Is the Euro Art House Dying?

Courtesy of Courtesy of Cannes; Sundance Selects; Komplizen Film/Sony Pictures Classics; A24

Small-budget, challenging European dramas 'I, Daniel Blake,' 'Elle' and 'Toni Erdmann,' are being celebrated at the European Film Awards this year, but are also the type of films finding it harder to get seen.

The last year has been a great one for "European cinema": the brand of auteur-driven art house filmmaking cultivated by directors from Warsaw to London as an alternative to Hollywood.

Ken Loach's British social welfare drama I, Daniel Blake; Room from Ireland's Lenny Abrahamson; Maren Ade's German dramedy Toni Erdmann; Paul Verhoeven's French-language thriller Elle; and Spanish melodrama Julieta from Pedro Almodovar have been buoyed by critical praise and accolades — even before they were nominated in the category of best European drama at this year's European Film Awards.

Room has already won a Golden Globe, an Oscar and a BAFTA for lead actress Brie Larson, in addition to nearly a hundred other honors, since its premiere at the Toronto Film Festival last year. Elle, Toni Erdmann and I, Daniel Blake were critical standouts from this year's Cannes (where I, Daniel Blake took the Palme d'Or); and after the critical disaster that was his camp airline comedy I'm So Excited!, Julieta marked a return to form for Spanish great Almodovar.

“At least two of those, I, Daniel Blake and Toni Erdmann, are truly extraordinary movies that have something to say about the condition of Europe, which is about the highest praise I can give,” says Hanns-Georg Rodek, head film critic of Germany's Die Welt newspaper. Rodek argues that despite the lower profile of the EFAs compared to U.S. awards (or big national events like Britain's BAFTAS or the Cesars in France), Europe's top film honors have an impressive track record.

“Comparing Oscar winners with the EFA winners over the last 15 years, in two thirds of the cases, the European Film winner is a better movie and one that has better stood the test of time,” he says.

But other trends point to a growing crisis, at least when it comes to the distribution of European movies. A recent study by the European Audiovisual Observatory found that most European films struggle to cross national borders, even within Europe.

While the average U.S. film gets a theatrical release in 10 European countries, a typical European movie only makes it to 2.5 countries, and fully 63 percent of European Union movies were released only in their home country.

The films that do travel, according to industry analyst Martin Kanzler, one of the publishers of the study, tend to be bigger, English-language films, often produced and distributed by a U.S. major studio in Europe. Films like David Yates' Harry Potter prequel Fantastic Beasts and Where to Find Them, which Warner Bros. produced (together with Britain's Heyday Films).

"Demand already exists for big-budget, award-winning English-language films based on familiar content, produced as co-productions and distributed by a U.S. major," says Kanzler. "[But] those are features not shared by the vast majority of European films."

The small-budget, challenging European drama, just the kind of film the European Film Awards celebrates, is finding it harder to get seen.

It's perhaps significant — or troubling, if you're a producer of Euro art house fare — that this year's EFA's lifetime achievement honor will go to Irish actor Pierce Brosnan, a star best known for studio-backed European-set films like those in the James Bond franchise and the ABBA musical Mamma Mia!

Kanzler's study found that three quarters of all European blockbusters, defined as a movie that generates more than 4 million admissions across the EU, were distributed by a U.S. major. And that those films had an average budget above $10 million, “way beyond the budget for the majority of European films,” most of which are made for $5 million or less.

With the exception of Germany and the U.K., film budgets in Europe have actually been on the decline in recent years as producers find themselves squeezed by what the European Audiovisual Observatory has called a “slow crisis” brought about by weak economic conditions, reduced investment by European public broadcasters in film and increasing competition online, either from streaming giants such as Netflix and Amazon or the free-ride of online piracy.

All of those factors are making it harder to produce, and make money off of, the kind of movies that get EFA nominations.

"The importance, in terms of box office, for culturally significant European films has fallen dramatically," admits Hanns-Georg Rodek, head film critic of Germany's Die Welt newspaper. "And we're seeing a much greater break between critical and commercial success." But that, in his view, makes such events as the European Film Awards all the more important.

This story first appeared in the Dec. 16 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.

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