Broadcasters pour $500 mil into industry

This decade, Spanish broadcasters have poured more than $500 million into Spanish film. Private webs Telecinco and Antena 3 as well as pubcaster RTVE are Spain’s new majors.

In force since 1999, Spain’s version of the EU Television Without Frontiers Directive obliges local broadcasters to earmark 5% yearly income to finance Spanish and European films and TV movies.

That’s a large obligation that gives the networks considerable financing muscle.

“As a producer, you need a TV operator involved to make a large project out of Spain,” says Juan Gordon, co-founder of Morena Films, which teamed with Telecinco and Wild Bunch to co-produce Steven Soderbergh’s “Che.”

“Some international producers think Spanish TV companies are investment funds. But we produce and influence films like any other producer,” says Telecinco Cinema CEO Alvaro Augustin.

“One consequence of Spanish TV hegemony is bigger film budgets,” Gordon says. Another is getting into Spain’s B.O. top 10 this year.

Through Aug. 10, Spain’s 10 highest-grossing pics included seven titles produced by Telecinco Cinema or Antena 3 Films. “We care about the spectator and make more commercial films,” asserts Mercedes Gamero, director general of Antena 3 Films (A3F).

A change in TV funding can speed winds of change through the whole industry. In June, new management at pubcaster CRTVE announced it will match 2007’s E34 million ($49.9 million) film investment this year but scale back fiction feature financing from 55 pics in 2007 to 35-37.

“For (CRTVE’s TV arm) TVE, it’s very important to continue supporting Spanish film production,” says TVE head of cinema Gustavo Ferrada. “But, as a ‘mixed’ pubcaster, it’s also very important to balance our objectives of generating an economic return and performing a public service.”

TVE is betting on three types of projects:

  • Initially five feature films a year, rising to 12 in the future, with large market and advertising potential, for primetime slots on TVE commercial web La 1. “We need films that generate a minimum 2 (to) 2.5 million viewers,” Ferrada says.

  • Nearly 16 pics with more creative risk, fulfilling a public service remit: prestige productions; Basque-, Galician- and Catalan-language films; experimental projects; new talent pics; and fest players.

  • Some 10 Spanish midrange-budgeted pics ($3 million-$6 million each). According to Ferrada, given plunging DVD return and a box office polarizing between blockbuster hits and low-budget breakouts, “These projects will be the hardest to finance in coming years.”

Investing more in commercial pics, TVE will often take more rights, such as DVD and a slice of international.

It has acquired some of Spain’s biggest director-driven upcoming pics: “The Hanged Man,” a drama of teen sexual and emotional initiation from Manuel Gomez Pereira; Pedro Almodovar’s “Broken Embraces”; Fernando Trueba’s return to fiction, “Victory Dance”; and Joaquin Oristrell’s romantic comedy “Mediterranean Food.” TVE takes rights; Antena 3 and Telecinco share copyright, co-producing.

Producer of “The Orphanage” and “Pan’s Labyrinth,” Telecinco Cinema — if it hits quota obligations — will plow $64.7 million into film production in 2008.

It boards some 10 projects a year: one or two bigger titles, with budgets over $7.5 million, helmed by Spanish or international name directors; the rest, lower budget, often films driven by new talent.

Telecinco is now co-financing Alejandro Amenabar’s epic “Agora,” toplining Rachel Weisz and bowing in 2009.

But film investment isn’t a cash cow. “We try to recover the maximum from investment. But we can’t talk about upside,” Augustin admits.

“If pic investment were profitable, the 5% obligation wouldn’t exist,” says Gamero, who recognizes that A3F is changing its strategy, redirecting part of its investment commitment to films for TV, producing two-episode miniseries. “TV’s our core business,” she explains.

With around $61 million to spend in 2008, A3F’s film projects include:

  • “La voz dormida,” by Benito Zambrano (“Alone”), a Spanish Civil War women’s drama, inspired by the last novel of writer Dulce Chacon.

  • “The Chinese Manuscript,” an English-language, $14.7 million 16th-century adventure film, with Zebra Prods. Pre-production began this month begins September.

  • “14” (aka “Lope”), a $17.6 million biopic of Spanish playwright Lope de Vega, played by Daniel Bruehl, shooting early 2009.
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