Business model

US streamers are shaking up the business model of European television

As US streamers continue to drive local market growth, continental European TV producers juggle the Hollywood studio business model – under which Netflix and others get all the rights in return for full funding more costs – and the pre-existing European model based on co-productions which leaves the backend to independent producers and gives them more creative control.

But that is starting to change.

Thanks to the European Audiovisual Media Services Directive (AVMS) – currently in various stages of implementation across Europe – there are early indications that giant platforms are slowly becoming more open to flexibly structured deals. Or, at least, that’s the hope for the future.

Basically, the directive simply states that streamers must offer a 30% quota of European content to European subscribers. But on top of that, EU countries are introducing country-specific legislation for streamers to directly reinvest a percentage of their earnings in each European country where they operate. And some countries – like France and Italy – are in the process of writing into law new rules that will also force Netflix, Amazon Prime, Disney Plus and other streaming services to invest locally through independent producers and to guarantee that producers will retain part of the rights.

“First of all, we welcome all investments from streamers in all countries in Europe,” says Martin Moszkowicz, Chairman of the Board of German powerhouse Constantin Film. He notes that platforms such as Netflix, Amazon Prime Video and Disney Plus “are already investing a lot of money across Europe in the local language”. [content] and also in international broadcasts in English.

A recent report by London-based firm Enders Analysis states that many European producers “have come to prioritize streaming platforms when showcasing their best projects”. He also points out that Netflix is ​​considered the biggest commissioner of European scripted content in 2020 – ahead of major public broadcasters in the EU – and that Disney now has 60 European skeins in the works for delivery by 2024.
But while Moszkowicz welcomes the streaming giants as investors, he says their business model is “ridiculous”.

“No rights are retained; there is no advantage,” he notes. “There’s nothing that we — and also the artists, the creatives we employ — partake of in the billions and billions of dollars in hits that streamers have.”

Moszkowicz says that German producers will “use AVMS as much as possible to get a bigger slice of the pie” and believes that “in the end we will succeed”.

Here’s a look at the state of play in the standoff between the streaming giants and producers in the four main continental European territories.


France, where the government recently approved AVMS regulations, is leading the way.

Under the new rules, two-thirds of streamers’ investment must go into deals for independent productions to which the rights will revert to French producers after 36 months.

This means that a third of streamers’ investments will continue to go into broadcast deals with French producers under flat-rate pacts that won’t allow them to retain the rights.

But despite being a historic settlement, the new rules raise questions about how these investment obligations will be applied and to whom.

The rules create competition between French producers to be included in the “two-thirds investment” corridor, says French producer Alexandra Lebret, chief executive of lobby group European Producers Club.

“How will streamers select which producers can retain the rights, and which cannot? ” she asks.

In early March, Netflix announced more than 200 million euros ($220 million) in investments in France by unveiling its 2022 list of 25 French originals, including 10 TV series.

These include “Standing-Up”, on the French comedy scene, directed by the creator of “Call My Agent”, Fanny Herrero.

Lebret points out that it is not yet clear how Netflix will select the projects that will benefit from the new rules and points out that Netflix’s biggest French original, “Lupin”, which is currently filming its third season, is still being made as part of a package .


In Germany, where Audiovisual Media Services Directive regulations are expected to be in place soon, streamers have shown sporadic flexibility when structuring deals for high-profile productions.

“The more interesting the property, the better your chances of getting out of it [structuring a deal where rights revert]says Moszkowicz.

A typical example is Constantin’s series “We the Children of Bahnhof Zoo”, which was released on Amazon Prime Video in Germany.

It was also co-produced with several partners, including Cattleya, owned by ITV, in Italy, with Fremantle handling international sales.

Constantin is now editing the high-end television series “Smilla’s Sense of Snow,” based on Peter Hoeg’s thriller, for which Moszkowicz is confident he can mount a co-production combining streaming partners and other types of broadcasters.

Moszkowicz also points out that when it comes to pitching big-budget projects, European public broadcasters and pay-TV players still represent a viable alternative to streamers.

Last year, Constantin and German TV veteran Herbert Kloiber joined forces to form a company called High End Prods. produce special event programs for the European free-to-air and pay-TV market.
Moszkowicz notes that the combined resources of ad broadcasters, like ARD and ZDF in Germany, TFI in France, RAI in Italy and the BBC in the UK, are far larger than the budget of any one streamer.

“It’s practically billions every year and they don’t get enough product, obviously because a lot of really cool stuff is being bought around the world by streamers,” he says.

High End will soon announce its first slate.


In Spain, even though the AVMS has not been fully implemented, there is a feeling that streamers are giving in to their diktat of all rights.

“I think at first they tried to divide and conquer,” says producer-director Alvaro Longoria, who runs Spanish independent Morena Films.

But now many other players have entered, including Disney, Apple and Paramount.

“A lot of them realize they have to be flexible if they want to attract top talent,” he adds.

Longoria, whose Christmas comedy feature ‘Reyes vs. Santa’ was acquired by Amazon for certain territories, adds that he finds it symbolically significant that Netflix is ​​taking on ‘Parallel Mothers’, Pedro Almodóvar’s latest film – which as that president of the Cannes jury in 2017 slammed the streamer.

Netflix has just taken the exclusive Latin American rights to “Parallel Mothers”.

“The whole business model changes all the time and streamers are the first to adapt with pleasure,” he says.


In Italy, where AVMS implementation is still languishing, there are weak but significant signals that streamers are beginning to move.

“Certain dynamics with the platforms are changing,” says Rosario Rinaldo, head of production company Cross Prods., which is owned by Germany’s Beta Film.

Cross is producing the edgy Amazon Italy Original drama “Prisma,” for which he will have the SVOD rights in perpetuity.

Rinaldo will be allowed to sell the free TV rights to “Prisma” worldwide after the show airs exclusively on Amazon globally for a certain period.

“There’s more attention paid to producers’ needs during development,” Rosario said, citing Netflix and Disney’s willingness to co-develop projects with Cross.

The best example in the Italian market of a major American actor willing to engage with the European co-production model is HBO and public broadcaster RAI’s “My Brilliant Friend”, the series based on Elena Ferrante’s novels.

In early February, the series’ third installment, “Those Who Leave and Those Who Stay”, aired on RAI to stellar ratings before launching in the US on HBO and HBO Max.

“As a producer, looking for forms of collaboration between different types of platforms and other broadcasters, including public broadcasters, is clearly part of what I’m looking for,” says Lorenzo Mieli, producer of “My Brilliant Friend”. .

Recently, Mieli, through her apartment belonging to Fremantle, was able to mount a three-way co-production between RAI, the Franco-German network Arte and Netflix.

They are preparing veteran author Marco Bellocchio’s upcoming television series ‘Eastern Notte’, about the kidnapping and assassination of former Italian Prime Minister Aldo Moro by Red Brigades terrorists.

“The potential for business models to evolve — and disrupt monolithic ones — is born out of our ability as producers to come up with projects that are worth that disruption,” he says.