“Netflix Law”: Should streaming platforms finance Swiss cinema?

On May 15th, the Swiss people will speak out on the modification of the cinema law. For the Federal Council and the parliament, this modification will, in particular, “strengthen Swiss cinematographic creation and will contribute to the cultural diversity of the digital offer”. For its part, the referendum committee is opposed to this project, considering in particular that this modification will “penalize” above all films from around the world, while “increasing the price of subscriptions”.

Read: Where did ‘Netflix Lex’ come from? back to source

So what to do? To help you position yourself, the editorial team of “Le Temps” has offered to follow along and participate in an online debate with:

Alec von Barnekow. A computer scientist by profession, he is vice-president of the Young Radical Liberals of Switzerland and president of the Young Radical Liberals of Freiburg. He opposes this change in the law.

Oleg Gafner. Festival director and administrative assistant, he is co-chair of the Young Greens and vice-president of the Swiss Greens. He is in favor of this change in the law.

This video chat is moderated by Nicolas Dufour, journalist for “Le Temps”, especially specializing in TV series. It should be revived at the beginning of the article. A summary can also be read below.

Why face this project that proposes to encourage platforms to invest in Swiss cinema?

Alec von Barnekow: This project is an injustice to consumers, which we want to protect. It is up to them to choose what they want to consume and therefore ultimately what they want to pay for. We also protest against a law that protects special interests. That is, those in the movie lobby.

Why force online platforms to invest in national audiovisual?

Oleg Gafner: The platform will invest the money in their own projects, so we will not restrict their catalogue. When you buy a subscription on this type of platform, you buy a catalog that is constantly evolving and adapted to European standards. We want to give access to these new tools to professionals in the sector in Switzerland. We do not protect the interests of individuals: the only cultural sector in Switzerland that depends on the Confederation is the cinema. We defend a cultural identity.

Read: According to “Lex Netflix”, 30% of European works? The streaming giants want to do it anyway

Public authorities are already investing in audiovisual production in Switzerland. Why do you still want to look for money?

Oleg Gafner: Is not the same thing. These bodies seek to support production to protect public service interests. We are not talking about subsidizing a sector that needs subsidies. We are advocating a law that costs the Swiss population nothing and will have repercussions on the Swiss economy: 1 Swiss franc invested in cinema in Switzerland brings 3.10 Swiss francs to the local economy. It’s all profit.

The Swiss are already able to sell some movies and series to these online platforms. Why not give them an extra boost?

Alec von Barnekow: It is an excellent thing and proves that this law is not absolutely necessary in cinema to have the entrance keys. This referendum absolutely does not call into question the 120 million francs that cinema receives. We do not want the consumer to go to the cashier because he is the one who will pay this amount one day or another.

Do you have any examples of countries where these platforms raised subscription prices when they had to invest?

Alec von Barnekow: No, but you don’t need to do HEC to know that one day or another, anyway, it will be passed on to the consumer. Netflix and the others don’t have money printing. Money doesn’t fall from the sky. Someone will have to come to the cashier. And it will be, as always, consumers who will pay.

Oleg Gafner: In the European comparison, in any case, at the level of our French and Italian neighbours, the reinvestment rate is massively higher than the expected rate in Switzerland.

Finally, shouldn’t the French television stations present in Switzerland – TF1 and M6, which benefit from advertising revenue in Switzerland, also invest in national cinema?

Alec von Barnekow: Many companies make money from customers in Switzerland when they are not present in the country and therefore do not pay taxes here. They should be taxed when we are the first to say that when our Swiss companies do business abroad they should above all not be taxed. All this is not consistent. This taxation issue will, however, soon be resolved by taxing all OECD companies at 15%.

Read: The Netflix Law, “Not a Matter of Money, but of Abundance”

Small regional televisions will also be obliged with this investment obligation and the 30% of audiovisual works. Isn’t that unfair?

Oleg Gafner: The law, however, includes many guarantees, in terms of deductions in particular, which can be made especially on advertising costs. We are really talking about large foreign companies. I am pleased to know that the PLR ​​is pleased to tax foreign companies more heavily and to support more strongly the next message on culture and to accept the amendments to strengthen these aids. But as far as the mechanism is concerned, we are not in the tax, we are in the reinvestment.

