REPORT FROM THE COMMISSION TO THE COUNCIL, THE EUROPEAN PARLIAMENT AND THE ECONOMIC AND SOCIAL COMMITTEE - SECOND ANNUAL REPORT ON PROGRESS IN IMPLEMENTING THE ACTION PLAN FOR THE INTRODUCTION OF ADVANCED TELEVISION SERVICES IN EUROPE
Date: 1996-07-26
Institutions: European Commission
Subjects: action programme, audiovisual communications policy, audiovisual production, electronics industry, high-definition television

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

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Bnissels, 26.07 1996 
COM(96)  346 final 

KKWRT MWM THM COMMISSION 

IV  m  COUNCIL,  im  EWOPfcAN IttftUAMfcN T 
AND THE ECONOMIC AND SOCIAL COMMITTEE 

SECOND ANNUAL REPORT 

ON PROGRESS IN IMPLEMENTING 

THE ACTION PLAN FOR THE INTRODUCTION OF 

ADVANCED TELEVISION SERVICES IN EUROPE 

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2 

JOINT INTRODUCTION 

JOINT EXECUTIVE SUMMARY 

« 

SECTION A : BROADCASTING 

: 

1.  MANAGEMENT OF THE ACTION PLAN 

1.1  Call 95/1 

1.2.  Call 95/3 

1.3.  Evaluation methodology 

; 

1.4  Building on the excellent foundation set down in earlier years 

2. 

IMPACT 

2.1.  How 16:9 broadcasting triggers sales of 16:9 TV sets 

2.2.  The  strategic  importance  of  16:9  TV  sets  to  the  consumer 

electronics industry 

3.  PROSPECTS FOR 1996 AND 1997 

3.1.  The issue of critical mass 

APPENDIX 

SECTION B : PRODUCTION 

INTRODUCTION 

The Action Plan, a Community instrument for the audiovisual sector 

The 16:9 market 

The Action Plan, an integral part of the Community audiovisual policy 

Scope of the Action Plan 

4 

5 

9 

9 

9 

12 

13 

13 

16 

\6 

17 

19 

19 

21 

23 

23 

23 

23 

23 

24 

3 

CHAPTER  1  -  16:9 ACTION PLAN  1993-95 

1.1  Overall results expressed in ecu andhours: 

1.2  Proposals (production and remastering projects) received under the 

Action Plan.. 

1.3  The professionals involved 

mv 

1.3.1  General analysis 

1.3.2 

Independent producers 

1.3.3 

Broadcasters 

1.3.4 

The 16:9 European map 

CHAPTER 2 - RESULTS OF THE ACTION PLAN 

2.1  New productions 

2.1.1 

Types of  16:9 programmes 

2.1.2 

Programmes analysed by format 

2.2  Remastering 

2.3  Professional equipment 

CONCLUSIONS 

Expanding the audiovisual catalogues 

A partnership for a dynamic  16:9 market 

The programmes industry invests in the future at European level 

25 

25 

25 

27 

27 

.....29 

29 

30 

....31 

31 

31 

34 

35 

36 

38 

38 

38 

38 

GENERAL CONCLUSIONS 

.........39 

International competition and innovation 

Integration  of  the  new  technologies  into  the  European  audiovisual 

industry 

ANNEX  1 

ANNEX 2 

39 

39 

40 

41 

JOINT INTRODUCTION 

The  Aclion  Plan  for  the  Introduction of  Advanced  Television  Services  in Europe was  established  by 
the Council  Decision  of  22  July  1993  (O.J. No.  L  196/4R, S.R.93) with the objective  of  ensuring  the 
accelerated  development  of  Uic  market  for  advanced  television  services  in  Europe  using  the  wide-
screen  16:9  format 

The  approach  is  based  on  stimulating  tlic  broadcasting  and  programme  production ..elements  in  the 
value  chain  so  that  all  the  different  actors  and elements  in  the  television  services  chain  necessary  to 
deliver  16:9  services  to  the  home  could  fall  into  place.  This  is  a  condition  for  achieving  the 
accelerated development of the market for  16:9 services.  In the light of this approach, the Action  Plan 
lays down two indicative targets to be achieved during its life: 

(i)  Ma critical mass of advanced television services in the  16:9 format; 

(ii)  a  sufficient  and  increasing  volume  of  programming  in  the  16:9  format  and  with  high  technical 
quality both in picture and sound and of such a nature as to facilitate an optimum audience rating, 
such programming to be broadcast in the above mentioned services". 

To achieve these targets, Community funds of 228  MECUs were foreseen  for the period mid-993  until 
mid-1997. 

The  Action  Plan  Decision  requires the presentation  of a report annually to the Council,  the  Ruropeon 
Parliament  and  the  Rconomic  and  Social  Committee  on  (he  activities  of  the  preceding  year.  This 
Communication presents the Report for  1995. 

The  Second Annual  Réport focuses  on the activities carried out during  1995 and the results to date in 
achieving  the objectives  of the  Plan.  Section  A  deals with the Broadcasting  part (objective  (i)  above) 
and  Section  B deals  with  the Programme  Production  part (objective  (u) above).  Activities  up to  the 
end of  1994 were reported on in a previous report (COM (95) 263 final,  16.7.95). 

This  Report  appears  at a time  of  intense  speculation  regarding  the future  of  broadcasting,  faced  with 
the  prospect of new,  non-broadcast  media  such as video-on-demand  and the  Internet.  There  iralso  a 
revolution  underway  in  broadcasting  itself: pay-TV  operators  are  poised  to  launch digital  television 
services  on  cable  and  satellite.  Preparations  are  underway  for  the  launch  of  digital  terrestrial 
television.  The  transition  to  digital  television  has  a  key  role  in  ensuring  that  broadcasting  remains 
attractive in the face of  new competition.  The introduction of digital television  is however not the only 
important transition underway which will shape the future. 

The Report covers the other important transition in broadcasting: changing  the screen  fonnat  from  the 
ukl  1930s  film  formal in iho proportions 4:3  to the globally-agreed  16:9 wide-screen fonnat.  This is a 
difficult  task,  but  an  important  one  because  of the commercial,  creative  and technical  possibilities  it 
opens both for the industry players and the public. 

tu  digital 
The  transition  to  wide-screen 
technology.  In several ways, it's much harder than introducing digital TV, which can be just a decoder 
box  plugged  into an existing  TV  set.  Introducing wide-screen means changing the  architecture  of  the 
TV set itself. 

is  complementary  with  the  transition  from  analogs 

This  Report  shows  how  the  Aclion  Plan  for  the  Introduction  of  Advanced  Television  Services  has 
triggered  the  tïrst  stage  in  the  transition  from  the  old  screen  fonnat  to  the  16:9  wide-screen. 
It 
describes  die  progress  sinco  last  year's report and the  future  prospects  of  this  important  programme; 
and how wide-screen  Is already contributing to the future of broadcasting today. 

Second  Annual  Report  on  Progress  in  Implementing 

the Action  Plan  for  the Introduction  of 

Advanced  Television  Services  in  Europe 

JOINT EXECUTIVE SUMMARY 

The most important barrier to the introduction of wide-screen TV has been 
the structural separation of consumer electronics and broadcasting.  The so 
called 'chicken and egg' syndrome meant that broadcasters would not introduce 
wide-screen  until  TV  receivers  were  generally  available  while  manufacturers 
would not commit to mass-producing receivers until there was broadcasting.  The 
.  Action  Plan's first  task was to address this by  offering  a financial  contribution 
towards  the  extra  costs  of  broadcasters  and  programme  producers  so  that 
manufacturers could market wide-screen TVs with confidence. 

Please  turn  to  Appendix  -  page  21, "Frequently  Asked  Questions"  for  further 
detail on the rationale behind the Action Plan. 

See  Figures  1A  &  IB  in  annex  1  for  details  of  the  flat  rate  Community 
contributions available to broadcasters and producers. 

Broadcasters and manufacturers are working together... 

Here  the  news  is  100% positive:  thirty  nine  broadcasters  in  thirteen  Member 
States are now transmitting in wide-screen.  The Action Plan has supported them 
with funding  equivalent to over 50,000 hours of  16:9 broadcasting from budget 
line  B3-2014,  between  its  start  in  July  1993  and  December  1995.  Thanks to 
these Community resources, the Action Plan has broken the vicious circle and 
enabled wide-screen TV sets to be put on the market.  The wide-screen television 
market has started. Consumers are responding enthusiastically; the installed base 
of  16:9 TV sets has risen to around 500,000.  This report demonstrates the truth 
behind the Action Plan's principle assumption: once there is broadcasting, wide-
screen  TV  sets  will  sell.  One  fact  is  very  striking:  the  close  correlation 
between the volume of broadcasting supported by the Action Plan and sales 
of 16:9 sets.  For visual proof, see Figure 4 on page 16. 

Increased sales of wide-screen sets are the only optimistic feature of an otherwise 
stagnant television market in 1995.  It may not be exaggerating to say that wide-
screen is the strategic product that will provide a future for the TV manufacturing 
industry  in  Europe.  Strong  sales  of  wide-screen  television  full  justify  the 
decision to separate the change in the screen format from the other major change, 
the shift  from  analogue to digital broadcasting.  Manufacturers  will not produce 
integrated digital television receivers for a number of years because of the scale 
of  manufacturing  investments  required.  Digital  TV  will  therefore  begin  as  a 

separate market for decoder boxes attached to existing sets.  As a screen format, 
16:9 is anyway technology-neutral  and this is one of its great advantages for the 
consumer. • 

The Action Plan anyway leaves the choice of technology to the broadcaster. The 
majority of broadcasters have so far chosen to offer wide-screen to their existing 
audiences  using  the  analogue  D2-MAC  or  PAL  Plus  systems,  given  that  the 
transition to digital broadcasting will take up to twenty years to complete.  Other 
broadcasters  are willing  to  build  a new  audience from zero  in  order to  benefit 
from  digital  technologies.  The  Action  Plan  funded  its  first  wide-screen  digital 
service  in  1995.  It  is  expected  that  1996  will  see  further  digital  services 
introduced, with a significant wide-screen element. 

...and there are plenty of European programmes in 16:9 

The  programme  production  part  of  the  Action  Plan  ensures  that  programme 
producers are linked to the  16:9 dynamic of the broadcasters and manufacturers. 
In less than three years, the Action Plan has supported  nearly 20,000 hours of 
16:9  programming  from  budget  line  B3-2013.  It  has  contributed  around  95 
MECU  towards  wide-screen  production  and remastering from budget  line  B3-
2013,  in  order  to  ensure  that  there  is  an  increasing  supply  of  high  quality 
European  programmes  available  to  broadcasters  and  their  audiences.  Almost 
90%  of  all  the  funding  has  been  invested  in  new  programmes.  This  has 
boosted  both  the  quantity  and  the  quality  of  16:9  programmes  available  to 
broadcasters. 

