During the pandemic lockdowns and quarantines, many of us expressed gratefulness for the 21st century technology that allowed us to watch films and series on our screens, escaping the worrying health crisis around us. However, few paid attention to the consequences of the domination of the streaming and on-demand services by US interests: while the audience gets more content, European authors are being stripped of their right to royalties.
Why? Because the US model of copyright is different from the European tradition of authors’ right. There, screenwriters and directors are considered as workers: they sign work-for-hire contracts and have no intellectual property rights on their work (which are in the hands of the producers). Here, they are recognised as authors and enjoy all the rights recognised by EU copyright law, including the new principle of appropriate and proportionate remuneration (Article 18 of the DSM Directive). EU countries may use different mechanisms to implement this principle, including collective bargaining and collective rights management. So, even if screenwriters and directors in Europe transfer their exclusive rights to the producer, they should still in principle have a right to remuneration for the exploitation of their works. ‘Should’ because, while some countries support filmmakers in an exemplary way, others unfortunately accept that they are imposed a ‘buy-out contract’ for a lump-sum payment with no collective rights management mechanism providing royalties on the exploitation of their works.
The weight of US interest in top 100 revenues has increased by +4% up to +31% in 2020, due to the rise of the pure subscription video-on-demand (SVOD) players. US-backed audiovisual players in Europe comprised 44% of the main private players’ revenues at the end of 2020. Another trend is that US-players are starting to produce more locally instead of indirect investment, reports the European Audiovisual Observatory.
The US dominance on the VOD market raises concern about the importance to protect our authors’ right tradition and defend European audiovisual authors’ rights on their own creation. Although platforms such as Netflix may seem to have a lot of European works in their catalogues, it does not mean that the production is European (Emily in Paris is a US-example) nor that the authors are getting paid proportionally to the exploitation. In fact, the only ones that do get royalties are authors in countries where a Collective Management Organisation has an agreement with the platform, which is the case of Spain, Italy, France and Belgium. In other countries, in line with the US model, authors are offered ‘buyout deals’ where a director and screenwriter’s remuneration is a lumpsum payment, with no possible royalties based on the success. If the film or series becomes a big hit, the author gets nothing.
US companies dominating the EU market is about whether European authors receive royalties, but it is also a matter of diversity and visibility of European works. It goes without saying that filmmakers want to reach an audience as wide as possible. Many authors are therefore concerned by the domination of US platforms and works on the European market and the lack of space for their works that are often not accessible in their country of origin and/or other EU countries. In terms of making European films and series available on online media, more can be done by market players and public authorities. European platforms must develop, and European works must be made available, regardless of the platforms. Platforms operating in Europe are subject to EU law, including the Copyright Directive (principle of fair remuneration) and the Audiovisual Media Services Directive (quota of European works). Screenwriters and directors should feel reassured that when their works feature on a platform in Europe it is visible and when viewed, the authors receive their fair share of the profit.
The issue of availability and exploitation of audiovisual works across the EU is an important topic currently discussed among stakeholders, as a part of a dialogue initiated by the European Commission. The SAA brings two points to the table: firstly, the importance of exploring all possible ways for authors to be fairly remunerated for the exploitation of their works (Article 18) in the respect of the territoriality of rights, two principles forming the basis of the European audiovisual licensing model. Secondly, the SAA asks the Commission to engage with audiovisual stakeholders about possible financial public support to innovative licensing mechanisms. Such support fits well with new EU MEDIA programme for the period 2021-27 that aims to help the industry address the challenges resulting from the COVID-19 crisis and the growing global competition.
The SAA will keep on supporting European directors and screenwriters, their right to remuneration and the availability of their works!
 Pay TV and cinema on the other hand remains largely European-driven businesses. Read more: Top players in the European AV industry: Ownership and concentration, 2021 Edition. European Audiovisual Observatory, January 2022