Camerimage 2009

T. Perronnet EAMER MKG Director

Global box office was up 5.2% in 2008, to a new record of more than $28 billion. Domestic box office also set a record at $9.8 billion, up 1.7%.

Data source: MPAA

Through July, 2009: •  Domestic box is up another 4%

ü  Soft economy ü  Various strikes (WGA & SAG )

ü  overstock situation for FF productions ü  2 out of the 3 main revenue Stream shrank

1.  DVD sales : -13%

2.  Commercials revenue for TV : -10 to - 13% WW.

3.  Box office : very good : +4 % vs 08.

Ø  everyone explore new options !!!!

ü  Fewer American productions shooting in EU (-50%) ü  Independant production protected for a while …. But

catched up by market reality ¡  - Gvt fundings help to amortize the Independant market. ¡  - Distributors & TV are buying @ 30 to 40% cheaper vs 08.

Ø  WW FF market shrank by at least 5 to 7%

FF Production : major trends

Nb of films produced, 20 most prolific countries

2004 2005 2006 2007 2008% change 08 vs 07

North America 744 821 770 767 601 -21.6%All Europe 1203 1302 1380 1490 1508 1.2%Asia 1641 2179 2406 2585 2583 -0.1%Latin America 231 263 331 308 312 1.3%World 4237 4665 5011 5298 5134 -3.1%

2005 2006 2007 2008 % change 08 vs 07

2005 2006 2007 2008 % change 08 vs 07

India 1041 1016 1164 1325 13.8% Korea 82 110 124 113 -8.9%EU (27) 1045 1067 1150 1190 3.5% UK 124 134 117 111 -5.1%USA 699 673 656 520 -20.7% Iran 26 77 105 100 -4.8%Japan 356 417 407 418 2.7% Argent. 60 60 80 90 12.5%China 260 330 402 406 1.0% Brazil 90 142 117 90 -23.1%France 240 203 228 240 5.3% Indones. 50 60 77 85 10.4%Rus. Fed. 160 200 200 220 10.0% Canada 122 97 111 81 -27.0%Spain 142 150 172 173 0.6% Mexico 53 65 70 70 0.0%Italy 98 116 121 154 27.3% Switzerl. 47 50 76 58 -23.7%

Ø  Could loose around 400 FF vs 08

40% of FF are Co-produced in EU

Now is all about Location, location, location Ø  Tax and rebate incentives abound

Ø  Chasing lower production costs

Ø  Post forced to chase productions

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

ww

US

EU (2

7)

FR

UK

GE IT

SP

BE

NL

POR

T

CZ

RO

POL

BUL

CH

SWED

DEN

IRE

FIN

CO - PROD

ü  - WGA strike, SAG strike ultimately averted but the damage was there any way ….

# of US TV Pilots

04/05 05/06 06/07 07/08 08/09 Total 124 120 100 91 103

ü  - EU : Broadcasters reduced their # of programs & financed 30% less !

Ø  Some contrasty results : Ø  GE & Italy very good year but UK & FR suffered.

ü  35 2 perf for TV : 100 % of Fr Tv channels « tested » the format in 09

0

20,000

40,000

60,000

80,000

100,000

Num

ber o

f 1st

run

scre

ens

Domestic 36,020 34,538 34,884 35,669 37,607 38,677 39,869 39,914International 36,564 38,297 39,597 41,748 43,599 45,783 47,986 48,922WW 72,584 72,836 74,481 77,417 81,205 84,459 87,855 88,836

2001 2002 2003 2004 2005 2006 2007 2008

WW 1st run screens grew 3.2% per year from 2001-2007. With the global economic crisis, 1st run screen building slowed in 2008 to 1.1% growth.

Data source: EI BR

60% of total screens worldwide are considered 1st run. 9.9% of WW 1st run screens are digital (or 6% of total screens).

Data source: Screen Digest, EI BR

¨  The Industry is stalled -  Low VPFs + low exhibitor contribution + high integrator

margin = lower interest rates and/or longer terms

-  Tough economic proposition (8-10 year payback) coupled with a credit crisis

Ø  Box office is up in majority of the countries Ø  Traditional exhibition is up as well as D.cinema

Ø  Even if D-cinema 40% of penetration, market would still produce more film than in 2002 !

Ø  Some recovery since Sept on both commercial and FF activities

Ø  Soft economy, SAG impact, € strenght, 2/3 perf conv … weight at least 70% of the situation.

Ø  Exhibition Ø  Technicolor 3D film - Kodak.

Ø  Production , Lab & Post Ø  More films to come ! Ø  Continue to implement labs where necessary : Ukraine Oct 09 Ø  Partnership Kodak – ARRI around degraining solution . Ø  Continue to push new formats : 35 mm 2 perf.

Dziękuję bardzo !

Thank you !

16