Streaming platforms’ contribution to capitalization of local audio-visual producers in Mexico and Canada

Abstract

This article examines the contribution of streaming platforms in providing financial investment – in the form of co-productions, commissions and acquisitions of audio-visual content – as well as capital returns to local audio-visual producers. It will focus on the North American region, particularly on Mexico and Canada, as gravitating around stronger US audio-visual companies. Studies of traditional audio-visual windows in the countries studied have pointed out the undercapitalization of independent content producers due to financial structures and capital return models that are disadvantageous to them. This article questions: what is streaming’s contribution, as a new commercialization window, to the capitalization of local independent producers? The research conducted a qualitative study of interviews with film producers and distributors as well as an industrial analysis based on previous studies, media and business reports. The research has found that streaming tends to provide: (1) equal or slightly less returns than what the DVD window used to offer; and (2) equal or more generous figures than those delivered by TV and cinema exhibition windows. Furthermore, streaming has promoted a burgeoning production activity – adding to the production from traditional players (film and TV). These are benefits that should not be overlooked. However, streaming has not altered independent producers’ disadvantageous position: (1) revenue shares are still relatively small; (2) licences represent small percentages of what content costs to make; (3) commissioning and co-production budgets are fairly close to production costs; and (4) the boom of platforms’ original production is actually a battle among large corporations to control intellectual property (IP). All the above keep hindering the financial capacity of local independent producers.