The French Streaming Service War

The French Streaming Service War

France has long defended its ‘exception culturelle' with subsidies, quotas and tax breaks to protect French films, music and television from the ravages of a market economy. Now it is preparing to go to battle against the America-based streaming giant, Netflix.

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France’s three biggest broadcasters have set aside their rivalry to form an unprecedented alliance to take on the American colossus with encouragement from the government.

France Télévisions, the state-owned public service network, is joining forces with the main private network, TF1, and M6 to launch a subscription service called Salto next year offering a catalogue of French TV shows and original content. 

Despite the negative reception from state-subsidized local media when Netflix launched in France, the service has gained 3.5 million subscribers in the country. Salto’s initial £45 million budget is dwarfed by the £6 billion Netflix is spending on content this year with hopes that Salto can work as long as it doesn’t position itself as a competitor but as an alternative to Netflix. Salto will also need the green light from Brussels, to ensure that it does not breach EU competition rules. Despite their efforts to appease the French film industry by producing content exclusively for France, it didn’t save Netflix from being banned from the Cannes Festival, which ruled that its films could only compete if they had first been shown in French cinemas.  In 2017, Netflix had 2 films nominated for the Palme d’Or award: Okja and The Meyerowitz Stories. Under pressure from the The Federation of French Cinemas (FNCF), festival organizers announced that in future only films with a cinematic release in France will be eligible for the prize and in 2018, Cannes officials banned Netflix from the competition. This all stems from The French cultural exception.

In France, cinema tickets are taxed and the funds raised subsidizes the country’s domestic film industry. Netflix’s distribution model would drain the French cinema of their funds. In addition, Under the organization’s regulations, a film must take no less than 36 months from cinematic release to its debut on an online streaming service which would be completely incompatible with Netflix’s business model. In spite of these setbacks, Netflix is continuing to produce more French-language series which will premier in late 2018.

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