The Action Plan is helping European producers to constitute a catalogue of long-
shelf  life  16:9 programmes whose value will  outlast the life-span  o*f the Action 
Plan itself.  Existing and future  16:9 broadcast services will be able to draw  from 
this catalogue  of  long-life,  "stock" programmes  far into the future.  Confirming 
this trend, major fiction and documentary series in most Member States are now 
planned from the outset  in  16:9.  These two programme  genres are particularly 
suited  to  the  16:9  aesthetic  and  showed  the  strongest  growth  among  different 
genres of programmes funded in 1995.  The Action Plan has therefore positioned 
16:9 as the format for prestige long-shelf life productions. 

By assisting programme producers to migrate to  16:9, the Action Plan is ensuring 
that they participate in the next indispensable  step in the evolution of television 
and that they  have one fixed point in the maelstrom of new technologies  which 
they  must  navigate  in the coming  years.  The  Action  Plan  is  therefore  a  key 
element in the European Union's audiovisual policy and should be supported 
through to its conclusion so that producers in late starting markets enjoy the full 
benefits of participation. 

Milestones in 1995 

1995 saw a number  of important milestones passed half-way  through the Action 
Plan's four year  life. 

The  special  funding  regime  for  late  starting  markets  started,  drawing  on  the 
reserve  of  68  MECU  set  aside  for  them  in  the  Council  Decision.  Broadcasters 
and  producers  in  Greece, Italy, Denmark, Sweden, Ireland  and Austria  were 
thereby enabled  to start wide-screen  transmissions  and programme  making. 
Broadcasters and producers in these Member States benefit from a higher level of 
funding  commensurate with their greater difficulties  in introducing  16:9 - 80% of 
the flat rates. 

Normally  broadcasters  in  these  Member  States  are  unable  to  introduce 
innovations  like  16:9 wide-screen  until years  after  they  have been  launched 
It's  remarkable  how  well  the  Action  Plan  has 
in  the  leading  markets. 
worked in the late starting markets, ensuring their participation very soon  after 
wide-screen  started.  The  decision  to  reserve  68  MECU  for  the  late  starting 
markets was a wise one - and this report shows that it has been justified.  Wide-
screen  broadcasting  has  started  in  these  Member  States  -  but  it's  still  in  its 
infancy.  Achieving  an  impact  on  the market  will  take  several years: the  public 
must  have time to buy  sets. It is therefore  important  to  maintain  support  for 
the  Action  Plan  in  1997,  by  allocating  the  balance  of  funding  permissible 
under  the  Council  Decision.  This  is  also  important  for  the  continuing 
confidence  of the market actors - producers, broadcasters and manufacturers  - in 
the European Union's commitment to the introduction of the  16:9 format. 

During  1995,  the  Action  Plan  committed  almost  all of the  funding  available  for 
the early markets. These include the driver markets for the whole Union, notably 
France  and  Germany,  where  16:9  must  succeed.  The  major  dividend  of  this 
investment was undoubtedly  the successful  mass market  launch of the PAL  Plus 
system  in Germany. PAL Plus is the wide-screen broadcasting  system chosen by 
a majority  of broadcasters so far.  Just 3.2 MECU remained on the Action Plan's 
broadcasting  budget  at  the  end  of  1995  for  the  early  markets  funded  at  50% of 
the flat rates. 

Future prospects for wide-screen and the Action Plan 

The  Commission  considers  that  the  Action  Plan  has  successfully  completed  its 
initial  task  -  breaking  the  chicken  and  egg  syndrome  -  in  almost  all  Member 
States.  This  is  gratifying  but  the  Commission  also  has  concerns:  the  Action 
Plan's  prospects  of  achieving  its  indicative  target of a  critical  mass  of wide-
screen  services  in  Member  States'  markets  by  June  30  1997  are  much  less 
certain.  Achieving  critical  mass  is  important  in  order  to  secure  the 
sustainability  of  the  market.  However,  only  France,  Germany  and  Belgium 
showed signs of achieving a critical mass of services by the end of  1995. 

8 

The problem  is one of resources, rather than any  fundamental  difficulty  with the 
Action Plan itself, or the market, which has welcomed  wide-screen positively, as 
shown in this report. 

Considering  the  future,  it  will  be  important  to  ensure  that  the  benefits  of 
16:9  are  well-integrated  into  the  digital  environment.  The  Commission 
believes  it would  be  desiraole  to  forge  the  closest  possible  link  between  digital 
broadcasting and wide-screen TV for their mutual benefit.  Wide-screerfenhances 
the  consumer  attractiveness  of  digital  TV,  with  other  propositions  apart  from 
"more  channels".  Shortage  of  radio  spectrum  anyway  limits  the  number  of 
channels  of terrestrial  digital  TV.  Wide-screen  also  opens the  way  to the  future 
introduction of digital high definition  television which uses the  16:9 aspect ratio. 
Some  broadcasters  and  programme  producers  would  like  to  offer  their  viewers 
the high impact and realism  of HDTV  on big  screens - the ultimate  evolution  of 
Home Cinema - rather than just more channels. 

In mid-1995, the Action Plan was half-way  through its four year life, which ends 
on  June  30  1997.  The  Commission  felt  that  it  would  be  appropriate  to  assess 
how far  it was likely to achieve the objectives  set out in the Council Decision,  a 
critical  mass  of  services  and  an  increasing  supply  of  wide-screen  programmes. 
As  a first step, the Commission  requested  an  independent  evaluation  of  the 
Action  Plan  by  external  consultants.  This  study  will  consider  progress 
towards the objectives and prospects for the future.  The analysis will help the 
Commission  to  assess  the  desirability  of  a  sequel  to  the  Action  Plan  and  the 
scope of such a measure in the  event that  it should  be justified.  There will  also 
be further  consultations with the market actors and others, notably  in the context 
of a conference to be held later this year. 

Budget lines 

B3-2014 - Broadcasting, managed by DG XIII 

B3-2013 - Programme production and remastering, managed by DG X 

SECTION  A  :  BROADCASTING 

1.  MANAGEMENT  or  TUE  ACTION  PLAN 

1.1  Call  95/1 

funding  for  "late  starting markets" 

This  was  a joint  call'  with  the  programme  production  part  of  the  programme.  The 
most  important  new element which distinguished  this Call  from  preceding  ones  was 
the  availability  of  funding  from  the reserve of  68 MECU  established  in the  Council 
Decision  for  "late  starting  markets".2  Broadcasters  in  Member  States, without  any 
16:9 services, or with  limited  16:9 coverage,  could benefit  from  funding  at a higher 
rate  -  80% of  the  hourly  flat-rates  - rather  than 50%. 

This  reserve  was  intended  by  the  Council  to  ensure  the  Community  dimension  by 
enabling the less developed markets to have access to the Action Plan. Without these 
favourable terms, it was feared that broadcasters in the larger Member States, or those 
with better developed markets, would consume the entire Action Plan. The role of the 
larger  or  better  developed  Member  States  is  important  since  they  are  the  driver 
markets  for  new  consumer  electronics  products. This  reserve  is  significant  because 
it  ensures  that  the  other  Member  States  will  benefit  from  progress  in  the  larger  or 
better  developed  Member  States.  Specifically,  it helps  ensure  that  the Action  Plan's 
"spread and balance" criteria for the equitable community-wide distribution of  funding 
will  be  met  over  the  life  of  the  Plan. 

Response 

Once again broadcasters responded strongly, requesting funding  equivalent to 65,000 
hours  of  broadcasting,  of  which  14,000 hours  were  offered  by  broadcasters  in  80% 
markets.  Total  budgetary  resources were comparable  to  1994, equivalent  to  around 
20,000 hours of broadcasting; note that the 80% funding  possibility  has the effect  of 
reducing  the  number  of  hours  of  broadcasting  that  can  be  funded  since  each  hour 
costs  the  Action  Plan  more. 

The  main  features  of  the  response  were  as  follows: 

-  22  broadcasters  funded  from  earlier  calls  re-applied; 

-  a  further  10 new  entrants  in  50% markets  applied; 

-  10 proposals  were  received  from  new  entrants  in  80% markets. 

O.J. No.  C  26,  1.2.1995,  p.4. 

Art. 2.5, 93/424/EEC,  Council  Decision  of 22  July  1993  on an Action  Plan  for the  Introduction  of  Advanced 
Television  Services  in  Europe.  O.J.  L  196,  5.8.1993,  p.48. 

10 

Results  of  Call  95/1  broadcasting 
Figures  la  and  lb  show  the  final  allocation  of  hours  of  funding  following  Call  95/1, 
with  new  entrants  in  italics.  Broadcasters  in  Ireland  and  Sweden  were  enabled  to 
start  16:9 transmissions  in  those  Member  State.  This  raised  the  number  of  Member 
State  participating  in  the  Action  Plan  to  ten. 

ACriON  PLAN  16:9 BROADCAST SERVICES FINAL ALLOCATION 95/1 
Figure  la:  5 0%  markets 

Code"  Requested 

Allocated 

hours 

hours 

Broadcaster 

1.  FRANCE 

Canal + 

France  total 

2.  GERMANY 

MCM 
France  Super 
Cinécinémas 
Paris  Première 
Arte 

Première 
ARD 
BRF 
ZDF 
3Sat 
MDR 
FAB 
SWF 

Germany  total 

3.  NETHERLANDS 
Netherlands  total 

TV  Plus 

4.  SPAIN 

RTVE 
TV3  Catalan 
RTVA  Canal  Sur 
EUSKAL 
TVG Galicia 

Spain total 

5.  PORTUGAL 
Portugal  total 

TVI 

6.  BELGIUM 

Belgium  total 

7.  UK 

UK  total 

RTBF 
Canal+TVCF  PAL 
BRTN 1 
BRTN 2 

Channel 4 
S4C 

F2 
F5 
F4 
F3 
F6 
F1 

G5 
G1 
G2 
G7 
G8 
G4 
G3 
G6 

N1 

E3 
E5 
E2 
E1 
E4 

P1 

B4 
B3 
B1 
B2 

U1 
U2 

3.376 
3.984 
6.022 
2.912 
1.460 
251 
18.005 

900 
500 
300 
800 
960 
400 
5.150 
100 
9.110 

2.025 
2.025 

575 
427 
695 
200 
240 
2.137 

400 
400 

700 
2.880 
415 
260 
4.255 

100 
1.014 
1.114 

1.400 
1.200 
2.700 
900 
400 
250 
6.850 

700 
500 
300 
800 
960 
400 
400 
100 
4.160 

1.000 
1.000 

250 
300 
200 
200 
250 
1.200 

200 
200 

700 
950 
415 
260 
2.325 

400 
400 
800 

Total zone 50% 

Total zone  50% 

37.046 

16.535 

Figure  1 b:  80% markets 

Code  Requested 

hours 

Allocated 
hours 

8.  GREECE 

Greece  total 

9.  SWEDEN 
Sweden total 

10.  IRELAND 
Ireland total 

Broadcaster 
EPT  Hellenic TV 
ERT-3 
TVS 

"ŒRT 
GR2 
GR4 

TV 1000 

S1 

RTE 

IR1 

~ " 2W 
250 
3.276 
4.876 

"200" 
250 
250 
700 

5.104 
5.104 

1.300 
1.300 

263 
263 

250 
250 

Total zone 80% 

Total zone 80% 

13.062 

2.250 

Grand Total=32  PROJECTS  (80%+50%) 

50.108 

18.785 

The  main  elements  underlying  this  allocation  were  as  follows: 

-  The Commission  and the Member State Committee agreed a funding  period of  one 
year  from  1 January  1996. 

