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In Italy, the recessionary ad-spend drop is prompting terrestrial broadcasters to drastically slash their already modest movie buying. Shrinking TV revenue is very bad news for smaller local players who, unlike the country’s top dogs, Medusa and RAI Cinema, aren’t subdivisions of the main webs.

“Now we really have almost everything riding on theatrical,” says BIM Distribuzione topper Valerio De Paolis. “Luckily, admissions haven’t been affected much by the crisis, but it’s still a much tougher market out there.”

Meanwhile, pay TV, which is a monopoly in Italy held by Rupert Murdoch’s Sky Italia, continues to pay peanuts. And Web piracy continues to erode homevid.

De Paolis and others in Italy are hoping the TV sales climate will heat up a bit later this year when RAI and Mediaset get their planned digital terrestrial joint venture, Tivu, up and running. But for the moment, the mantra for Italy’s smaller players is “extreme caution,” as he puts it.

As for the big boys, Silvio Berlusconi’s Medusa will also be “cautious and very selective,” says its acquisitions topper, Faruk Alatan. But that’s more because Medusa, Italy’s No. 2 distributor last year after Universal, already has a pretty full lineup.

CINEMA STATS

Total 2008 box office: $770 million

Total 2008 releases: 845

Biggest indie hit: “Christmas in Rio” ($23 million)

Local breakout for 2009: “Baaria”

PICKUPS:

  • “Season of the Witch” (Medusa)

  • “The Ghost” (RAI Cinema)

  • “The Twilight Saga: New Moon” (Eagle Pictures)

  • “London River” (BIM)

  • “Fame” (Lucky Red)