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Arthouses hedge bets

Specialty screens are up in Europe, but exhibitors play it safe with genre fare

There are many doomsayers in the European biz who would have you believe that arthouse cinema across the continent is in peril: Audiences are shrinking, theaters are closing, and the end is nigh. But, while there are major challenges facing the sector, the overall picture is less bleak.

Last year, 1,168 films were produced in the European Union compared with 911 in 2005. The box office share for European films has shifted from around 25% in 2005 to 27% last year, but the size of the cake has grown. B.O. gross in the EU last year reached a record high of €6.27 billion ($8.6 billion), up 12% year on year.

The number of arthouse theaters in most Western European markets has either remained constant or, in a few cases, risen over the past 15 years, according to the latest count by Media Salles, the European exhibition agency. However, Germany has seen a significant fall — with 317 theaters, it represents a third of France’s figures — but still has far more than the U.K. at 172.

But structural changes within the broader entertainment biz have squeezed the margins of arthouse distribs. As the television market has fragmented, TV companies have cut the number of arthouse films they buy and the prices they pay. The DVD market is collapsing, and video-on-demand has yet to compensate for the loss of revenue. Conversion to digital projection in theaters has proved costly and has tended to favor mainstream pics (in particular 3D movies) and alternative content (such as opera) at the expense of arthouse films.

When Robert Beeson, topper at U.K. distrib New Wave Films, recently went looking for screens for “Uncle Boonmee Who Can Recall His Past Lives,” he found that half the arthouses were planning to show “Harry Potter and the Deathly Hallows: Part 1.” “As a whole, their programming is a lot less adventurous than it used to be,” he says.

Some in the indie distribution sector have responded to these difficulties by releasing more mainstream pics — a move reflected in the European Film Awards, where many of the nominees are thrillers, including Daniel Monzon’s “Cell 211,” Roman Polanski’s “The Ghost Writer” and Olivier Assayas’ “Carlos.”

According to Peter Buckingham, head of distribution and exhibition at Blighty state film agency the U.K. Film Council, U.K. moviegoing is up — and more diverse than ever: In 2003, 213 specialty pics were released in the U.K., and they earned £41 million ($65.4 million), 5% of the total B.O. Last year, 347 specialty films were released, earning £173 million ($276 million), 15% of the total gross.

Antonio Medici, general director at Italy’s Bim Distribuzione, insists that indie exhibitors and distributors should be more proactive. Arthouse companies need to adopt the marketing techniques found in other consumer businesses, he argues, and distribs should release fewer films and devote more time and resources to promoting those they do release.

“The world has changed, but they are still doing business in the same way they did 10 or 15 years ago,” Medici says.

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