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Tracking the Cultural Exception, Part Three: For Your Grandad’s Audiovisual Industry

Protectionist audiovisual policies are not only inefficient, they’re outdated. Protectionist policies don’t translate into profits because they are built for an audio-visual industry that no longer exists. Gone are the days when effective broadcasting was about building a mass audience. In the world of Netflix and Hulu, screen quotas for local content have been rendered obsolete. Today’s viewers are globally minded and know how to access the media they want—wherever it may come from. As users gain access to more content delivery channels, their power in the market has increased astronomically. The more successful audiovisual producers have realized that drawing uninterested consumers to their products is now a losing game. Instead, their focus should be on maximizing the time spent by audiences who already choose their content. Protectionist measures like television broadcast quotas do little to stop foreign television shows from making their way into the market via Internet-provided television (IPTV), which is on the rise. According to a Nielsen study, “As of February 2012, 10.4 percent of homes had an IPTV, compared to just 4.7 percent that same month a year prior.” In cinema, technology is increasing production quality in a way that is changing the face of the industry. Quality expectations have become such that the funding necessary for a feature film is more than what many companies can raise on their own. This trend has been driving an increase in co-produced films (as a United Nations study attests), especially between Latin American and European producers. As I mentioned in the last segment, this has been a major factor behind the success of Argentina’s film industry. This is not only a good general strategy, but also a way to effectively compete with Hollywood. The U.S. film industry is no less protected than Europe’s (which I’ll discuss in the next segment) and partially thanks to these subsidies, Hollywood productions have massive budgets. By pooling resources non-Americans could better compete with U.S. blockbusters but have limited their own options through quotas which restrict the amount of foreign investment in domestic productions. No matter where it comes from. Protectionist policies, however, are ostensibly intended not so much to promote these industries as to protect a nation’s culture. They fail on that count as well. Consider the two examples.
This hit Colombian show even spawned a U.S. adaptation, Ugly Betty.

First, the popularity of the telenovela, a popular Latin American time-limited soap opera format, shows that language and cultural preferences are a stronger force than protectionists generally acknowledge. Telenovelas flourished despite massive market penetration in Latin America by U.S. content (and now are even being exported to markets around the world). Second, American TV and movies are quite popular in France, despite heavy protections. French consumers are not as constrained as they once were, as protectionist policies no longer pose a significant barrier to accessing content from around the world. But for those concerned about people getting the proper level of cultural diversity in their media consumption, never fear! People still watch French-produced TV shows. An example of this is the popularity of the French show “Spiral,” which may get a boost from Netflix’ suggesting it to fans of the American-produced “The Killing.” Viewers today have more options in the media they choose to consume, which means they're consuming more media from a greater variety of sources. From the standpoint of both media-producing companies and those concerned about culture, that is fantastic news. To me however, that more consumers get exactly what they want, is the progress worth celebrating.