, patrimonial and specialized content, which are not part of the catalogue of the global players, so this period stresses the need for alternative catalogues such as those of EUROVOD members.

Supporting the European rights holders – EUROVOD members are experiencing a rapid and massive demand from the audiovisual industry (cinemas, festivals, distributors, producers, promotion agencies...) to more closely cooperate in order to give European films an alternative visibility and make European works circulate more widely. The difficulties of our VoD platforms, which are mainly SMEs with reduced resources, are to fulfill all the needs of the industry, in such a short time, trying to find a compromise between the financial difficulties encountered by the rights holders, their need of a rapid distribution on-line, and the lack of treasury/financial capacity of our companies to anticipate their rapid needs, for instance all the MGs. We have to adapt our strategies to the sudden and new needs of the sector, and this situation is impacting our tech and marketing roadmap. The most important thing is that the lack of theaters does not block the flow of releases or at least, that the little distributors have other options to ensure some revenues. We believe that this is a very difficult situation for producers and distributors, and we must find a way to offer alternatives that guarantee to maintain, as far as possible, the activity and part of the income without incurring a penalty on behalf exhibitors. On the other hand, we believe that the European platforms of EUROVOD can play a very important role in bringing European culture to its citizens during this crisis; platforms are also a communication channel between institutions and all European citizens.

Financing – As MEDIA supported projects, the co-financing of many European projects comes from many different partners in various European countries. This funding is also often from private sector investors, which has unfortunately dried up during this crisis. In many cases these projects are not entitled to apply for financial support from their countries of origin, which has left them in a difficult and vulnerable position. This means that in many instances the only solution regarding the financial backup of our initiatives during these difficult times has to come from the EU and more specifically the Creative Europe program.

Operational Difficulties – Whilst this is a moment where our platforms are under the spotlight of the audience, rights holders, and mainly the whole chain of rights of the audiovisual industry trying to find an alternative channel for the distribution and promotion of their works, we have been impacted by operational issues: a rapid growth of streaming consumption brings with it the need of quick and important technical adjustments and set-up, in a moment when everyone is working from home, and many technical service providers cannot answer rapidly enough to the demand.

Reschedule and slowdown of marketing and promotional activities – Many of us, even those which are more technical in nature, have significant marketing and promotional activities that has been cancelled or postponed (including the Sofia International Film Festival, where EuroVoD organized its European VoD Meetings, or the Cannes Film Festival). This is made more difficult by not knowing or having perspective on when the lockdown situation necessary for our safety and the international travel restrictions will change. This makes the completion of many Creative Europe funded projects on schedule, even with the additional six-month extension allowed, extremely difficult. The marketing and technical road maps had to be drastically adjusted, in conditions that are not ideal with the lock-down.

Support of Creative Europe

As mentioned before, Creative Europe has been essential for many of us in order to grow over the years and be ready to rapidly respond to the challenges provoked by Covid-19 crises. Without the MEDIA support, we wouldn’t be able to offer such large and diverse catalogues of European films to European and worldwide audiences and to be an alternative channels for European rights holders (festivals, producers, distributors, cinemas..) for the distribution of their works.

Considering the above, we outline a few potential ways in which the Creative Europe programme could continue assist us in our projects and support the whole AV industry consequently.

Encouraging the development and the cooperation between independent European VoD platforms – The variety of the editorial offer of the independent and specialized streaming services, and their ability to approach specific audiences is a strength, as the diversity of the languages in Europe. The EUROVOD network of platforms can become the tool that enables the continuity of the European audiovisual industry. Supporting the creation of subtitles is essential in order to reach the largest audience, along with the technological developments. The mutualization of costs and resources is crucial for the sector, as the cooperation among independent platforms with a cultural vocation, with the educational networks and institutions, and finally with the chain of rights (e.g. formalize and systematize national and international data bases about right holders). This coordination needs to be supported and endorsed. Our platforms are primarily distributing European works, and now more than ever European cinema should be supported in its online circulation and promotion, and the European industry should be helped in this very difficult moment for many of them, especially the independent and SMEs companies. A specific fund to SME’s distributing European films in order to face this rapid and strong demand would certainly have a significant impact at this time. It would be a great help if the European Commission could endorse our projects to the private financial institutions, empowering guarantee funds and facility and enhancing more loans

covered by the future guarantees. Last but not least, EuroVoD association itself has very limited resources and Creative Europe is the main financial partner of its activities. Now more than ever a strong coordination of the network and the development of tools and business intelligence within the European VoD sector are needed. The network is growing in memberships and developing new actions, but still we cannot be quick enough to face the performance needs of the association. Coordinated actions among the members are so important nowadays, but our SMEs members are already overcharged, and now the role of EuroVoD is more important to develop a knowledge economy within the sector. Flexibility in the MEDIA funded projects - As Creative Europe is the main funder and key partner in many of these

activities (and of EUROVOD association activities too), we ask you to be as supportive and flexible as possible across existing funding arrangements for our projects. Administrative flexibility in calls and processes is of great help. The Covid-19 crisis has had a profound impact in the ways in which many of the projects are being structured and the kind of expenses and costs incurred (i.e. technical costs, staff costs, research and redesign, though less expenses for travel/hotels etc.). Therefore, we pledge for more flexibility in amending the budget than the current 10% rule in this moment of crisis when we have to

reinvent our activities in a moment of extreme existential pressure and within a very short time. It would also be important to create financing lines to help the platforms with the technological investment needs necessary to maintain the service at a time with such significant growth in demand. There could be also other flexibility measures in the running of the Creative Europe supported projects, especially in potentially extending the 12 or if granted 18 months period of eligibility, would be crucial in enabling the projects to be successfully completed. Even an additional few months, to reflect the time lost due to the crisis, would give the projects the time and space needed to be completed once the Covid-19 crisis is over, as many countries are extending or at the very least postponing deadlines. The postponing or cancelling various activities (training, co-production markets, festivals etc.) will also most certainly bring along a calendar issue (also leading to a shortage of staff, trainers...), which will make further budgetary shifts necessary if additional staff has to be hired. Flexibility concerning budget changes for this exceptional situation would be needed (like staff costs, or overheads/indirect costs). This will give us the necessary support in order to keep our organizations running and guarantee the execution of our projects.

We believe that it is in all our interests to keep our long-term achievements in place and we thank you very much for finding a solution to our concerns. We are continuing to collect data and information of the current situation among our members, and we remain at your disposal in order to find the best way to overcome the difficulties of the sector in the shortest time, as well as preserving the cultural diversity and the circulation of European works.

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