-  On  the  recommendation  of  the  independent,  external  technical  evaluators,  four 
projects  received  were  not  funded  because  they  did  not  meet  the  project  quality 
criteria  set  out  in  the  annex  of the  Council  Decision. 

-  The 22 broadcasters  funded  under earlier  calls were awarded  the same as they  had 
received  in  1994  on  a pro  rota basis. 

-  The  ten  new  entrants  in  50%  markets  received  the  number  of  hours  they  had 
requested  for  the  funding  period 

-  The  ten  new  entrants  in  80% markets  also received  the number  of  hours  they  had 
requested  for  the  funding  period 

The  Commission  and  the  Committee  agreed  that  it  was  important  to  maintain 
continuity  of  funding  in  the  50%  "driver  markets", particularly  the  need  to  support 
the mass  market  launch  of the  PAL-Plus  wide-screen TV  system  in Germany  at the 
Berlin  IFA show in August. This would offer  the best possibility  for the  16:9 market 
to become established  in those countries, given that  16:9 would not be sustainable  in 
80%  countries  without  success  in  the  "driver  markets".  Relatively  low  demand  for 
broadcast  hours  in  the  80%  markets  reflected  the  difficulty  broadcasters  in  those 
countries  faced  in launching  16:9. A simple division of  the available budget  between 
50%o and  80% would  not  therefore  have  reflected  market  development. 

12 

1.2.  Call 95/3 
After  18 July, a further 4 MECU became available.3 A further Call was therefore 
organised  in  order  to  allocate  these  funds4.  The  Commission  felt  that  the 
additional  call  could  provide  an  opportunity  to  increase  the  participation  of 
broadcasters in 80% markets.  Several  projects that had not been funded  in Call 
95/1  were  resubmitted  with  improvements,'  following  discussions  between 
broadcasters and the Commisssion.  The Austrian and Danish public broadcasters 
submitted proposals for the first time. 

Response 

-  20  broadcasters  applied  including  6  that  had  already  been  funded  following 
Call 95/1. 

Results of Call 95/3 broadcasting 

Figure  2  shows  the  final  allocation  of  funding  pursuant  to  Call  95/3.  16:9 
broadcasting 
in  Austria  and  Denmark  could  start,  following  successful 
applications  by broadcasters  in those  countries. Note  that Danmarks Radio  will 
transmit  in  16:9 using  the digital  satellite  norm specified  by  the  Digital  Video 
Broadcasting Group, the first digital wide-screen service in Europe. 

Figure 2 

ACTION PLAN  16:9 BROADCAST SERVICES FINAL ALLOCATION  95/3 

Code 

Requested 
hours 

Allocated 
hours 

Veronica 
1. Netherlands 
2.United  Kingdom  Granada 
Total 50% 

3. Italy 

4.Austria 
5. Denmark 
Total 80 % 

Teienuovo 
Synthesia 
Videolina 
Orf 
Danmarks Radio 

N1 
R1 

11 
12 
13 
AT1 
D1 

Grand total 
New entrants  in italics 

2500 
150 
2650 

1760 
1160 
1850 
360 
430 
5560 

400 
150 
550 

300 
200 
200 
360 
400 
1460 

8210 

2010 

The main consideration behind the distribution is as follows: 

- broadcasters who had already been funded under Call 95/1 received no funding 
from Call 95/3. 

3 

The European  Parliament had blocked this sum pending receipt of the  1994 Annual  Report. 

4  O.J. No C 212,  17.8.1995, p.28. 

13 

Since  the  4  MECU  was  part  of  the  same  1995  budget,  it  seemed  reasonable  to 
give  priority  to those  who  had  not  been  funded  under  Call  95/1, especially  new 
entrants. 

1.3.  Evaluation  methodology 

Note that the evaluation procedure  for  both calls was unchanged  from  1994. An 
independent  external  consultancy  assisted  with  the  technical  evaluation  of 
projects.  Their  tasks  were  first  to  establish  elegibility  of  proposals  against  the 
"project  quality  criteria"  set  out  in  the  Council  Decision;  second  to  provide  a 
ranking of the projects with particular emphasis on the likely attractiveness of the 
services  to  audiences;  third,  to  identify  omissions  and  weaknesses  in  the 
proposals so that the Commission could address these in contractual negotiations. 

The  technical  evaluations  supplied  important  inputs  into  the  Commission 
proposal  for  both calls. However, the  "spread  and balance"  criteria were  applied 
by 
the 
Committee. The Technical Evaluators' Summary  Reports were made available to 
the Member State Committee. 

the  Commission  exclusively  before  formulating 

its  proposal 

to 

1.4  Building on the excellent foundation set down in earlier years 

Two  maps  illustrate  graphically  how Calls 95/1  and 95/3 have successfully  built 
on  earlier  activity.  Figure  3A  was  published  in  last  year's  annual  report3;  it 
shows  that  22  broadcasters  in  eight  Member  States  were  transmitting  in  16:9 
format.  Figure  3B is an updated  version  which  includes  broadcasters  funded  in 
1995.  A  total  of  39 broadcasters  are now  transmitting  16:9 services  in  thirteen 
Member States. 

5 

Figure 2, P. 12, COM (95) 263 final/2, Brussels 22.06.1995. 

Action Plan  Broadcasting 
30-12-94 

i 

I  National 

O  Regional 

O  Pan European 

Granada 

Channel 4 

France 
Supervision 

Canal+ 

Cine Cinema 

MCM 

RTVE 

TVI 

RTVA 

Figure 3A 

Premiere 

ZDF 

•  3-Sat 

"~  MDR 

l  BRF 

ARD 

Action Plan Broadcasting 30-12-95 

Veronica 

National 

Regional 

( 

)  Pan European 

Channel 4 

France 
Supervision 

Canal+ 

Cine Cinema 

MCM 

Paris 
Première 

RTVE 

TVI 

RTVA 

Danmarks 
Radio 

TV1000 

FAB 

Premiere 

X 
^ 

ERT3 

TVS 

Figure 3B 

Videolina 

Syntesia 

Teienuovo 

DTP-Tawn - DG  XIII 

ERT 

2. 

IMPACT 

16 

2.1.  How 16:9 broadcasting triggers sales of 16:9 TV sets 

The  initial  challenge  was  to  break  the  "chicken  and  egg"  syndrome  which  had 
prevented  16:9 from reaching the market originally: broadcasters would not transmit 
without receivers being on the market and manufacturers would not commit to mass 
production  without  broadcasting.  The  preceding  section  has  described  the 
enthusiastic  uptake  of  16:9  by  broadcasters  in  thirteen  Member  States  so  this 
difficulty  is largely solved, although it would be desirable to have more services in 
certain markets. 

Figure 4 : Comparative Evolution from 1992 -  1996 between Sales of TV 16:9 and 
the number of hours for Programmes Broadcast in 16:9 in Europe. 

Comparative Evolution from 1992 -1996 between Sales of TV 16/9 and 
the no. of hours for Programmes Broadcast in 16/9 in Europe 

250,0  j 

200,0 -

2 

150,0 4-

|  100,0  I 
to 
O 
•a 
.s 
n 

50,0 

C/3 

-r 30000 

[2D Sales 

25000 

-•- Hours 

4- 20000 

4-15000  S 

4- 10000 -g 
s 
o 

-  5000 

& 

t-ea-f. 

f 
o 
s  % 
fa 

Source : Thomson Multimedia 

Figure 4 shows the comparative evolution from 1992-96 of TV sales and hours of 
broadcasting  supported  by  the  Action  Plan.  The  correlation  between  cumulative 
sales of wide-screen TV sets and broadcasting is very close, particularly  in France 
and  Germany  where  16:9 first  started.  This  demonstrates  that  the Action  Plan  is 
having the intended effect.  Germany and France are motor markets for the whole of 
Europe and started earlier than others.  They matured quickly, rapidly developing a 
range of services to stimulate consumer demand.  The Action Plan seems to be well 
on  the  way  towards  meeting  its  indicative  target  in  those  markets,  together  with 
Belgium,  of  catalysing  a  critical  mass  of  services.  Achieving  critical  mass  is 
important  if  the  market  is  to  become  self-sustaining,  as  foreseen  in  the  Council 
Decision. 

17 

The  progress  of  the  German  market  largely  justifies  the  considerable  resources 
committed  in  1994 and  1995.  German  sales of wide-screen  sets tripled to 75,000 
units  and  this  growth  is  directly  attributable  to  the  Action  Plan.  German 
broadcasters made a heavy collective commitment to  16:9 at the Berlin IFA show, 
with  extensive  transmissions  from  the  IFA  itself,  underwritten  by  Action  Plan 
funding.  Manufacturers  showed an extensive range of receivers at all price levels 
and  screen  sizes,  demonstrating  their  commitment  to  the  product.-. German 
consumers had ten different  brands of receiver to choose from following the IFA. 

The  1994 annual report argued that favourable  development of the German market 
would be a precondition for the success of the 16:9 format in Europe.6 Two reasons 
were given: first because of the importance of the German market in general; and 
more specifically,  because the successful  German launch of PAL-Plus would be a 
prerequisite  for  16:9  to  succeed  in  most  other  countries,  since  PAL-Plus  is  the 
system selected by the majority of Action Plan broadcasters for 16:9 transmission. 

