What Lies Ahead in the Coming Years?
Some Thoughts on International Markets and Festivals

published in Black Box, April 2021
by Björn Jensen

Profound changes have been reshaping the industry for several years now. Even before the pandemic, shifts in consumer behaviour were apparent. Spending on media consumption steadily increased, yet the share of the home video market declined in favour of a continuously expanding VOD market.

On the production side, an increasing number of producers must rely on international partners to finance a growing share of their projects, as domestic production budgets are no longer sufficient - or only partially so. A key factor is that public broadcasters, who have traditionally been essential financing partners in Europe, especially for documentary films, are shifting their priorities. As a result, international co-production and pitching events - such as Hot Docs, Sheffield, IDFA, Sunny Side of the Doc, and others - have become crucial to securing financing. For documentary filmmakers, it is therefore more important than ever to understand the markets they are producing for: knowing the preferences of individual commissioning editors, developing a sense for internationally relevant topics, and mastering cross-border storytelling.

Travel Costs and Accreditation
Many European and other countries consistently support their producers during a project’s development phase, subsidizing travel and accreditation costs, sometimes quite substantially. In Germany, there used to be modest subsidies, but this support has since disappeared, placing German documentary filmmakers in the lower third of Europe in terms of development support, as a 2016 study by the European Documentary Network and AG DOK revealed.

While these subsidies were never generous, the gap is striking: an Australian film production company pitching in China could expect higher travel support than the budget for the entire German delegation. AG DOK has long been lobbying for a return to effective travel cost support, at least to provide German documentary professionals with a basic level of assistance during this critical development stage.

Rising Competition
International co-productions are becoming increasingly common. For producers, financing is more difficult; for audiences, navigating the flood of globally available content is increasingly overwhelming. Festivals play an important role here by acting as filters and orientation platforms. They give projects and completed films a stage, encourage debate, generate press worthy events, create spaces for encounters and experiences, and form a vital building block in a film’s development - provided they represent a relevant and sufficiently large industry market.

Winners of the Pandemic
SVOD platforms such as Netflix, Amazon, Disney and others are exerting ever more pressure on linear television. Public broadcasters, meanwhile, are realizing that younger audiences are turning away from linear formats. When younger viewers do engage with public service programming, they mostly do so via streaming services. Arte, for instance, reports that some of its programs now reach more viewers through its online library than through television broadcasts.

What does this mean for the future of linear TV? Even before the pandemic, global SVOD revenues had surpassed those of pay-tv, and the COVID pandemic accelerated this shift dramatically. With cinemas closed worldwide, SVOD platforms made massive gains as studios skipped theatrical releases and debuted films directly on their affiliated platforms.

According to industry service DTVE, Netflix now has over 203 million subscribers and increased its operating profit in 2020 by 76% to USD 4.6 billion. Amazon Prime has reached 137 million subscribers, while China’s iQiyi, Tencent Video, and Youku together account for just under 300 million. The biggest winner, however, is Disney+, which grew to 95 million subscribers - hitting its four-year target in just 14 months. Researchandmarkets.com projects that by 2025, one in three households will subscribe to at least one SVOD service.

Festivals – Hybrid Forever?
In 2020, nearly all festivals, markets, and industry events were either cancelled, moved online, or held as hybrid versions - small physical events combined with online extensions. Festivals fared somewhat better, as streaming films is relatively straightforward, whereas replicating the full experience of a co-production market - both formal and informal networking - is much harder and inevitably inferior to onsite encounters.

Festivals responded with varying levels of success. Particularly strong examples include CPH:DOX in Copenhagen, Dok.fest Munich, and the World Congress of Science and Factual Producers. Munich’s online edition, for instance, was made available nationwide, reaching audiences in rural areas and other cities and boosting ticket sales from around 40,000 in 2019 to more than 70,000 in 2020. Many organizers have indicated that they plan to maintain hybrid formats in the future, recognizing their potential to reach previously untapped audiences and expand their impact.

