Download 'Fiction film financing in Europe - 2020 Edition' here 

This new report finds that:

• The median budget of a European theatrical fiction film released in 2018 amounted to EUR 1.93 million
• The two most important financing sources were clearly direct public funding and broadcaster investments, representing 26% and 21% of total financing, respectively
• The percentage share of direct public funding in film financing decreases with increasing market size and budget volume.

Based on the actual budget analysis of 568 European live-action fiction films released in 2018, this is probably the largest ongoing pan-European data sample available to date on the financing of European fiction films.  This report is the fruit of an extensive collaboration project between the European Audiovisual Observatory and the European Film Agency Research Network (EFARN). It was authored by Martin Kanzler, Deputy Head of the Observatory’s Department for Market Information.

The report aims at providing concrete annual snapshot figures on how European theatrical fiction films are being financed. This analysis offers a big-picture, a pan-European perspective, and complements work done at national levels. It provides unique fact-based insights on a wide variety of research questions, from the quantification of the average budget of theatrical European fiction films, to the importance of individual financing sources.

Theatrical fiction budgets in Europe

The data sample studied suggests that the mean budget of a European theatrical fiction film released in 2018 represented EUR 3.16 million while the median sample budget amounted to EUR 1.93 million. However, average budgets differ widely among countries. Not surprisingly, average budgets are higher in larger markets and lower in countries with lower box-office potential, as exploitation in national markets remains key for most films. The median budget of a European fiction film originating from France, Germany, Italy or the UK (the large markets included in the sample) amounted to EUR 2.8 million in 2018 compared to EUR 1.7 million for fiction films produced in a medium-sized European market and EUR 1.2 million for fiction films from small markets.

Financing structures for theatrical fiction films in Europe

In 2018, the financing of European theatrical fiction films continued to rely primarily on five financing sources: direct public funding; broadcaster investment; producer investment; pre-sales; and fiscal incentives. The two most important financing sources clearly were direct public funding and broadcaster investment, which accounted for 26% and 21% of total financing, respectively.
However, there appear to be significant structural differences among countries concerning the way in which theatrical fiction films are financed. Some of these differences are apparently linked to market size. 
The two most obvious differences concern direct public funding and pre-sales. The data clearly suggests that the weight of direct public funding in film financing decreases with increasing market size and vice versa. While representing only 20% of total financing in the four large sample markets, public funding accounted for 43% in medium-sized and 54% in small sample markets. 
In contrast, the importance of pre-sales (other than those to broadcasters) as a financing source decreases with market size. Pre-sales tend to be most important in large markets, where they in 2018 accounted for 17%, compared to ‘only’ 8% in medium-sized and small sample markets.

Methodology

The analysis is based on a data sample comprising detailed financing plans for 568 European live-action fiction films - theatrically released in 2018 - from 23 European countries. The data sample includes both 100% national as well as European-majority-led co-productions. It covers a cumulative financing volume of EUR 1.80 billion. The data sample is estimated to cover 49% of the total number of European fiction films released in 2018.