Wednesday, April 25News That Matters

Macron at the Movies


By

Netflix

movies likely will be missing from the Cannes Film Festival that opens in southern France next month, and the reason is a classic of French economic dysfunction.

Some of the streaming-service’s movies have been well-received by critics at Cannes in recent years. But this year organizers ruled that only films distributed to movie theaters in France are eligible to enter the competition. That blocks Netflix, which doesn’t show its films in French cinemas.

The policy question for President

Emmanuel Macron

should be: Why not? Netflix does sometimes show films in movie houses, such as last year’s Korean-language “

Okja,

” which appeared in theaters in South Korea and the U.S.

Macron at the Movies

Photo:

istock/getty images

The answer, as always in France, is regulation. For decades Paris has allowed the French film industry to impose a cartel-like rule that a movie can’t be distributed via in-home media such streaming for three years after it’s released in cinemas. Netflix, which has experimented with simultaneous home and theater releases, doesn’t want to wait.

The French movie industry claims the distribution time restriction, known as windowing, is necessary to finance French productions. Windowing gives French broadcasters, which play a significant role in funding French movies, exclusive periods to profit from their investments. Those broadcasters can then also be taxed, as are all cinema-goers, to provide a subsidy for the movie industry.

Netflix has a different plan. It produces local-language content on its own, without recourse to subsidies, and then uses its streaming technology to deliver it to French-speakers around the world. But to do that, Netflix can’t release its films in French cinemas even if doing so might make commercial sense. It also can’t offer French subscribers recent movies licensed from other producers, which is frustrating for consumers whose subscription fees otherwise might help finance more French content.

Only time and corporate earnings calls will tell whether Netflix’s approach is a good strategy, but it’s silly for French filmmakers and politicians to think their local movie industry should be immune to technological advances and business experimentation. Presumably they think limits on the roll-out of gas lighting would have saved French candle-makers.

The French film industry has never been able to agree on a reform, and now the government is threatening to step in. But Paris’s main proposal is to shorten but not eliminate the regulatory window on home release—and only if streaming services pay into the subsidy kitty. Mr. Macron often says he wants to encourage a French tech industry that can rival America’s, and a good start would be to scrap these cinematic rules.

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