Austrian government bails out ORF

Strapped pubcaster gets $240 million

BERLIN The Austrian government has come to the rescue of financially strapped pubcaster ORF, pumping in E160 million ($240 million) to stem the red ink following two years of dramatic revenue decline.

ORF’s market share has fallen steadily from 49.7% in 1998 to 39.3% in 2008 as more channels, including local commercial web ATV and German broadcasters ProSiebenSat.1 and RTL, vie for viewers.

The pubcaster has not turned a profit since 2007 when it made a meagre $5.5 million on total revenue of $1.37 billion, including $707 million from license fees and $449 million from advertising.

With advertising income continuing to sink and hard-up viewers excused the license fee, ORF execs were bracing for revs of $1.26 billion and a deficit of some $80 million this year.

Thanks to the government boost, ORF’s 2010 budget will be up to around $1.35 billion. The state aid will be handed out over the next four years, some $75 million in 2010 and 2011 and around $45 million for each of the consecutive two years.

ORF has frequently exceeded its budget in previous years, a situation made worse by the economic downturn.

The exec tasked to put ORF back into the black by 2010 is Alexander Wrabetz, who took the reins in 2007.

Wrabetz is restructuring the pubcaster and attempting to cut expenditure by some $300 million.

ORF is chopping $18 million from its programming budget, downsized to $263 million in 2010, but the $260 million aid package guarantees continued support for feature films and scripted fare.

ORF agreed to raise film subsidy contributions by 30% from $8.8 million to $11.9 million a year, calming the fears of local filmmakers following months of wrangling.

Wrabetz has drawn the scorn of filmmakers for openly questioning ORF’s role as one of the main pillars of Austria’s film industry.

Industryites loudly protested Wrabetz’s cuts and even pushed ORF for an increase in film support to around $15 million a year.

Wolfgang Reiter, a spokesman for film industry initiative Plattform Filmwirtschaft und Filmkultur mit dem ORF, says the pubcaster’s decision is satisfactory in view of the difficult economic situation.

“It’s not 100% what we wanted, but it’s part of the political process to compromise and we are satisfied with the result.”

With the recent success of Austrian films at home and abroad, the government has been hard-pressed to allow any cuts in film funding.

The Austrian box office broke the 1 million mark in admissions for the first time ever this year with major local hits including Kurt Ockermueller’s comedy drama “Echte Wiener — Die Sackbauer Saga” and Wolfgang Murnberger’s comedy thriller “Der Knockenmann.”

In addition, Stefan Ruzowitzky’s foreign language Oscar winner “The Counterfeiters,” Michael Haneke’s Palm d’Or recipient “The White Ribbon” and Jessica Hausner’s fest fave “Lourdes” have catapulted Austrian film to the fore.

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