Study: Value of TV Dramas Imported to Europe Down $1 Billion Since 2008

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BUDAPEST -- The value of drama series -- mostly from the U.S. -- imported into Europe has slumped dramatically over the past four years, according to a new study of 119 channels across the continent.

The new report, compiled by Essential Television Statistics, Madigan Cluff and Digital TV Research, calculates that the value of imported drama series for European broadcasters fell to $5.4 billion last year, down from $5.7 billion in 2011 and a dramatic $1 billion less than the $6.4 billion that imported shows were worth in Europe in 2008.

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The study estimated the total value for imported series by calculating advertising revenues and public broadcasting fees for individual shows based on when and where they were broadcast. Michael Cluff, a co-author of the report, said two thirds of the drop in value can be attributed to an overall slump in advertising revenue and public broadcaster license fees, both consequences of the economic crisis that continues to rock most of Europe.

"The remainder of the drop seems to come from a combination of cash-strapped channels cutting the easiest external costs and the longer term gradual movement of hours out of the high-share channels and into secondary channels," Cluff said.

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While the total volume of hours being sold into Europe has remained relatively steady -- the study finds a drop of just 2 percent, from more than 160,000 imported hours in 2008 to just over 157,000 in 2012 -- the value per hour of drama has slipped significantly, falling 14 percent to an average of $34,290 last year from $39,929 five years ago. In total, the study looked at 1,677 hours of imported drama series for the report.

Italy, one of the country's hardest hit by the European economic crisis, remains the number one country by value for imported drama series, with a total value of $1.062 billion last year, according to the report, closely followed by Germany with $1.047 billion. France is third with $867 million. These top three countries account for more than half the total value of imported drama into Europe, the study found. The U.K. was a distant fourth, with a total value of only $335 million for imported drama series. This is largely because the country's main free-to-air TV channels such as the BBC and ITV air few non-British TV shows.

However, the study is not a complete picture of the studios' fortunes in Europe as it does not include the value for drama series generated by many of Europe's top pay-TV players, as well as new online providers such as Netflix and Amazon's LoveFilm.

British pay-TV operator BSkyB, for example, one operator not included in the report, is a major, deep-pocketed buyer of U.S. drama shows, including Game of Thrones and Mad Men. Netflix and LoveFilm are rolling out operations across Europe -- Netflix recently announced it will launch in the Netherlands later this year following bows in the U.K. and Scandinavia -- and are aggressively signing licensing deals with major studio suppliers.
 

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