Other  markets  are  either  far  from  achieving  a  critical  mass  of  services  or  started 
later; the lag between the allocation of funding, broadcasting of the subsidised hours 
and  television  sales  means  that  market  impact  will  come  in  1996  and  1997, 
particularly  in the late starting markets funded  at 80%.  Annex 2 contains graphics 
comparable to figure 4 for ten Member States individually. 

Note that the comparatively low sales of 16:9 receivers in the UK market reflect the 
BBC's decision to link wide-screen to its project for digital terrestrial broadcasting. 
Transmissions  cannot  start  before  the  end  of  1997,  until  the  digital  terrestrial 
transmission system becomes operational, after the expiry of the Action Plan. 

2.2.  The  strategic  importance  of  16:9  TV  sets  to  the  consumer  electronics 

industry 

The following  section demonstrates the importance of wide-screen for the consumer 
electronics industry. 

6  COM (95) 263 final  16.06.95 p27, section  3.3 

18 

Figure 5 below shows unit sales of all colour TV receivers  in the EU. The volume of sales was at best 
stagnant and actually contracting in most markets. 

Figure 5 

Total Colour Television set sales 1994 and 1995 7 

(Thousands 
of units) 

Austria 

Benelux 

Denmark 

Finland 

France 

Germany 

Greece 

Italy 

Portugal 

Spain 

Sweden 

U.K. 

EU15 

1995 

492,0 

1 350,0 

320,0 

1994 

524,0 

1 395,0 

316,0 

" 

' 

3 575,0 

5 450,0 

400,0 

3 010,0 

540,0 

1860,0 

430,0 

3 545,0 

20 972,0 

3 650,0 

5 529,0 

400,0 

3 012,0 

510,0 

1 836,0 

460,0 

3  563,0 

21  195,0 

Trend 
(in  %) 

-6,1V. 

-3,2% 

1,3% 

-2,1% 

-1,4% 

0,0% 

- 0 , 1% 

5,9% 

1,3% 

-6,5% 

-0,5% 

-1,1% 

Source: EACEM 

One  important  reason  for  stagnation  is that there  has  been  no  strong  reason  for  consumers  to  replace 
their  television  sets.  The  products  are  very  reliable  and  have  a  long  life  and  there  have  been  no 
fundamental  changes  to  the  appearance  of  TV  pictures  received  at  home  since  the  introduction  of 
colour thirty years ago.  Even the introduction of digital TV could just mean more channels of 4:3 TV, 
of  no  better  quality  than  today's  pictures  if  broadcasters  prefer  to  have  more  channels  rather  than 
changing the presentation, by introducing wide-screen and/or introducing  studio quality pictures to the 
home. 

New products and innovation are the life-blood  of consumer electronics. They restore value in the eyes 
of  the  consumer  and  refresh  manufacturers'  profit  margins  since  consumers  know  that  the  cost  of 
consumer electronics products falls over time.  Compared with the effect  that compact disc has had on 
the  music  business, the  inertia of the TV receiver  is very  marked.  16:9  is the  biggest  change to  the 
television  receiver  since  colour  and  is just  the  kind  of  incentive  that  the  consumer  needs  to  restore 
interest  in a product that  is still  largely  manufactured  in Europe.  It is contributing to the  stabilisation 
of employment in an industry where the number of jobs has declined by 40% since  1982.8 

Increased  sales  of  16:9  receivers  were  the  only  positive  feature  of  the  television  market  last  year. 
Figure  6 below shows  1995 sales of  16:9 TV  sets  in Europe, with  a  64% increase  in sales across  the 
EU  15 compared  with  1994.  The  275% increase  in  German  sales  -  to  a  very  respectable  volume  of 
75,000 units - is particularly  impressive, as is progress in neighbouring  Benelux.  Despite the strikes at 
the  end  of  last  year,  French  sales  grew  by  55% in  the  final  four  months  of  1995  compared  with  the 
same period in  1994, according to SIMAVELEC.9 

7 

8 

9 

Figures for  1995 are provisional 

Source: EACEM. Based on industry statistics for  1994. 

Summary of the press conference  given  by Mr Serge Amiard, the President of SIMAVELEC on  13.02.96, P.4 

19 

Figure 6 

Sales of 16:9 wide-screen TV sets 1994 and  1995 10 

(Thousands 
of units) 

1995 

1994 

Trend 
(in  %) 

Austria 

Benelux 

Denmark 

Finland 

France 

Germany 

Greece 

Italy 

Portugal 

Spain 

Sweden 

U.K. 

EU15 

4,0 

0,7 

30,0 

10,0 

85,0 

75,0 

10,0 

7,0 

85,0 

20,0 

6,3 

3.0 

1,0 

1.0 

4,5 

4,0 

0,5 

1.0 

4,2 

3.0 

220.5 

134,7 

471,4V. 

200,0% 

42,9% 

0,0% 

275,0% 

110,0% 

0,0% 

12,5% 

•50,0% 

40,0 

63,7% 

Source: EACEM 

3. 

PROSPECTS  FOR 1996  AND  1997 

Following  the  two  1995  calls,  the  Action  Plan  is  supporting  broadcasting  in  thirteen  Member 
States.  Some  16:9  services  from  neighbouring  countries  are  available  in  Luxemburg;  only 
Finland  lacks  any  16:9 broadcasting.  After  only  two  years  of  Action  Plan  operations,  the  speed 
with  which  the 39 broadcasters  have  launched  16:9 services  is a testimonial  to the Action  Plan's 
success in accelerating the development of the services market. 

In  particular,  late  starting  markets  have  made  rapid  progress,  with  a  strong  demand  for 
broadcasting  in the first  year of  80% funding.  Only  3 MECU  of broadcast  funding  remained  for 
future  allocation in the early starting markets following  the  1995 calls; the remaining Action Plan 
funding  is reserved  for  the  late  starting  markets.  The  1996 broadcasting  budget was reduced  by 
50%.  It is therefore  of critical  importance  that adequate budget  is made available in  1997 so that 
the  late  starting  markets  can  benefit  fully  from  the  favourable  terms  set  out  in  the  Council 
Decision. 

3.1.  The issue of critical  mass 

The Council  Decision  sets the indicative target of a critical mass of  16:9 broadcast services as an 
indicative target for the broadcasting  side of the Action Plan. The  Council took the view that the 
accelerated  development  of  the  services  market  would  be  crucial  in  order  to  meet  the  overall 
objective of contributing to the market penetration of  16:9 receiver equipment. This approach was 
fully  supported by the European  Parliament. 

However, the extent to which a critical mass of services has been reached is much harder to assess 
than  the  acceleration  of  the  services  market.  Broadcasting  markets  are  fragmented  by  language 
and tradition  in Europe, even if national  frontiers  are a diminishing barrier. There may need to be 
a  critical  mass  of  services  in  each  Member  State  for  the  Action  Plan  to  achieve  its  indicative 
target. 

10  Figures  for  1995 are  provisional 

20 

By this criterion, the Action Plan has a difficult task to achieve before its end on June 30th 1997. 
France  and  Germany  are  the  most  likely  candidates  to  achieve  critical  mass,  possibly  also 
Belgium. Other markets are still in "break out" mode, with one service, like Portugal or Sweden. 
The majority of Action Plan services were still less'than one year old in 1995. 

In order to  help assess the critical  mass  issue,  the  Commission  has engaged  a consultancy  firm 
which  will  report  in  mid-1996.  This  is  expected  to  be  a  major  input  into  the  Commission's 
reflections  on  whether  there  should  be  an  extension  of  the  Action  Plan  or  what  other  policy 
measures should replace it in order to consolidate the success of 16:9 in Europe. 

*  *  * 

21 

APPENDIX 

Backgrounder  on wide-screen  16:9 
- Frequently  Asked  Questions  -

Why  wide-screen? 

The wide-screen screen format in the proportions 16 to 9 (16:9) is the only globally agreed parameter for 
the future of television.  It's more ergonomie than the current  1930s movie format used by TV, the squarer 
4:3 format.  Wide-screen brings TV into line with cinema which has used wide-screen since the 1950s.  It 
works with both analogue and digital pictures and is therefore "future proof; it protects consumer 
investments in the display, the most expensive part of the TV.  The successful introduction of 16:9 is a 
requirement for the future introduction of digital high definition television.  Wide-screen is simultaneously 
an important feature of the deepening relationship between film and TV - it brings the movie aesthetic into 
TV - and an important element which the audiovisual industries contribute to the broader convergence of 
audiovisual, telecommunications and computing. 

The  problem 

Changing the screen format is much harder than just plugging another box for satellite or digital TV into an 
ordinary TV.  16:9 is a fundamental alteration to the core of the system; the architecture of the TV receiver 
itself changes.  This requires real co-ordination between manufacturers and broadcasters if consumers are 
going to be offered  wide-screen in a synchronised manner. And wide-screen TV could not be introduced 
into Europe because of the "chicken & egg" problem.  Broadcasters would not start to transmit wide-screen 
until wide-screen TV sets were on the market; manufacturers refused to launch them until transmissions 
had begun.  The market was blocked, even though all market research evidence showed that consumer 
interest in wide-screen  16:9 was considerable. 

Why  invest  public  money? 

What economists call "Market Failure" means wide-screen would not otherwise reach the public. 
Consumer electronics manufacturing now requires European scale at minimum.  Broadcasting still has a 
national  structure for regulatory and linguistic reasons.  The introduction of colour in the sixties was the 
last major innovation - when both manufacturing and broadcasting had a national structure - and this was 
successful: colour TVs and services appeared at the same time.  The current asymmetry between the 
structures of the two industries causes practical difficulties  because the "market forces" and investment 
timing requirements are different.  In any case, a laisser faire approach based exclusively on "market 
forces" is inappropriate in the broadcasting sector, because public broadcasters  still account for such 
a high percentage of  audience ratings. 

22 

The  need 

Public broadcasters have long pioneered the introduction of new technologies like colour, stereo and 
teletext. However, they all have financial difficulties which have made it very hard for them to undertake 
the significant investments necessary to transmit  16:9, even though they all know 16:9 is the future of TV. 
The Action Plan has so far helped  17 public broadcasting channels to launch wide-screen services, helping 
them to sustain their traditional role as pioneers into the 1990s. Commercial broadcasters - funded by 
advertising or pay TV subscription revenues -  have a short term perspective: wide-screen hits their 
financial  "bottom line" and pay-back on the investment takes a long time. Action Plan funding combats 
short termism by weakening the accountants' case against 16:9. 

