Levy on Netflix and pay TV could deliver €25m a year for Irish film-makers

New report suggests additional revenues will be needed by the sector to support Irish content creators

Daisy Edgar-Jones and Paul Mescal as Marianne and Connell in 'Normal People'

The Oscar-nominated 'Wolfwalkers'

Daisy Edgar-Jones and Paul Mescal as Marianne and Connell in 'Normal People'

The Oscar-nominated 'Wolfwalkers'

Samantha McCaughren Twitter Email

March 28 2021 02:30 AM

A new levy on streaming services such as Netflix and Disney+, as well as on TV advertising on Sky and other services, could deliver as much €25m-plus a year for Irish-made content, according to a new report.

Consultants Indecon modelled several scenarios for a National Media Creative Content Fund, which would capture some of the vast profits that new so-called streamers make in Ireland and other EU states, without any local investment.

The most modest model outlined in the report would contribute around €26m to the independent production sector over five years, while a bigger levy could result in just over €125m in five years.

The report – ‘Analysis to inform potential National Media Creative Content Fund’ – was done on behalf of the audiovisual creative sector, and was paid for by RTÉ and TG4.

While the fund would result in direct funding for Irish productions, the financing would also be leveraged, resulting in more investment for projects, according to Indecon. For example, if levies resulted in €125m over five years, this could lead to output totalling €490m over the same period, as other backers would be more likely to come on board.

Industry sources pointed to drama series such as Normal People and animations such as Wolfwalkers to illustrate the type of Irish content that can be delivered when funding is available.

The report looked at levies and financial requirements in place across Europe and examined options such as levies on streamers, pay TV and TV advertising. Due to state aid rules any levy would also have to apply to advertising on Irish broadcasters, so RTÉ would be among those paying into the fund.

However, RTÉ would also be a significant beneficiary, due to the indigenous programming being produced.

Most of the money would come from pay TV channels, but the huge explosion in popularity of streaming services would mean they would be likely to contribute an increasing amount to any such fund.

The six scenarios range from levies of 1pc on subscription revenues of pay TV and streamers in Ireland (as well as on TV ads); to a 2pc levy on pay TV and streamers and a 4pc levy on TV ads.

A levy or other financial obligations to support the audiovisual sector is envisaged under the EU’s revised Audiovisual Media Services directive – and other European countries are also developing such schemes.

Depending on how much the fund would collect, additional direct and indirect new jobs could range from 649 to more than 3,200.

The report, which interviewed several industry players as part of its research, found that the sector would need a much needed boost after the pandemic.

“This sector is of importance from a cultural perspective, and ensuring its success is an important public interest objective because of the role the sector plays,” said the report.

“Irish audiovisual content provision is an important highly skilled labour-intensive sector – and without additional sources of revenue, the sector will be significantly hit by Covid, and hit indirectly by emerging developments in the advertising market in Ireland, which will impact negatively on traditional broadcasting.”

The report comes against a background of reduced expenditure by RTÉ, which is commissioning fewer independent productions due to financial pressures.