Currently, our money is used to produce Netflix series in France, Italy and even the United States. Why finally let the money out of Switzerland when we could have some of it?

Alec von Barnekow: By subscribing to a platform, be it Netflix or any other, you are convinced of the service it offers and accept its price. And just like that, you stick to an existing catalogue. I always find it a little unfortunate that people come here to propose to modify these catalogues, pressuring them to add Swiss productions. I am also convinced that if we accept this law on May 15th, we will want to do the same for other sectors, such as music.

Oleg Gafner: In France, which is pushing platforms to invest, it’s interesting to see that Netflix is ​​investing even more than it should.

Conventional television has 50% restrictions on European films. It doesn’t seem to bother anyone…

Alec von Barnekow: This is not the subject of this referendum. With this law, we will add a completely arbitrary quota of 30%. It’s protectionism, it has no reason to be. If people subscribe to Netflix or Disney+ to watch American productions, it’s their right to do so. European works are already sufficiently protected. Let’s draw a parallel: imagine that each restaurant had to impose 30% of European dishes. Would you find this normal? It is not up to legislators to come and impose what these platforms must offer on their catalog menu.

Read: Strong uncertainty around “Lex Netlix”

These platforms already invest a lot of themselves in the countries. Why would you want to force them when you can do that with the market?

Oleg Gafner: The business model of these platforms is to invest, buy. Back to the catalogue, we share our catalog with neighboring countries that have the same language and have this obligation of 30% of European films and productions, for example France. So when you choose in your soul and conscience to pay Netflix in French-speaking Switzerland, you already accept that 30%.

When I go to the cinema, I go to see the movie that interests me. The share of American cinema is around 70%. The market is moving in the direction of this law, right?

Alec von Barnekow: I don’t think so, because if that was really the objective, we wouldn’t have put it in the law. 9.4% of movies offered on streaming platforms are Swiss, but they represent only 0.4% of what people consume. This is proof that we want to pressure people to watch what they don’t watch.

Oleg Gafner: This is misinterpreting cinema. Cinema is divided into dozens of crafts. This 4% allows Switzerland, in its various points of sale, to align and participate in co-productions in particular. That will be the main thing. One in two films released in Switzerland is a co-production. We can thus shoot a film in Andorra, but feature a Swiss screenwriter with German funding. It will not be categorized as such, but it will cater to that 4%.

Is this law vital for Swiss cinema?

Oleg Gafner: No, because Swiss cinema works without it. The objective is to provide a new tool, align the exercise of this profession with European standards, allow our professionals to shine internationally and prevent our talents from leaving the country. Switzerland also invests a lot in their training, our schools are excellent. We only ask to access a competitive European market and the same tools used by our francophone partners.

Alec von Barnekow: I understand, but we also have to talk about consumers. In the end, they will be the losers of this law.

Read: Where did ‘Netflix Lex’ come from? back to source

Oleg Gafner: Countries that have imposed this mechanism have never experienced an increase in subscriptions. Subscription prices for these platforms depend on purchasing power. In Switzerland, we already have the most expensive season ticket. And Netflix has already increased its subscription without this mechanism. So you don’t have facts to support this argument. It is proposed that consumers have more diversity without paying more and that Swiss cinema aligns with European practices.

With this law, we also support a sector economically, right?

Alec von Barnekow: Economic circles are fighting this law because it sets a precedent and protects special interests. And that’s exactly what a free economy doesn’t need.

However, within the PLR, your party, there is debate…

Alec von Barnekow: As in any democratic party, there is debate and that’s okay. Only three sections in Switzerland of the PLR ​​are for this law. Everyone else says no, it’s too big. We cannot speak of division in all cases.

If this law is passed, will Netflix be able to dictate its law choosing the themes and types of movies to be made?

Oleg Gafner: Netflix may choose to buy movies, promote movies, co-produce movies. The platform will be able to choose freely according to its market. We talked a lot about the movie “Almost” with Alexandre Jollien and Bernard Campan. The few scenes filmed in Lausanne for this film brought in almost double the budget alone. So those are the economic benefits.

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