The solution 

The Action Plan breaks the "chicken and egg" problem by offering  an hourly community contribution 
towards broadcasters' extra costs through budget line B3-2014 - and those of producers through 
another budget line B3-2013. Note that funding programming in wide-screen is not enough on its own: the 
programmes must be transmitted in 16:9 to trigger consumer interest in the new format  The Action Plan's 
tough quality control criteria stress the need for attractive wide-screen services capable of winning high 
audiences; in this way the impact of the Community funding is maximised. 

Î3 

SECTION  B  :  PRODUCTION 

INTRODUCTION 

The  Action  Plan,  a Community  instrument  for  the  audiovisual  sector 

The aim of the Action  Plan, a four-year  Community  instrument  (July  1993- July  1997), 
is to act as a catalyst  for  the development  of the market  in advanced  television-services. 
The  encouragement  for  the  development  of  a  European  dimension  on  this  market  will 
spur  the  television  audiovisual  industry  to  modernize  and  prepare  for  the  future  in  a 
coherent,  clear  and  synchronized  manner:  when  tlie time  comes  it  must  be  ready  for  a 
fully  digital  content. 

Advanced  television  services  are  now  broadcasting  in  tlie  16:9  fonnat,  on  which  a 
consensus  has been reached  in Europe. The  16:9  format  has two major  advantages. The 
first  is technical:  it  is neutral  in  relation  to the various  transmission  standards  and  thus 
encourages  the  transition  from  the  analog  world  to  the  digital  world.  The  second  is 
commercial  and  aesthetic: this panoramic  format  gives higher  image  quality  and  brings 
television  in  line  with  the  cinema. 

The structural  effect  sought by the Action Plan is to develop a critical mass of advanced 
television  services  in order to make them  generally  available at European  level. For that 
purpose,  the  strategy  adopted  by  the  Action  Plan  takes  into  account  the  interests  of  all 
those  involved  in  the  audiovisual  chain.  As  the  main  actors  in  broadcasting  are  the 
programme  distributors  and  producers,  the  Action  Plan  deploys  its  efforts  in  two 
directions  by  simultaneously  stimulating  supply  and  demand  for  16:9 programmes  in  a 
coordinated  and  decisive  manner at Community  level. Thus the  16:9 Action  Plan  offers 
European  broadcasters  and producers  supplementary  funds  to cover the additional  costs 
generated  by the  16:9. Considerable  investment  in terms of both  finance  and  equipment 
is  needed  to  broadcast  and  produce  16:9  material. 

The  16:9  market 

In  addition  to  broadcasting  services,  see  section  A,  part  2,  p.  16  -the  16:9  market 
includes general  public and professional  equipment  linked to the use of this format.  The 
launching  of  16:9  broadcasting  services  at  European  level  encourages  investment  and 
drives  modernization,  which  is  necessary  for  the  competitiveness  of  the  audiovisual 
industry,  the  professional  equipment  of  the  broadcasters,  and  of  production,  rental  and 
equipment  firms.  The Action  Plan has the effect  of streamlining  the industry  in general. 

The  Action  Plan,  an  integral  part  of  the  Community  audiovisual  policy 

By participating  in the emergence of a critical  mass of  16:9 services in conjunction  with 
the economic  actors, the European programmes  industry can be clearly oriented  towards 
the future.  Producing in  16:9 guarantees technical quality. The systematic encouragement 
of  European  production  to  use  production  equipment  compatible  with  the  16:9  format 
is a strategic commitment  at  European  level to the durability  of programme  catalogues. 

24 

Programme  catalogues  are  the  basis  of  any  strategy.  They  are  the  source  of  the 
industry's  revenue. They  are a business  asset.  Catalogues consist of material with a 
long  shelf-life  which  can  be rebroadcast  and  exploited  on markets other than their 
own.  The  Action  Plan,  which  is  geared  to  the  programmes  industry,  is  thus  an 
integral  part  of  the  Union's  audiovisual  policy.  Its  purposes  are  to  strengthen  the 
structural  capacity  of  the  audiovisual  programmes  industry  and  to  develop  its 
European dimension. 

The  methodology  of  die  Action  Plan  is  based  on  these  considerations.  The 
programmes  section of the Action Plan joins with the producers themselves and the 
economic  actors  who  invest  in the  16:9  in cofmancing  the additional cost either of 
producing  new  16:9  programmes  or  of  remastering  material  available  in  other 
formats  to  make  them  compatible  with  the  16:9 format.  50% or  80% of  the 
additional cost is cofinanced on the basis of flat-rate hourly scales. 

Scope of the Action Plan 

Calls for proposals1 ' invite European producers to apply for aid for new productions 
and/or remastering. Eligibility criteria are as follows: 

producers  must  be  established  in  one  of  the  Member  States of the European 
Union; 

producers  must  show  that  a  16:9  broadcaster  established  in  the  European 
Union undertakes to broadcast the programme covered by the application; 

producers  must  certify  that  co-financing  of  the  additional  costs  comes from 
economic sources other than the Action Plan. 

If the aggregate aid applied  for  exceeds budgetary availabilities, priority criteria are 
applied  to  select  the  production  projects.  No  place  is  given  to  qualitative 
assessments of the programmes' contents and priority is given to: 

long-life ("stock") programmes; 

projects submitted by independent producers; 

projects  from  Member  States  with  small  production  capacity  or  with  a 
restricted  language area; 

projects  for  which the additional  sources of financing come exclusively from 
economic operators. 

Where  existing  material  is  to  be  remastered,  priority  goes  to  programmes  of 
European origin. 

H 

A  first  combined  services/programmes  call  will  be  followed  by  two  calls  for  the 
programmes section during the following  twelve months - Annex 5 to the Council  Decision. 

CHAPTER 1 -  16:9 ACTION PLAN 1993-95 

25 

This  chapter  outlines  activities  pursued  under  the  Action  Plan  in  1995  and  the 
development  of  the  Community  programme;  this  is  a  particularly  useful  analysis 
after two and a half years' operation. 

1.1.  Overall results expressed in ecu and hours: 

Year 

Call 

Million ecu 

1993 

1/93 

11.6 

1994 

1/94 

19.4 

1994 

2/94 

33 

1995 

1/95 

18.1 

1995 

2/95 

12.5 

Hours 

2 936 

4 555 

5 648 

4 099 

2 551 

Five calls  for  proposals  have  been  organized  since  the  Action  Plan  was  drawn  up: 
one in  1993, two in  1994 and two in  1995. The budget for each call was different.  At 
first there was an upward  trend  until the second  call  in  1994 and  then a downward 
trend until the second call in 1995. 

In  all,  ECU 94.6 million  was  allocated  to  European  producers  between  July  1993 
and 31 December  1995 to produce or remaster programmes in the  16:9 format. 

The ECU 94.6 million cofinanced  19 789 hours of programmes in 16:9: 

ECU 84.4 million cofinanced  12 367 hours of new programmes in 16:9; and 

ECU  10.2 million cofinanced  7 422 hours of remastering. 

1.2.  Proposals  (production  and  remastering  projects)  received  under  the 

Action Plan 

Stable number of proposals  received 

The  number  of  proposals  received  was  relatively  constant  at  1  000  or  so  for  each 
call. The  smallest  number  of  applications  received  (732)  after  the  1/94  call  can  be 
explained  by  the  fact  that  the  first  call  under  the  Action  Plan  (1/93)  had  benefited 
from  the  launch  of  the  programme  and  most  of  the  production  projects  in 
preparation  were  attracted  en  masse.  It  was  necessary  to  wait  for  call 2/94  for 
producers to submit numerous new applications for production aid. 

|  Call 

Proposals 
received 

1/93 

944 

1/94 

732 

2/94 

1.113 

1/95 

970 

2/95 

1.116 

26 

Increase in the number of programme hours submitted under the Action Plan 

Since  the  start  of  the  implementation  of  the  Action  Plan,  the  programme  hours 
corresponding  to aid applications received under the Action Plan rose  significantly, 
as is shown by the following table: 

Call 

1/93 

Hours received 

7 500 

1/94 

8 000 

2/94 

1/95 

2/95 

10 356 

16 392 

10J35 

The tenders submitted after each of the first two calls (1993 and early  1994) totalled 
8 000 programme hours. At the end of  1994, the total was  10 300 hours. A new peak 
was passed early 1995 when applications from producers totalled  16 400 programme 
hours. For  1995 as a whole,  demand reached 27 127 hours as against  18 356 hours 
in 1994. 

Increase in the number of tenderers using the Action Plan 

Over  the  first  two  years  of  its  implementation,  the  total  number  of  tenderers 
increased threefold. At the end of  1994, following three calls, this total stabilized at 
an average of 200 producers per call. 

Call 

1/93 

1/94 

2/94 

1/95 

2/95 

Number of 

producers 

80 

148 

243 

184 

190 

1.3  The  professionals  involved 

27 

The  two  main  categories  of  producers  who  benefited  from  tlie Action  Plan  are  the 
independent  producers  and  broadcasters.  The following  table  shows the  breakdown 
of budgetary funds  between them and their respective share in the production of new 
16:9 programmes. 

Year 

Call 

ECU 

Broadcasters 

Producers 

HOURS 

Broadcasters 

Producers 

1993 

1/93 

56% 

44% 

63% 

37% 

• 

1994 

1995 

1/94 

2/94 

1/95 

2/95 

62% 

38% 

78% 

22% 

50% 

50% 

55% 

45% 

55% 

45% 

73% 

27% 

56% 

44% 

73% 

27% 

1.3,1  General analysis 

Since  the  start  of  the  implementation  of  the  programme,  Community  funds 
have been shared out evenly between independent broadcasters and producers: 
on  average,  between  1993  and  1995,  55% of  the  funds  were  allocated  to 
broadcasters  and  45% to  independent  producers,  while  broadcasters  account 
for  68% of the hours and independent  producers 32%. In these percentages, it 
must  be noted  that  broadcasters'  hours  consist  mainly  of remasterings,  studio 
productions and sports programmes,  for which the hourly scales on which the 
Community  grant  is  calculated  are  much  lower  than  for  other  categories  of 
programmes.  Independent  producers,  for  the  most  part,  make 
long-life 
programmes for which the scale is much higher. 

The above table and  graph  show the development  of the various stages of the 
implementation of the Action Plan, which are as follows: 

1993-1994 - Launch of the first  16:9 services cofinanced at the rate of50%  of 
the additional costs: 

At the time of the first call  for  proposals (1/93), broadcasters received  56% of 
the  budgetary  funds  and  produced  63%  programme  hours.  The  pioneer 
markets were ready to start up, and this first call coincided with the launch of 
the  first  16:9  services  for  which  broadcasters  urgently  needed  16:9 
programmes.  Although  there  were  only  a  few  of  them (60),  independent 
producers  submitted  programmes  under  the  Action  Plan  that  were  ambitious 
in  terms  of  hours,  a  fact  which  explains  how  they  provided  37%  of 
programme hours. 

