Analysis A new report from the European Audiovisual Observatory shows what a sorry state European TV and film production is in when compared with the US market, and shows that US programming is increasing its stranglehold on European TV and video services.

While the initial functions of the European Audiovisual Observatory were mostly about counting how many TV channels there are around Europe, as the project has progressed it has unearthed more and more important details.

The one out this week shows that the share Europe has in audiovisual service (cinema, television, on-demand services, recorded music and video games) is now just 12.5 per cent at the end of 2013, compared to 17.1 per cent in 2009. The market share of content from the US rose from 57.7 per cent to 66.4 per cent.

This shows how European policy is in abject retreat despite a huge political stand by France in particular. France, with its substantial subsidies for locally produced content, is still completely failing to halt the shift to US content – with all that entails – a drift to US moral codes and values, including its endemic gun culture. Europeans have no guns, but our children go around pointing their finger and saying “bang, bang” all the time.

The BBC in the UK is often held up as a shining example of what public service broadcasting can do to retain local flavour, but across Europe total revenues of public service broadcasters in 2012 came to €32.6bn, a fall from €33.4bn in 2009, a drop of some €800m. The drop is larger if you take inflation into account.

If you look at the BBC alone, supported primarily by the licence fee and some €1.7bn in its BBC Worldwide sales, its revenues have gone up by over €500m during that time, from €5.9bn to €6.46bn, about 20 per cent of the total for Europe spent in one country. However, in 2012, the Observatory points out, its public funding accounted for 76.2 per cent of these revenues. The other 23.8 per cent (some €7bn) came from advertising, subscription fees TV fees and sale of content rights.

Pay TV in Europe, rather unlike the US, is still on the rise. But this is not so much down to more subscribers, mostly it is down to rising ARPU, based around price rises, where consumers will tolerate them.

The turnover of the 19 main European commercial TV groups rose just 1 per cent in 2013. However the groups that relied on pay TV posted growth of 1.5 per cent, and the free-to-air broadcasters' revenue actually fell in 2013, despite advertising revenues recovering in many Western European countries. The fall was just 0.1 per cent, but it is the direction that counts.

In 2013, the Observatory said that the European pay TV sector had 7,898 operators in 37 countries, way down on the 2009 figure, some 6 per cent off. This can be explained by consolidation, particularly in the cable sector, which is consolidating the fastest, and where there was a fall of some 518 operators. Much of this is explained by technology advances allowing for multiple-dwelling units (or MDUs - for an example a block of flats) to let the cable operator have a direct relationship with each home in an MDU complex, rather than having to bulk order programming and behave like a cable company in their own right.

But interestingly, much the same thing has gone on in mobile, with the Observatory noting that only 53 mobile operators offer TV in 2013, compared with 77 back in 2009.

Satellite suppliers across the region have gone up, from 73 to 80 and pay digital terrestrial television operators have risen from 25 to 33, despite several notable business failures. It is IPTV platforms that are on the rise – going from 127 in 2009 to 181 in 2013.

In the US, programmes which were either fully or partially funded in Europe amounted to just 8.2 per cent of the total in 2012 and that included 7 per cent for co-productions or co-financed productions with European producers.

By comparison, the proportion of US fiction in the programming of a sample of European channels consistently exceeds 52 per cent of all programming, while 59.5 per cent of VoD services available in the European Union are controlled by US groups.

The Yearbook can be ordered from the European Audiovisual Observatory’s website.

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