Claus Ladegaard on streamers obligations, diversity and success with Danish film

As the Danish government is revising the draft of its 6% cultural levy on streaming services and preparing for the next Film Agreement 2024-2028, Ladegaard summaries for us the key areas that need to be addressed to sustain the local audiovisual industry.

2022 has been a very tumultuous year for the Danish audiovisual sector. What lessons can be learnt from last year’s streaming conflict that will have medium-term effects on the industry?
Claus Ladegaard: We weren’t really part of this conflict and I don’t have much to say about this. The really important thing is that now Create Denmark and the Danish Producers Association have agreements with the streamers. Of course, it was a perfect storm-at the same, we got war in Ukraine, inflation, rising of cost of living and streamers invested less in 2022 than in 2021. But hopefully it’s behind us now. The streamers are placing new orders to Danish producers, so we’re pleased with this.

What is the latest update on the proposed 6% cultural levy on streamers’ revenues in Denmark, which is part of the Media Agreement 2022-2025?
CL: My short answer is: we don’t know yet. There are indeed discussions about how to revise the planned 6% levy on streamers revenues. For sure, the new model will have to be a levy combined with investment obligations, if it shall have an impact.

Our standpoint in these discussions, is that we need to define a model that will provide the same financial contribution to Danish films as the originally planned 6% levy and not only an investment obligation, because it will almost entirely benefit series and not films.

Twenty years ago, we used to fund around 30 features a year; this volume has now dropped to 20 features a year and it will continue to decline, if we aren’t able to address this issue.

The best solution right now would be to have a 3% levy on streamers revenues in Denmark that goes to films, as well as investment obligations of say 6-9% that can go to either films or series. That would be an average streaming contribution compared to what is in place in Europe as a whole.

But part of our current coalition government was in favour of the 6% levy and the other part was against it, so we’re waiting to hear the final decision from the government.

So you’re hopeful that Denmark will very soon implement into law the long-awaited obligations on VOD providers as part of the Audiovisual Media Services (AVMS) Directive?
CL: Yes we hope it will become a law this year and that it will be effective from 2024.

What is your personal road map to support the Danish audiovisual industry, while embracing the digital paradigm shift?
CL: Denmark is one of the only countries in Europe where the audience still loves paying for a cinema ticket. Indeed, we haven’t seen streaming really affecting the theatrical sector and the consumption of Danish films on screens.

We have come back strongly from Covid and the second part of 2022 was pretty much a normal year in Denmark. We had a 30% market share for local films last year and we sold more than 3 million tickets to Danish films, which is pre-Covid level.

That said, to maintain our level of production, we need to introduce contribution obligations on VOD services while maintaining our collaborations with streamers.
At the DFI, we do fund series commissioned by the streamers or by national broadcasters, with co-financing from streamers.

Regarding films, we’re still in early days and I hope we can advance the collaboration on film with streamers in the coming years. Some films would benefit from having a theatrical release and a relatively short theatrical window-for example 45 days or even shorter, to be discussed on a single title basis-before premiering on a VOD service. We are engaged in discussions with some of the streamers to collaborate more in this area.

I can see that in Sweden and Norway as well, streamers are more interested in feature films than they were just a few years ago. So we need to find a dialogue, a willingness to find a model that works both for the theatrical sector and the streaming platforms.

Also, we have to discuss the kind of film that we want to support in collaboration with the streamers. It’s a challenge for us to fund the big blockbuster films, so perhaps for those films, we could have a model combining theatrical in Denmark and streaming for the rest of the world. We could also collaborate on genre films or films with a very narrow arthouse audience. Hopefully, once all the countries in Europe will have a clear road map for the AVMS and streamers obligations, we will find formal ways to work with the streamers.

I believe updating the DFI Public Service Fund is on your ’to do’ list. What changes will you introduce? At the recent TV Drama Vision in Göteborg, Zentropa’s Karoline Leth for instance asked for producers to be able to apply for support - alongside broadcasters and streamers…
CL: The modernisation of the Public Service Fund is part of the Media Agreement 2022-2025 and it says clearly that Danish producers themselves can apply for support. It hasn’t yet been implemented but from January 1, 2024, producers, streamers and broadcasters will be able to apply and people can receive funding as well for podcasts.