28 

Call  1/94  saw  a  strengthening  in  the  new  16:9  services.  16:9  broadcasters 
intensified  their  efforts  to  reinforce  the  identity  of  their  channel  and  thus 
needed  a very  large  quantity  of programmes  in order to immediately  fill  the 
programming  schedules.  That  call  was  dominated  by  broadcasters,  who 
produced 78% of programme hours in order to achieve a breakthrough of their 
16:9  services.  The  budget  rose  to 67%  (ECU  19.4 million  compared  with 
ECU 11.6 million  for  the  first  call)  and  thus  made  it  possible  for  68 new 
independent producers to enter tlie 16:9 market. 

End  1994  -  Arrival  of  a  large  number  of  independent producers  on  the 
European 16:9 market 

Call 2/94, which was allocated the largest budget of all the calls for proposals, 
marked  a  turning-point  in  the  implementation  of  the  Action  Plan.  On  that 
occasion independent producers arrived in number on the  16:9 market. A total 
of 220 producers (95 more than for the previous call) made 45% programme 
hours,  the  highest  percentage  of  all  the  calls.  Broadcasters  and  independent 
producers  shared budgetary  funds  evenly.  That call was the first to prove by 
its results that there was a genuine pioneer market for European 16:9 services. 

1995 - Launch of 16:9 services  on late developing markets cofinanced at the 
rate of 80% of the additional costs 

Because  of  the  variable  rate  of  economic  and technological  development  in 
broadcasting  in the various Member  States and the absence of projects from 
some of them, the Action Plan was unable to cover the whole of Europe in a 
homogeneous manner from the outset. The  16:9 market must in time cover all 
the European Union,  including  markets with smaller potential either because 
of their reduced language area or the structural weakness of their audiovisual 
industry. The Council Decision consequently  made provision for a budgetary 
reserve,  available  on  1  January 1995,  for  "markets not  being  fully  served  in 
the  early  stages  of  the  implementation  of  the  action  plan".12  The  rate  of 
assistance for these markets was higher than for pioneer markets: Community 
funds covered a maximum of  80% of the additional costs for production and 
remastering. 

Call  1/95  was the first call for proposals to apply the 80% rule. The countries 
which  benefited  from  it  were,  in  principle  Italy,  Denmark,  Greece,  Ireland, 
Luxembourg,  Sweden,  Austria  and  Finland.  Call  1/95  enabled  producers  on 
these markets to launch the 16:9 format. 

On  the  whole,  funds  allocated  to  this  call  were  evenly  distributed  between 
broadcasters  and  producers.  Broadcasters  produced  73% programme  hours. 
The  number  of  16:9  broadcasters  increased from 20  to 42  during  1995. The 
launch of the services of a second wave of broadcasters was a decisive  factor 
in the high programme requirements of broadcasters. The very strong demand 
for  hours  received  under this call  (16 392 hours, or 60% up on the  previous 

Twelfth  recital. 

29 

call) confirmed the very high programme requirements of the new services on 
the new markets. 

In  the  case  of  call 2/95,  56%  Community  support  was  allocated  to 
broadcasters. The distribution of hours was similar to that of the previous call: 
73%  new  programme  hours  were  produced  by  broadcasters  and  27%  by 
independent producers. 

13.2 

Independent producers 

_ 

The  variety  of  producers  reflects  that  of  the  European  audiovisual  world. 
Some  big  names  in  the  production  world  appeared  regularly,  as  did  some 
younger producers who are interested in the  16:9 format.  Since the entry into 
force  of  the  Action  Plan,  a  nucleus  of  pioneer  producers  producing  16:9 
programmes has been formed. Over a quarter of the hours of new productions 
relating to the  1/95  call  came  from producers who  responded to all the calls 
since the beginning. The percentage of producers who are loyal to the Action 
Plan  is  constantly  increasing:  11% for  the  1/94  call,  15% for  the  2/94  call. 
These  producers  who  are resolutely  committed  to  the  16:9 format  primarily 
produce documentaries and fiction programmes. 

In its action to support the durability of European audiovisual  catalogues, the 
Action Plan is an efficient  tool of the Union's audiovisual policy. Audiovisual 
catalogues  are the  business  asset  of  the European  programmes  industry, and 
particularly of the independent producers who are the spearhead of European 
audiovisual  creation.  Although  European  producers  lack financing capacity, 
works produced must have a, long life  in order to ensure income and develop 
their activities. 

While the  16:9 format is a decisive substantive argument for the durability of 
the  audiovisual  heritage,  it  is  also  an  essential  formal  argument  for 
audiovisual creators and professionals generally.  16:9 format aligns television 
on  the  cinema.  16:9 centring  and  image  quality  are  a  decisive  aesthetic 
contribution  to  fiction  programmes,  documentaries  and  other  cultural 
programmes  which  illustrate  the  European  heritage  (painting,  architecture, 
music,  dance,  history).  Europe's  cultural  heritage  which  is  enhanced  by  the 
audiovisual  media  is  thus  enriched  and  the  European  Union's  self-imposed 
task  of  safeguarding  the  cultural  riches  and  diversity  which  are  Europe's 
hallmark is being carried out. 

1.3.3 

Broadcasters 

An average  of thirty or so  broadcasters took  part in the programmes section. 
They  responded  to  calls  under  the  Action  Plan  in  their  dual  capacity  as 
broadcaster and producer. As they  set up their own  16:9 services, they enjoy 
support  from  the  Action  Plan  not  only  through  the  production  aid  which  it 
provides  but  also  through  the  clear  political  signal  of  commitment  to  a 
European  future  which  the  Plan's  very  existence  sends  to  the  industry  as a 
whole. 

30 

Little by little broadcasters are fitting  their studios out in such a way that they 
can produce a range of in-house material that accounts for a significant  part of 
their  programmes  and  audience.  Moreover,  the  identity  of  the  channel  is 
closely  linked to this type of production. 

1.3.4 

The 16:9 European  map 

Independent  producers  and  broadcasters  work  increasingly  with  the  Action 
Plan  to  implement  the  new  16:9  technologies  which  are  already  rjigital  and 
thus play the quality card. 

The  16:9  map  is  European.  16:9  broadcasters  have  come  to  support  each 
other, launching their services together and forging new ties of solidarity in an 
environment  which  still  remains  essentially 4:3.  For example, the Pal+  group 
of  broadcasters  launched  the  16:9 format  in  Germany  in  1995;  certain 
activities  such  as  coverage  of  major  events  like  the  Olympic  Games  are 
organized at European level. 

Broadcasters  and  producers  increasingly  act  as  real  partners  to  prepare  the 
present  and  the  future,  that  is  to  say,  to  create  a  suitable  programme  supply 
which will enable  16:9 services to be made general. That emphasizes their real 
complementarity  in the audiovisual field. By its pioneer work, the Action Plan 
has  awakened  the  European  programmes  industry  to  the  need  for  a  massive 
coordinated  effort  for  a genuine renewal.  16:9 services are a sphere where the 
only successful  action is European. 

31 

CHAPTER  2  -  RESULTS OF THE  ACTION  PLAN 

2.1  New  productions 

2.1.1 

Types of 16:9  programmes 

(expressed in hours for  each call for  proposals) 

Programme 

1/93 

% 

Fiction 

Docu 
mentary 

165 

193 

10 

11 

1/94 

201 

% 

8 

2/94 

320 

% 

9 

1/95 

% 

2/95 

% 

391 

14 

256 

464 

19 

845 

25 

650 

24 

496 

Cartoons etc. 

0 

0 

23 

1 

19 

1 

12 

0 

46 

Cultural 
events 

Sport 

Studio 

230 

14 

312 

13 

402 

12 

500 

19 

297 

613 

466 

37 

28 

471 

19 

1001 

29 

446 

16 

265 

1019 

40 

821 

24 

729 

27 

714 

13 

24 

0 

15 

13. 

35 

TOTAL 

1667 

100 

2490 

100 

3408 

100 

2728 

100 

2074 

100 

Between  1993 and  1995, the Action Plan cofinanced  the production of  12 367 hours 
of  new  16:9  programmes,  about  half  of  which  consisted  of  long-life  programmes 
(fiction,  documentaries, cultural events), 23% sport and 30 live broadcasts. 

The different  categories developed in various ways: 

Significant progress  of the documentary:  2 648 hours produced 

The  documentary  has progressed  steadily  and  significantly:  it rose  from  11% 
of  the  hours  of  new  productions  in  1993  to  24% hours  in  the  last  call,  thus 
more  than  doubling  its  share  of  the  total  hours  of  programmes.  This 
breakthrough  by  the  documentary  shows  that  the  16:9 format  is  particularly 
suited  to  documentaries  with  a  creative  content.  This  result  fits  in  with  the 
objectives  pursued  by  the  European  audiovisual  policy  in  its  concern  to 
encourage  the  creation  of  audiovisual  catalogues.  Documentaries  offer 
significant  long-term  added  value;  professionals  put  their  life  span  at  twenty 
years.  They  can  be  exploited  on  markets  other  than  their  own  (dubbing  is 
easy)  and  can  be  transposed  to  other  modes  (CD-ROM,  multimedia,  video 
cassettes). 

32 

It  should  be  noted  that  on  the  world  market  the  documentary  is  in  full 
expansion,13  and  that  among  European  broadcasters  the  16:9  channels  are 
those which broadcast the most documentaries.14 

Steady progress  of fiction programmes: I 333 hours produced 

Fiction  programmes  have  reinforced  their  position  and  at  the  last  call 
accounted  for  13% of  the  total  hours  of  new  productions  cofinanced  by the 
Action Plan, as against  10% for the first call.  The hourly production costs  cf 
fiction  programmes  are  the  highest  and  the  development  process  is  the 
longest. 

Fiction programmes  in  16:9 form a prestigious part of  European audiovisual 
catalogues.  Some  fiction  programmes  supported  by  the  Action  Plan  enjoy 
wide  popular  success  in  their  countries  of  origin  and,  increasingly  in  the 
European Union. Two examples: 

The weekly  broadcasting of  Tatort is a real event in Germany. Each Sunday, 
this  televised  series,  broadcast  by  ARD,  the  first  public  German  channel, 
reaches  25% to 35% of the  audience;  8 to 9 million  spectators are true to it. 
This  series  is  now  broadcast  on  other  European  channels.  16:9  production 
attracts directors from the cinema and thus enables television technicians  (for 
example,  cameramen,  photographic  directors)  to  film  as  for  the  cinema.  In 
France,  the  Maigret  series  is  very  popular;  fiction  programmes  such  as  La 
rivière  Espérance  or  Vallée  du  Roi  reach  large  audiences  when  they  are 
broadcast. 

