Interview with Stefano Massenzi, Head of acquisitions of Lucky Red, Italy

By Jesús Silva


Stefano Massenzi, Head of acquisitions of Italy’s Lucky Red and co-President of Europa Distribution’s Board, walks us through the complexities of the Italian market and the role of independent distributors in the circulation of European films. Italy was one of the few countries to launch specific support for the audiovisual sector during the Covid-19 pandemic, including increased tax credits for local productions and compensations for distributors and exhibitors.


How would you describe Lucky Red’s line-up and editorial policy?

Lucky Red was established in 1987 as an arthouse company, and over the years it has developed into the crossover and mainstream segments, becoming a very well-established player in the market. We have been the first independent distributor in Italy for many years now, but we still care very much about quality. An idea of quality which is peculiar, and applies not only to author films but also to genre and animation titles. Even when we are dealing with more commercial films, we always work with the top of the line. We distributed titles like Den of Thieves (Christian Gudegast, 2018), which was a great director-driven action film with Gerard Butler, and Portrait of a Lady on Fire (Céline Sciamma, 2019), two extremes, of course, but with a strong idea of cinema in both cases. We worked with many authors like Ken Loach, Haneke, Woody Allen… I would say we have a variety of films in our line-up, which has evolved throughout the years to fit the changes of our times. The model is always changing. We are not selling potatoes, we are dealing with films, so we need to adapt to the situation, the audience taste, the needs of the market and the broadcasters. Especially operating in a large country, where the theatrical model is not enough because the cost of promotion is extremely high, so the value of these titles for television and platforms becomes a substantial part of our business.


What are your other lines of work apart from distribution?

We have been active in co-production for more than 20 years. We have co-produced many European films, such as The Sea Inside (Alejandro Amenábar, 2004), which won the Oscar for Best Foreign Language Film; The White Ribbon (Michael Haneke, 2009), which won the Palme d’Or at Cannes; The Magdalene Sisters (Peter Mullan, 2002), which won in Venice; we co-produced Il Divo (2008) and This Must be the Place (2011) by Paolo Sorrentino, among others… Beyond production, we also have a share in the leading arthouse theatre circuit in Italy, called Circuito Cinema, which has venues in Rome and Florence, and programs theatres throughout the country.

On top of that, when we started to be more involved in production, we soon felt that the international sales arena in Italy was rather weak, so we decided to open, together with Indigo Film, a sales company called True Colours. The idea was to fulfil the need for exploiting our Italian titles, that many times didn’t get to travel that well, particularly if they were not the obvious authors. Nowadays, True Colours is the largest sales agent in Italy. We managed to create a lot of value and to support the circulation of Italian films throughout the world. It is also worth mentioning that, after 6 years, Lucky Red and Indigo Film are just two clients of the company, not even the biggest ones. We work with everybody in Italy, while competing with other European sales agents like French or German companies.


What are the main challenges of the Italian market when it comes to the distribution of independent films?

Italy is a large market, which needs important investments, and therefore we are more selective than others. If you don’t make it theatrically, which of course is a tough market, it is still very hard to recover elsewhere. At the same time, our capacity to sell films to TV is limited, because the editorial line of these titles needs to fit the editorial line of the broadcasters, meaning the more niche content usually doesn’t find a home. Even if I have a film that won in Berlin, if it isn’t successful theatrically, I don’t know who to sell it afterwards. Free-TV and pay-TV won’t be so welcoming because that kind of product doesn’t attract many viewers. That’s the main problem we have. Then, of course, access to the screens is always an issue, because you are competing in the same market with the majors. It is definitely not a balanced market. In 2019, Warner and Disney had 48% of the market share, just between the two companies.

Another interesting thing about the Italian market, like the Spanish or the French, is that we dub our films. I always say dubbing is a mean of democracy, because it makes a German or a Korean film speak Italian, so it is very helpful in terms of overcoming the language barrier. I would say we have quite a healthy market in terms of arthouse cinema, but we are not very ‘arty’.


Have you noticed any particular trend among Italian audiences?

The average age for the arthouse audience is quite high, which is also a concern for the future. We have been trying to make our decision-makers, both at local and European level, understand that education is key here. We have to protect the most fragile part of our business, which is the arthouse segment. For that, we need to “alphabetise” the audience through film education. We spend a lot of time consuming audiovisual products, it is a big part of our lives, so it would be very important to have some guidance to navigate all that content. This could be part of the education system, like we do with history, geography, art, music… In that sense, I think companies like ours have a cultural role to play.


