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Piracy deals a crippling blow to box office

Spain

MADRID — Whammied by piracy, Spain’s cinema admissions plunged by 6 million to 121.7 million in 2006.

“Piracy’s the No. 1 enemy,” says Tripictures VP Luis Ortiz. “If a film bows in any Spanish-speaking territory, like Puerto Rico, before Spain, it’s accessible online when we open in theaters. The young now prefer Internet to cinemagoing.”

According to research company Gfk, from June 2005 to June 2006, there were 132 million illegal movie downloads in Spain, Europe’s piracy leader.

Despite 5.2% ticket price hikes, total B.O. rose just 0.2% to E636.2 million ($854.0 million) in 2006. Indies took the worst hit, grossing a combined $219.3 million, a 25.7% market share vs. 30.7% in 2005.

“The market’s overflowing with titles. But their theatrical runs are increasingly brief. You need strong films for people to go and see them,” says Enrique Gonzalez Kuhn, head of acquisitions at Spain’s top arthouse distribber-exhibitor Alta Films.

Powerful product could, however, drive a 2007 upturn. “We have to be optimistic: This is the year of the sagas,” says Nielsen EDI’s David Rodriguez.

Also encouraging is the emergence of IPTV platforms with video-on-demand services such as telco giant Telefonica’s Imagenio, which has a 10% pay TV market share. Legal Web download portals — such as Filmotech, FilmStar and MediaXPress — are flowering.

Reportedly, VOD in Spain gives distributors up to a $8,054 per-release per title up front, then a 50/50 revenue split. New operators are sharing revenues on catalog titles.

“If we can defeat piracy, VOD is this business’s future, but the market’s still too immature,” says Alberto Canizares, general manager at Aurum Producciones, Spain’s top indie distrib in the first quarter.

BOX OFFICE OVERVIEW

Top Film 2006:
“Pirates of the Caribbean: Dead Man’s Chest”: $37.5 million
Total B.O.: $854 million
Total number of releases: 466

Recent Pickups
“Death Sentence” (Tripictures)
“La Vie en rose” (Alta Classics)
“The Last Station” (Notro Films)
“Private Fears in Public Places” (Baditri)
“Two Days in Paris” (Golem Distribucion)

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