Maintenance of the proportion  of cultural programmes:  1 741 hours were produced 

Cultural  events  (operas, concerts, ballets,  live  shows, circus) tend to account 
for  around  15% at each  call.  The  use  of  the  16:9 format  goes  hand in hand 
with  the  aesthetic  and  cultural  quality  of  these  broadcasts.  In  1995,  three 
quarters of the cultural  events were filmed by broadcasters. One quarter was 
produced by independent producers who specialize in this type of production 
and who maintain very close links with various broadcasters with whom they 
plan and make their broadcasts of events. 

13 

14 

in Industry survey, "TV WORLD", September  1995, page  10. 

in "Broadcasting & Cable International", October  1995, page 50. 
Documentary output (%) on European Channels  1993-1994. 

(November  1994), Channel  Four (UK)  10.18%, ARD(D) 6.92%, ZDF (D) 7%. 

33 

Importance and maintenance of the proportion  of studio programmes:  3  749 hours 
produced 

Studio  programmes  are  a  very 
important  part  of  the  programming 
requirements  of  broadcasters  at  every  stage  of  progress  in  16:9  services. 
Studio  programmes  (games,  chat  shows  and  the  like)  have  many  functions: 
immediately filling programming grids, securing the ratings and itsj^ublic and 
the advertisers - the key to the success of the  channel: creating the channel's 
image and establishing its identity. 

Large but declining proportion  devoted to sport: 2 796 hours produced 

The number  of  hours  devoted  to  sport  has been  falling  steadily  since  1993: 
37% of the total volume of hours in 1993, 13% at the last call. But this should 
not be  interpreted  as a decline  in sport in programme  requirements.  Sport is 
one of the strongest attractions in the programming of a television channel and 
retransmissions are extremely important in terms of market shares. Moreover, 
major events like the Olympic Games are faithfully  followed by a public that 
is ordinarily  is  much less  interested  in televised  sport.  It is  also  an occasion 
clearly  identified  by professionals  for renewing  a large part of the television 
sets. 

Cartoons are almost non-existent:  100 hours produced 

1 % of programmes at each call were cartoons. 

In general, broadcasters preferably produce programmes  with a very short life and 
independent producers  catalogue works: 

70% of 
short-life 
the  programmes  produced  by  broadcasters  were 
programmes -  live  studio  shows  or sports  programmes.  The  remaining 30% 
can be broken down into cultural programmes, documentaries and  fiction; 

the  programmes  produced  by 

85% of 
independent  producers  were 
documentaries  and  fiction-  catalogue  works.  The  remainder  of  the 
independent production consisted of broadcasts of cultural events. 

34 

2.1.2 

Programmes analysed by format 

(results expressed in hours per  call for  proposals) 

Format 

1/93 

% 

1/94 

% 

2/94 

% 

1/95 

% 

2/95 

% 

Super 16 

197 

12 

259 

10 

393 

11 

365 

13 

293 

14 

35 mm 

74 

4 

60 

3 

134 

4 

83 

3 

21 

1 

625 video 

698 

42 

1756 

70 

2034 

60 

2092 

77 

1284 

62 

1250 
video 

698 

42 

415 

17 

847 

25 

188 

7 

476 

23 

T O T AL 

1667 

100 

2490 

100 

3408 

100 

2728 

100 

2074 

100 

Four  formats  received  Community  subsidies.  Two  of  them  were  film  media, 
namely the 35 mm  (the cinema film format)  and the super  16 used mainly  for 
television.  The  two  others  were  video  formats:  the  625-line  format  for  the 
conventional  television  video  and  the  high-definition  1250-line  format. 
Through  these  four  categories,  the  Action  Plan  thus  covered  all  aspects  of 
television  production. 

Ceiling on the 35 mm: 372 hours produced 

Compared with other formats, use of the 35 mm rarely exceeded the 3% mark. 
It  is  infrequently  used  in  European  television  production  because  it  is  very 
expensive, but it retains pride of place in certain fiction programmes or certain 
prestige  documentaries.  In  1995,  90% hours  in  35 mm  were  produced  by 
independent producers and  10% by broadcasters. 

The super 16 mm made progress:  1 507 hours produced 

From  12%  at  the  first  call,  it  has  now  reached  14%. This  format  is  the  link 
between  cinema and television  and  is emerging  as the standard  format  for  the 
European  film  intended  for  television.  In  1995,  54%  hours  in  super  16 mm 
were produced by independent producers, a more balanced figure than that  for 
the  35 mm  format.  The  46%  produced  by  broadcasters  were  mainly 
documentaries and fiction. 

Domination of the 625 video:  7 864 hours produced 

This  format  very  clearly  dominated  16:9 services. The 625 video is  emerging 
as that  used  by  most  broadcasters:  in  1995, 80% of the 625 video hours  were 
produced  by  broadcasters.  20% of  the  625  video  hours  were 
lighter 
programmes produced by independent producers who produce series. 

Drop  in High-Definition (1250 video): 2 624 hours produced 

35 

From  42%  in  1993  to  23% at  the  end  of  1995, the  HD  experienced  a  sharp 
drop  in  the  total  number  of  hours  supported  by  the  Action  Plan.  The  1250 
video  is  the  preferred  medium  for  broadcasting  high-profile  sports  events 
(Olympic  Games,  world  championships),  cultural  events  and  documentaries 
with  a  creative  content.  HD  is  used  for  programmes  where  coverage  of  an 
event  calls  for  several  cameras  because  the  video  enables  the  image  to  be 
monitored  rapidly.  Moreover,  the  aesthetic  quality  (realistic  picture,  faithful 
colour 
technique  coupled  with 
the  high-definition 
retransmission  in  16:9 format  is the reason why prestige  events  are  broadcast 
in this  format. 

reproduction)  of 

Broadcasters  devoted  more  time  to  medium-length  documentaries,  while 
independent  producers  preferred  to  make  ambitious  long-length  series  on 
cultural  matters  such  as  music  or  the  arts  in  general.  That  explains  how  in 
1995 60% of the HD video hours were used by independent producers. 

2.2  Remastering 

Remastering  is  a  technique  whereby  programmes  existing  on  one  master  are 
transferred  to  another  master  compatible  with  16:9  broadcasting;  it  is  used  mainly 
for  cinema  films.  On the  launch  of the  16:9  services, remastering  of  films  has  two 
advantages.  It enables programming  schedules  to  be  filled  immediately  much  more 
cheaply  than with new productions, and it can be done very rapidly  if the original  is 
of good quality. 

When  16:9  services  were  being  launched,  broadcasters'  investments  tended  to  be 
spread  over  many  areas.  While  channels  equipped  themselves  with  studios  and 
ordered  works  from  independent  producers,  two  categories  of  programmes  which 
are  extremely  popular  with  the  public  made  it  possible  to  fill  the  programming 
schedules  immediately  without  going  through  the  television  studios -  remastered 
films and sports retransmissions. 

As the  16:9 market develops, the European  16:9 catalogue  grows and the volume of 
16:9  programmes  available  increases.  Circulation  of  these  programmes  to  the 
various  16:9 services in the European  Union  increases  supply. Accordingly  demand 
for remastering is falling  slightly. 

Most  remastering  is  made  on  digital  media  and  it  thus  enjoys  the  technical 
advantages  of those media. Remastering  is a way to make European  film  catalogues 
durable. 

36 

Development in remastering since the beginning of the Action Plan 

Since  the  beginning  of  the  implementation  of  the  Action  Plan,  remastering  has 
accounted for an aggregate 7 422 hours programmes. 

ECU million 

Call 

New 

productions 

1/93 

% 

1/94 

% 

2/94 

.% 

1/95 

% 

2/95 

% 

10.2 

88 

16.7 

86 

30 
> 

91 

15.7 

87 

io 

94 

Remastering 

1.4 

12 

2.7 

14 

3 

9 

2.4 

13 

0.7 

6 

Hours 

Call 

New 

productions 

1/93 

% 

1/94 

% 

2/94 

% 

1/95 

% 

2/95 

% 1 

1667 

57 

2490 

55 

3408 

60 

2728 

67 

2074 

81 

Remastering 

1269 

43 

2065 

45 

2240 

40 

1371 

33 

477 

" 

The  budget  for  remastering  followed  the  general  budget  trend  of  the  calls  for 
proposals and the percentage of the total budget allocated to remastering was 10.7% 
at 31 December 1995. 

2.3  Professional equipment 

Broadcasting  equipment  is  still  largely  dominated  by  the  4:3  format,  and  few 
broadcasting  channels  are  completely  equipped  with  16:9.  Little  by  little, 
professionals  are  changing  their  equipment  from  4:3  to  16:9.  They  begin  by 
purchasing new cameras: 50% of professional  cameras sold are cameras which are 
switchable from 4:3  to  16:9.  Moreover,  this  trend  pushes  prices  down and thus 
encourages  further  purchases.  At  the  end  of  1995,  the  penetration  rate  of  16:9 
cameras of the European market was 10 to 15%, with a top rate of 30% in the most 
advanced countries. 

625 video equipment is now spread throughout the European Union. '5 

37 

Studio 

OB-van 

F 

4 

12 

St/OB camera 

90 

ENG camera 

|  Editing 

15 

10 

D 

15 

2 

85 

? 

UK 

4 

1 

E 

0 

9 

30  > 

11 

5 

5 

7 

5 

NL 

7 

7 

75 

10 

12 

B 

6 

4 

40 

? 

5 

GR 

IRL 

3 

0 

21 

13 

0 

3 

0 

8 

6 

4 

15 

in 16:9 equipment, Widerview Conference, Brussels, 6.12.1995. 

38 

CONCLUSIONS 

Expanding the audiovisual  catalogues 

In two  and  a half  years, tlie Action  Plan  cofinanced  19 789 programme  hours  for  a 
total  of  ECU 94.6 million.  This  volume  of  hours  can  be  broken  down  into  7 
422 hours  of  remastering  and  12 367 hours  of  new  productions.  Among  the  new 
productions,  there  were  2 648 hours  of  documentaries,  1 333 hours  of  fiction 
programmes  and  1 741 hours  of  cultural  events.  These  stock  works  are  a  major 
contribution 
to  European  audiovisual  catalogues,  the  business  asset  of  the 
programmes  industry  as a whole. Thus  independent  producers  stepped  up their role 
in  the  creation  of  these  catalogues.  For  them  the  16:9 format  is  a  substantive  and 
formal argument in favour  of quality  production. 