The big question is whether a temporary online festival presentation cannibalizes subsequent theatrical runs. While this remains to be seen, it seems unlikely. More probable is that the media attention generated by festivals will boost films’ theatrical prospects—provided distributors and festivals coordinate clearly on marketing, revenue sharing, and screening fees.

Industry Events Under Pressure
Markets, however, are a different story. Sunny Side of the Doc and MIPTV struggled in 2020 to deliver effective pitching opportunities. MIPCOM failed to replicate organized group and one-on-one meetings online, while the WCSFP managed relatively well. Digital booths - virtual company or country stands - did not prove effective, and the informal networking and parties so essential to such events could not be meaningfully translated online.

Pre-recorded panels often lacked the spontaneity of live events, though the ability to access them for weeks afterward was seen as a benefit. Many participants expressed hope that this option will continue alongside future onsite events, allowing them to prioritize in-person networking while still accessing recorded sessions later.

Outlook for 2021
Will there be a simple return to “business as usual”? Or will impulses from the pandemic era shape the future? How will audiences behave? Will there be a rush back to cinemas and festivals, or will caution prevail?

A cautious forecast suggests that festivals, markets, and events will remain largely online throughout 2021 (and possibly into 2022). Much depends on vaccination rollout, efficacy against variants, and entry restrictions. While festivals may even see growth opportunities, markets and industry events - so dependent on personal contact - face steep challenges.

Online Fatigue
Among documentary professionals, fatigue with online events has set in. Panels have often felt weaker, and no-show rates were high, with many registered participants failing to attend live sessions. This made networking less effective. Yet adaptation is taking place. In February, Sunny Side of the Doc launched “Global Pitch,” an online pilot for its June edition, which is planned as a hybrid. Twelve international projects were selected; four production companies entered substantive talks with broadcasters they had not previously connected with - a noteworthy 30% success rate, even by in-person standards.

Film sales appear less dependent on physical markets. With fewer films being produced last year, demand for completed titles was strong, leading some sales agents to record their best year ever. Theatrical distributors, however, suffered greatly from lockdowns.

Intensifying Competition
The first festival or market able to resume as a full onsite event is likely to see exceptional attendance. Demand for new content will surge in 2021 and 2022, as projects accumulated during the long hiatus seek financing. This will increase competition significantly - challenging times ahead for producers and documentary filmmakers.

Adjusting Funding Policies
The cultural sector has been hit especially hard by lockdowns, and international competition will make it even more difficult to recover financially. Without stronger state and institutional support, German documentary filmmaking will struggle for years to regain ground.

Funding guidelines must adapt to the “new normal” and evolving consumption patterns. In particular, greater and more consistent support is needed for the development phase of projects. A crucial first step would be to restore and expand travel cost subsidies, enabling German filmmakers to participate in international festivals, markets, and industry events.

The Future of Theatrical Exhibition
Audience behaviour may shift permanently post-pandemic. While many will welcome the chance to return to cinemas, Germany’s average pre-crisis attendance was already low - fewer than two visits per year. Some may hesitate to return to crowded theatres. At the same time, many were introduced to streaming for the first time in 2020.

Of course, the cinematic experience cannot be replicated in the living room, regardless of screen size. Yet streaming is cheaper, more convenient, offers greater choice, and - unlike cinemas - comes without lengthy advertising blocks. The danger is that the pandemic will deepen the crisis for theatres.

A return to the old status quo is unlikely. Cinemas must adapt, highlight their unique strengths, and society must not abandon them. They remain vital cultural and social spaces, offering shared experiences that home viewing cannot match. At their best, they still conjure the magic of moving images that has captivated audiences for over 120 years.

Festivals, in turn, function as the beating heart of this ecosystem - curating, presenting, and creating events and spaces of encounter. The relationships among producers, cinemas, festivals, broadcasters, and streaming platforms will need to be redefined. For German documentary cinema - and not only that - adapting support structures to these new realities will be more crucial than ever to ensure an international future.