Change & Challenges:  European cinemas enter exciting period of transition
Welcome to this, the first in a regular series of updates and opinion pieces from the International Union of Cinemas—UNIC—the European association representing cinema owners across 28 territories. That’s 36,000 screens and €7 billion of box office ($9.3 billion)—a quarter of the global exhibition market.
Starting this November, we intend periodically to use this space to take a closer look at cinema exhibition in Europe—a fragmented yet incredibly exciting and robust cornerstone of the international motion picture industry.
2013 has so far been a year of mixed experiences across the European Union. Germany and the U.K. are seeing significant box-office increases (+7.5 and 8.5 percent, respectively) and there have also been record admissions in Eastern European countries such as Bulgaria (+40 percent) as well as very well-performing local films in Scandinavia.
On the other hand, admissions and revenues are plummeting in Southern Europe as the effects of the economic crisis are further exacerbated by (to our minds) ill-advised national VAT rate increases. As a result, cinemas in these territories continue to struggle to convert their screens to digital technology. (Spain and Italy, for example, are barely halfway through this process.)
For the final quarter of 2013, we look forward to seeing more entertaining and diverse content from our studio partners and the European film community. Given the continued strength of European theatrical exhibition, we are particularly keen to see more major films made with a European audience in mind.
Meanwhile, on another stage, the new political season in Brussels is in full swing. 2013/2014 is an election year in the European Union and—given the rise in political temperatures that always occurs at such times—we are fully expecting to experience activities and statements that have at best a weak grip on reality. No doubt these will include attempts by EU “Telecoms Tsar” Neelie Kroes to portray the film industry as unwilling to embrace change, as well as continued attacks from elsewhere on European copyright rules—the legal basis of our industry’s creative competitiveness.
UNIC challenges our opponents to engage in a sound and evidence-led debate around these issues. Cinema exhibition remains the flagship of the international motion picture value chain and its overall share of total revenues compared to those in home entertainment—including VOD—is growing.
Across Europe, cinemas and their partners have in the last five years invested more than €1.25 billion in cutting-edge digital technology and services. That’s more than any other creative sector of comparable size. Cinemas today offer an incredibly diverse mix of studio content, local films as well as alternative offerings such as opera, theatre and live sports to their audiences. Intricate social-networking technologies and mobile marketing strategies allow us to weave our marketing propositions into the everyday lives of film lovers, positioning cinemas as trusted and creative meeting places in their local communities. The face-to-face social character of the cinemagoing experience sets it miles apart from the day-to-day “noise” that clogs up our Facebook and Twitter accounts.
In times of such rapid change, the key raison d’être of UNIC is to influence political and industry conditions so that theatre owners can provide an unparalleled cinemagoing experience to their audiences. We deal with a range of current legislative and political developments, from better regulating collecting societies, to questions regarding release windows, to the ongoing fight against film theft. Regarding the latter, UNIC helps identify camcording “hotspots” across Europe and assists its members in further improving efforts to locate illegal recording devices in theatres. On another level, we work with partners from distribution, production and the creative community to maintain and improve European rules which ensure that creativity and investments into creative content continue to be rewarded. Together with these partners, we have also set up Creativity Works, a creative sector coalition that aims to improve the image of our industries amongst policy-makers and EU-focused media outlets.
The digital-cinema rollout continues apace and around 80 percent of all theatres across Europe have been converted to date. While we fight to ensure that no screen gets left behind, UNIC also acknowledges that there are technological challenges that have to be addressed after the digital shift is completed. Immersive sound standardization and the future of laser illumination as well as more practical issues such as key delivery require the sector to at times speak with one voice. Our technology group brings together senior technology experts from Europe’s largest operators to ensure UNIC understands their positions when it comes to how cinema exhibition should continue to innovate in a seamlessly connected digital landscape.
From pop-up shops in cinemas to the latest social apps on your phone and tablet, UNIC strives to understand and anticipate changing consumer behavior and how it affects the cinema business. Together with partners Coca-Cola and Orange, we have established two expert committees—the UNIC Retail Group and the Marketing Group—to share experiences and knowledge around the latest innovations in the retail and concessions space and when it comes to reaching out to new audiences in new ways.
The results of these stimulating exchanges will feed into the conference slate at CineEurope, UNIC’s annual convention and Europe’s largest gathering of cinema exhibitors. After two very successful years at our new venue in Barcelona, expectations for the 2014 edition of CineEurope (June 16-19, 2014) are already high and we are in discussions with our partners Prometheus Global Media on potential topics for the program.
UNIC thus spins multiple plates to promote and protect European cinema owners in clearly turbulent yet also incredibly exciting and rewarding times. We look forward to sharing the latest trends and our perspectives regarding European exhibition with you in the future.