In order to make  16:9 services general throughout Europe, less mature markets must 
be  equipped  with  them.  1995  was  the  year  the  Action  Plan  used  the  budgetary 
reserve  for  that  purpose.  The  generation  of  an adequate  supply  of  programmes  and 
tlie creation  of a programme  catalogue takes time: independent  producers need  time 
to  adjust.  The  Action  Plan  is  monitoring  this  trend  and  supports  those  producers 
during  this  transitional  stage.  The  Action  Plan  which  is  improving  its  programme 
data base is finalizing  the preparation of the European  16:9 catalogue, which will be 
available on WWW via the European Commission's Europa server. 

A partnership for a dynamic 16:9 market 

Through  the  dynamics  of  the  Action  Plan,  broadcasters  and  producers  act  as  true 
partners  in  the  supply  of  16:9  services,  proceeding  from  their  complementarity  to 
create a viable supply of material  which will make  16:9 services generally  available 
at European  level. After  two  and a half years of  implementation  of the  programme, 
the  budgetary  funds  of  the  Action  Plan  were  evenly  distributed  among  them: 55% 
were allocated to broadcasters and 45% to producers. Broadcasters were responsible 
for  68%  hours  and  independent  producers  32%.  For  the  most  part,  broadcasters 
engage  in  remastering  and  produce  very  short  programmes  which  establish  their 
channel's identity. This identity attracts an audience which will then become loyal to 
other types of programmes. 

The programmes industry  invests in the future at European level 

The  Action  Plan  made  the  programmes  industry  durably  aware  of  the  need  for  a 
massive,  coordinated  effort  to  renew  and  upgrade  professional  equipment  and 
practices.  That  is  also  where  the  impact  of  the  Action  Plan  lies:  it  made  European 
producers aware henceforth  that they should invest in the future  at European level. If 
the soundness  of the Action  Plan  were to be questioned,  the entire sector would  see 
it as a disavowal  of the action  taken  so  far,  including  its underlying  principles. Too 
small  a  budget  would  slow  down  to  the  point  of  stopping  the  introduction  of  16:9 
services on late developing  markets and would compromise current  production. 

39 

GENERAL  CONCLUSIONS 

International competition and innovation 

The  European  audiovisual  industry  faces  international  competition.  In  addition, 
there  is  the  challenge  of  technological  innovation  which  will  enable  it  to  remain 
competitive.  Thus the audiovisual  industry  must constantly  prepare  its future.  The 
ongoing  digital  revolution  is  boosting  efficiency-,  though  it  is  causing  a review  of 
conventional broadcasting modes. A first result is the multiplicity of channels. 

The  industry  must  take  up  a  dual  challenge:  modernize  and  consolidate.  It  is 
imperative that an effort  be made to adjust to the future in a coordinated manner in 
order  to  achieve  the  European  dimension  essential  to  ensure  that  the  European 
audiovisual industry holds its own in world competition. 

Integration of the new technologies into the European audiovisual industry 

This  is  the real  context of the Action Plan's objective - the emergence  of a critical 
mass  of  advanced  television  services.  The  audiovisual  industry  must  pass  a 
threshold  beyond  which  there  will  be  an  autonomous  impetus  resulting  in 
generalized  16:9 services on a European scale. For the moment, the critical mass of 
16:9 services has not yet been reached. 

The  16:9  format  is  the  format  of  the  future.  That  was  confirmed  in  terms  of 
European  rules  and  regulations  by  the  October 1995  Directive  on  transmission 
standards.16  Professionals  who  commit  themselves  to  the  16:9 format thus  commit 
themselves  to  rethink  the  long-term  future  of  their  profession,  their  audiovisual 
catalogues and television. 

The  16:9 format is part of a broader challenge - the integration of new technologies 
into the European audiovisual industry which it helps to encourage. Already, digital 
television  is  not  spoken of  in terms  of  the  future  but of the  present.  Because  it  is 
neutral in terms of standards, the  16:9 format leads to projects at European level  in 
the field of the new technologies. 

16  Directive 95/47/EC  of  the European  Parliament  and of  the  Council  of  24 October  1995  on 

the use of standards for the transmission of television signals. OJ L 281,  23  11.1995. 

ANNEX  1 

Figure 1A 

Broadcasting Costs 

First 50 hours 
From the 50 first hours 

Figure IB 

Revised Programme Making Costs 

Programme Type 
_____ 
Programmes remastered from existing material, suitable for 
broadcasting in 16:9 and in 625 lines 
Programmes remastered from existing material, suitable for 
broadcasting in 16:9 and in 1  250 lines 
Super 16 mm 
16/9 625-line video production 
a)  stock programmes 
b) 
_^ 
35 mm production 
HD-video production (1250 lines) 
a)  stock programmes 
b) 

flow programmes hours  '  1  to 20 

21st and following hours 

flow programmes hours 

1to20 

__ 

21st and following hours 

Flat rate 
(ecus per hour) 
6 000 
2 500 

Flat rate 
(ecus per hour) 
3 000 

5 000 

12 000 

12 000 
12 000 
6 000 
30 000 

60 000 
20 000 
10 000 

• 

kd 
ANNEX 2 

Comparative Evolution between  Sales of TV  16/9 and the no, 
of hours for Programmes  Broadcast in  16/9 in Austria 

90,0 
80,0  --
70,0 
1  60,0 
«3  50,0 
|  40,0 
|  30,0 
£  20,0 
1 10,0 
w  0,0 

16/9  Programmes 

starting  in 1996  \  sooo 

12000 

@  Sales 

-10000 

-•- Hours 

50 

6000 

4000  1 

2000  « 

0 

o 
M3 

0 
-*  !-

1992 

0 

0,7 

1993  1994  1995  1996 
forecast 

Comparative Evolution between  Sales of TV  16/9 and the no. 
of hours for Programmes Broadcast in  16/9  in  Denmark 

90,0  j 
80,0  --
70,0  --
I  60,0  -
«g  50,0 -
|  40,0 
|  30,0 
I  20,0 
8  10,0 
S  0,0 

16/9  Programmes 

starting  in 1996 

0 

1992 

^—E£3—j.  SH 
1994 

1993 

10 

WJtt 
1995 

1996 
forecast 

12000 

S  Sales 

10000 

-^ Hours 

8000 

6000 

bo 

4000  1 

! 

2000  *? 

0 

o 

LtV 

Comparative Evolution between Sales of TV 16/9 and the no* 
of hours for Programmes Broadcast in 16/9 in the UJL 

90,0  T 
80,0  --
70,0 
I  60,0  -
I  50,0 --
I  40,0 
30,0 
20,0 
10,0 
0,0 

o 
•a 
.5 
CO 

1992 

1993 

1994 

Comparative Evolution between Sales of TV 16/9 and the no. 
of hours for Programmes Broadcast in 16/9 in France 

j  12000 

•10000 

-8000 

•6000 

-4000 

-2000 

0 

60 

T3 
CQ 

o 

o 

1992 

1993 

1994 

1995 

1996 
forecast 

Irt 

Comparative Evolution between Sales of TV 16/9 and the no* 
of hours for Programmes Broadcast in 16/9 in Germany 

12000 

@ Sales 

-10000 

-•-Hours 

-8000 

4-6000 

| 

-4000 

| 
is 
2000  © 
o 
-53 

1992 

1993 

1994 

1995 

1996 
forecast 

Comparative Evolution between Sales of TV 16/9 and the no* 
of hours for Programmes Broadcast in 16/9 in Greece 

90,0 
80,0 
70,0 

|  60,0 -f  16/9 Programmes starting in 1995 
|  50,0 
|  40,0 
3  30,0 
I  20,0 
a 
10,0 
0,0 

73 
CO 

1992  1993  1994  1995  1996 

forecast 

4000  g 
4-2000  .o 
3 
O 
X 

0 

12000 

B  Sales 

10000 

-«- Hours 

8000 

60-

6000  -3 

i/y 

Comparative Evolution between Sales of TV 16/9 and the no. 
of hours for Programmes Broadcast in 16/9 in Italy 

12000 

saSales 

10000 

-•-Hours 

C»4 

90,0  y 
80,0 
70,0 
|  60,0 
3  50,0 
O 
40,0 
30,0 
20,0 
10,0 
0,0 

13 
CO 

t3 

O 

- -  16/9 Programmes starting in 1996  -J- 8000 

oO 

6000 

4000 

| 

+  2000  ? 

5 

3 

6,3 

„J~_-JJ5J38~»~J 

rtaysn 

) 

& 

1992  1993  1994  1995  1996 

forecast 

Comparative Evolution between Sales of TV 16/9 and the no. 
of hours for Programmes Broadcast in 16/9 in Portugal 

90,0 
80,0 
70,0 + 

I  60,0 
<S 50,0  --
w 
40,0 
30,0 
20,0 
10,0 
0,0 

v> 
P 
O 
•8 
.£ 

CO 
1> 
13 
CO 

16/9 Programmes starting in 1996  - - 8000 

12000 

SSales 

-10000 

-•- Hours 

6000 

i 

4000 

| 

4-2000 

°" 

S 

1992 

1993 

1994 

1995  1996 
forecast 

n£ 

Comparative Evolution between Sales of TV 16/9 and the no. 
of hours for Programmes Broadcast in 16/9 in Spain 

90,0 T 
80,0 --
70,0 --
I  60,0 --
1  50,0-
|  40,0 -
J  30,0 
I  20,0.» 
8  10,0 -
S 0,0 

T  12000 

-10000 

-8000 

-6000 

60 

4-4000  1 

JO. 

S 

1992  1993  1994 1995 

1996 

forecast 

Comparative Evolution between Sales of TV 16/9 and the no. 
of hours for Programmes Broadcast in 16/9 in Sweden 

12000 

S  Sales 

10000 

-•-Hours 

8000 

90,0 
80,0 
70,0 

|  60,0 -|-  16/9 Programmes starting in  1995 
|  50,0 
|  40,0 
I 30,0 
I  20,0 
*  10,0 
13 
CO  0,0 

6000 

I 
3 
u 
4000  g 
43-
4-2000  « 
& 

0 

1992 

1993 

1994 

1995 

1996 
forecast 

ISSN 0254-1475 

COM(96) 346 final 

DOCUMENTS 

EN 

16  15 

Catalogue number  : CB-CO-96-345-EN-C 

ISBN 92-78-06632-X 

Office  for Official  Publications of the European Communities 

L-29S5 Luxembourg