France orders streaming services to reinvest in local content

The French government has decreed that Netflix, Disney+ and other streaming services will have to spend up to a quarter of their French revenue on making local content. Eighty percent of each platform's respective investment will go toward making French shows, TV movies and documentaries (more Emily in Paris and Lupin, anyone?). The remaining fifth — four or five percent of their total French revenue — will be used to make theatrically released movies.

The country is the first European Union member to enforce new streaming rules under the European Commission's Audiovisual Media Services Directive. The framework is designed to create more parity between streaming platforms and other broadcasters and entertainment services across the EU.

Until now, streaming platforms have been prohibited from adding any theatrically released movie to their French libraries until three years after the film hit cinemas in the country. If the services spend a quarter of their French revenue on local content, they'll have access to films within 12 months of their release dates. If they opt for the minimum investment of 20 percent, they'll need to wait at least a year before adding theatrical releases.

So, there's an incentive for platforms to invest the full 25 percent of revenue. Disney+, for instance, might be tempted to go down that route so it can stream the likes of Marvel, Star Wars and Pixar movies much sooner in France.

Netflix is planning to reinvest 20 percent of its French revenue in local content, according to Variety. It's hoping to lock down a 12-month window for theatrical movies. The company hasn't shown its movies at the Cannes Film Festival for years, partly because of the three-year cinema rule.

The EU has been working for years to ensure streaming platforms have a significant proportion of local content in their libraries. Other jurisdictions have been attempting to make streaming services invest in local productions as well.

The Canadian government, for instance, is looking to reclassify streaming companies, which could require them to contribute hundreds of millions of dollars toward making local content. In 2017, Netflix committed to spending $400 million on Canadian productions over five years.