Spain: Bust. Or Boom?

Spanish cinema is facing one of the most challenging moments in history as the country battles to emerge from a five-year economic crisis. But while the numbers seem to depict an industry in decline (see below), the story behind them hints at a brighter future.

Last year was undoubtedly tough. Production levels fell, budgets fell and, thanks partly to a 21% tax on cinema tickets, admissions fell. Companies closed, including Alta Films, Spain’s leading distributor of international auteur titles, and cinemas shut down.

The government’s shake-up of public film financing, both direct production investment and funds aimed at attracting inward investment and increasing international co-productions, remains indefinitely delayed.

Government finance minister Cristobal Montoro exacerbated the sense of catastrophe and infuriated the local industry when he was quoted as saying the problems of Spanish cinema “are related to the quality of their films”. He later apologised.

But the general feeling throughout the industry is that 2014 promises to be a much better year. The Spanish economy is predicted to grow as the country is poised to emerge from a devastating recession. There is a belief that the worst is behind Spain.

Many also believe the film industry will rebound as a more professional, international and dynamic sector than it has ever been, with more audience-focused product and an increasingly market-savvy approach to marketing, distribution and promotion.

“It has been a tough period and still is,” admits Morena Films’ Juan Gordon, who produced the romantic drama Scorpion In Love and the thriller Combustion in 2013. “But in the past there were too many films produced each year and some of them were not that good. Only the best film-makers have survived and there has been a necessary sifting. We’re producing less but better films.” 

In the same week in October that Montoro made his notorious comment, four Spanish films were in the top 10 at the local box office: Zip & Zap And The Marble Gang, a family film that has been sold around the world; Alex de la Iglesia’s frenzied comedy Witching And Bitching, Daniel Sanchez Arevalo’s romantic comedy Family United; and also Justin And The Knights Of Valour, an animated feature that was produced by Antonio Banderas.

The Impossible producer Enrique Lopez Lavigne, co-founder with Belen Atienza of the leading local outfit Apaches Entertainment, is cautiously optimistic. Last year Apaches enjoyed box-office success with romantic comedy Three Many Weddings and the low-budget People In Places, which played well at Toronto.

“We started our company during the crisis and I’ve always seen this moment as a transitional period,” he explains. “We have learned to be more dynamic and clever than ever. Every film is a tentpole and you have to work hard. We waited a year to release Three Many Weddings after finishing it because [distributor] Warner [Bros Spain] was convinced this was the best date.

“I think that very often [Spanish film-makers] forgot who we were making the films for. We have to make blockbusters that hit big during the weekends, and some for an older audience that perform better during the week. The auteur cinema that crosses borders can only be made with a very small budget and the best window for it is VoD. Middle films are the ones that are likely to disappear.”

Lopez Lavigne suggests that while Spanish films have historically been made for the local audience, there is now a greater focus on the international market. “The only way to survive is to make global products,” he says.

Co-production rules are steady, and producers are expecting the new cinema law to improve tax deductions. Gordon says: “Co-production laws are at this point very advanced. There are no problems now to shoot in English, as you may have in France.”

Spain has a reputation for genre films and last year the most successful titles included Andy Muschietti’s Mama (which grossed $10.5m at the Spanish box office), The Body ($8.5m) and The Last Days ($2.7m). Comedies including Family United ($4.3m), Three Many Weddings ($7.5m), Witching And Bitching ($6.8m) and Pedro Almodovar’s I’m So Excited ($6.5m) also did reasonably well.

“Comedies have growing international appeal and the key point is they have a strong identity,” Lopez Lavigne points out. “Going global not only means making English-language films or big films like The Impossible. We cannot make this every year.”

Diversity is key, agrees Ramon Colom, the new director of national producers association FAPAE. “We are succeeding with films that are very different from what has been commonly known as ‘Spanish cinema’,” says Colom. 

“We are gaining the young and the family audience that previously belonged almost exclusively to Hollywood. There is also an obvious change in the attitude of Spanish people towards our films. Audiences are beginning to value their quality. We have been deeply affected by the general economic crisis and as things are getting better, we’re ready to provide our audience with better films than we used to.”

With the banks out of credit and the government slashing public film funds, Spain’s broadcasters have stepped into the breach to become the biggest financiers of Spanish films. This brings its own problems, including a preference for primetime-friendly event titles, and a demand for window exclusivity that threatens the rising VoD sector. (The film industry is frustrated by the lack of progress against Spain’s rampant piracy problem.)

Producer Jose Antonio Felez, who has enjoyed success with Family United and is finishing cop thriller Marshland, warns of the production sector’s reliance on the ratings-aware broadcasters. “The risk is that we lose diversity,” he says. “To have good films, some bad films also need to be made.” 

The closure of Alta Films, one of Spain’s best-known companies internationally, was a blow for international producers and sales companies. But former Alta chief Enrique Gonzalez Kuhn has now launched Caramel Films, which will have a similar focus to Alta.

His first acquisitions include Pawel Pawlikowski’s Polish drama Ida and Maria Sole Tognazzi’s Italian feature A Five Star Life.

Adolfo Blanco, the head of distributor A Contracorriente, which distributes European films for a mainstream audience, describes a general feeling: “[A Contracorriente] is financially alive thanks partly to the great success of Intouchables [which grossed more than $20m in Spain for the company in 2011],” he says.

“The policy right now is to be conservative and to work as hard as we can on every title. We have gone through the worst of the scenarios and we are fighting to arrive alive at the end of this crisis. This year it looks like things are likely to improve.” 

Spain 2013: in numbers

• Admissions fell for a fifth year in a row to 74 million in 2013, from 94 million in 2012 and from the record-breaking high of 144 million in 2004.
• The number of films going into production fell by 18.1% year-on-year to 149 films. Just 13% of those were budgeted at more than $2.7m (€2m).
• The market share for Spanish films at the box office was 13.9% in 2013 and there was no Spanish film in the top 10. In 2012, the record-breaking success of The Impossible raised the market share of local films to 19.5%.
• The resources of the public film funds on which Spanish producers depend are being depleted. The ICAA budget was $105m in 2011, down to $76m in 2013 and cut again to $70m for 2014.