Before, you could only apply if you were a broadcaster reaching 50% of all households in Denmark. This rule will be amended. So the Public Service Fund will function much more like a normal public funding scheme. I do look forward to receiving applications from producers, as so far only a limited number of broadcasters could apply, which means that we were missing out on a lot of good ideas.

What is the 2023 overall budget of the DFI Public Service Fund?
CL: In 2023 we have DKK 55m-around €7m, and right now the future budget will depend on how the revised cultural levy will be.

As the current Film Agreement 2019-2023 will come to an end this year, what areas do you feel need to be re-evaluated?
CL: The most important decision made on film in Denmark for the last 25 years was part of the Media Agreement. If we get a levy and investment obligations, that will pretty much solve the financing challenges of Danish film. If we want to produce 25+ films a year, improve our support to children’s films, take a risk on arthouse films, and keep supporting high budget films, we need in the area of an extra €15 million a year. If this can be solved, the discussion in the upcoming Film Agreement, will be pretty much on how to work with the streamers, and what to do with kids and youth. This is a true challenge. Not because the quality or number of projects supported is low, but on relative terms, Danish content has become a very small share of what Danish kids are watching. We need to address this in the new Film Agreement.

Also, another topic is how to collaborate with traditional public broadcasters. This was deregulated four years ago, but it has not benefitted Danish films. The financing from broadcasters is still low and a lot of Danish films aren’t being shown on national TV and their streaming platforms, or they are shown 4 years or longer after the theatrical release. We have to readjust those rules.

Other areas that need to be revised include the Regional film funding, as a lot of funding was moved to the regions four years ago. We need to find better - more flexible ways to work with the regions as films are getting too expensive with the existing system.

Gaming is another area to tackle. We are at a crossroad. We should either abandon our current support or raise our ambitions.

In 2018, just after you had been appointed CEO at the DFI, you mentioned three issues that needed to be addressed: adapting to the digital transformation, but also increasing the cultural impact of Danish films, and improving diversity - social, gender, ethnic. Today, do you see concrete improvements in those last two areas?
CL: When it comes to cultural impact, it is part of every discussion between the DFI and producers when they apply. Do films start conversations, help audiences widen their views on the world? This is extremely difficult to measure and it’s still in the making.

When it comes to diversity, five-six years ago, 1 out of 5 features was directed by a woman-now it’s more than 2 out of 5. For the fourth year in a row, we have an equal amount of female lead characters and male lead characters. We have made concrete progress regarding gender representation.

Regarding ethnic diversity, we have worked on this issue for about a decade, but not much has changed unfortunately. It’s a bit disappointing as our approach was the same as with gender diversity. We are still dominantly white in some key positions in the industry, including at the DFI. We need the ethnic groups to be much more involved. Therefore, at the DFI, we’ve set up an advisory board with professionals of non-white background who will suggest changes to what we’re doing and approve our decisions. This is a step in the right direction.

Training, educating the next generation is the best way to implement changes. Are you satisfied with what the DFI is doing in this area?
CL: No, not at all. There was a recent study that said that about 8,000 people work with production of film and television in Denmark and up to 500 of those come from the Danish film school. But still in Denmark, we only talk about the Danish Film School as a reference. We ignore the vast majority of film people that have either no film education or a different type of education. We need to look at the entire education system and people’s access to careers in film and television, to tackle the lack of talent in the industry. And within this educational priority, diversity needs to be addressed.

What can be improved on a Nordic level? Are you still looking into setting up a Nordic scheme for Big Nordic films?
CL: We do have a wonderful tool when it comes to Nordic cooperation in Nordisk Film & TV Fond. I would love to have a Nordic tool as well for high budget films. It might take time to have this, but I’m optimistic. Among film institutes, we’re discussing how to expand our collaboration in Scandinavian Films - not only through promotion, but also co-financing, co-production and sustainability.

How does 2023 look like in terms of quality and diversity of films coming up?
CL: When I look at the films that were released in 2022 and those coming out in 2023, and even further, I think we have found a good balance that we maybe lacked for a couple of years. We have a lot of very strong quality mainstream films as well as daring arthouse films. Last year we had for instance Godland by Hlynur Pálmason and Holy Spider by Ali Abbasi. These are directors who will continue to inspire the rest of the business with festival-driven films in the years to come.

We are in a very good place between arthouse and mainstream, but also regarding business innovation with new companies popping up. I’m quite happy with the current state of Danish film. 2022 was a terrific year for festival attendance of Danish films and their market share at home, and 2023 looks very promising.