Could you elaborate on that? What do you think is the role of a film publisher and the added value it brings to the market?

I always say we are like ‘chefs’. The producers provide us with wonderful products, but we need to put all the ingredients together. The film is the main ingredient, but not the only one. If you think of a plate of pasta, the pasta is the main ingredient, but not the only one. You can have fantastic pasta but also get it wrong. That is why the concept of publisher or curator fits better what we do. First, we source the material that is more suitable, and then we build a line-up. This line-up is very sensitive to the timing. The same film can’t go out throughout Europe at the same time, because there is competition both with Hollywood films and with local productions. Even when you have a ‘European champion’, a title that won Cannes, Venice or Berlin, if there is a local film that is very important to that market, you have to go around it. That’s the first choice you have to make as a publisher.

Then you take on the role of a creator, producing all the artwork. Most of the time, we create the poster, the trailer and other materials because we need to adapt them to our local market. Hollywood films are usually aimed at the global audience, so they have a coherent campaign in the different territories. Meanwhile, most arthouse films are local titles that appeal to a local audience, so the original material is not coherent with the culture of the country where you’re going. Many times you don’t have actors that people recognise. You don’t have cultural references, so you have to translate that into interest from your local audience. That’s the key to success, and that is what we do. We create the buzz, we create the possibility for these films to be successful in our countries. Sometimes we manage, many times we don’t.


Let’s focus on the success cases then. Can you remember any campaign for a European film that worked particularly well? What was the secret ingredient?

I’ll give you an example of a film that is not European, but focuses on a European character: At Eternity’s Gate (Julian Schnabel, 2018), the biopic about Vincent van Gogh. A few weeks before the release, we decided to invest more money in the campaign because the awareness of the audience was so high that we needed to exploit it. The film premiered in Venice, where Willem Dafoe won the Coppa Volpi for Best Actor. While working on this title, we discovered that Van Gogh is a superstar artist in Italy. For some reason, we even managed to reach younger audiences. It had become an event-movie, which is key nowadays. The film didn’t work that well anywhere else, except in Italy, where it made 650,000 admissions.

Another example was Borg McEnroe (Janus Metz Pedersen, 2017), the film about the rivalry between tennis players Björn Borg and John McEnroe. We had the first result in the world with that film: around 300,000 admissions. It premiered at the Rome Film Festival, where it won the People’s Choice Award, so this was really important. On top of that, Rome is considered the city of tennis in Italy, because of the international championship, and both players were extremely popular here. Eventually, all these peculiarities made a Swedish film very successful in our country. Of course, we also launched a marketing campaign that worked really well, involving the biggest sports newspapers in the country, as well as ambassadors that promoted the film on social media.


What is the usual repartition of income for your films in terms of windows?

Generally speaking, I would say 50% would come from theatrical. As for the remaining, pay-TV and free-TV hold the biggest share, while TVOD and DVD play a very small role. TVOD has never been strong in Italy, and it didn’t manage to replace DVD, mainly because of piracy and windowing reasons. We’ve always had a very high level of piracy, which has never been seriously addressed. When theatres cut off a film, it becomes only available on pirate sites, until you can exploit it through other windows. In Italy, the holdback for theatrical is usually 105 days, so by the time you get there, people have forgotten. SVOD is the predominant model nowadays, together with pay-TV. As for free-TV, the pricing has been going downhill for many years. Some years ago, a film could do 20-25% of rating on TV, but now you are lucky if it makes 10%. The film arrives on TV after all the other exploitations, so people have seen it already.


Have you noticed any other trend related to the growth of the platforms?

The platforms have brought some changes, especially in terms of the availability of the products. When competition for the acquisition of titles moves into an area where your competitor is a major company or a platform, the situation becomes problematic. If you think about films by established directors, like Sofia Coppola’s last effort, On the Rocks (2020), which went directly on Apple TV, it definitely affects the theatrical market. Despite being with an independent or a major distributor, if that film was in the theatrical arena it would have made a significant number of admissions throughout the world. Lacking that kind of product is of course one of the problems that we are facing and will continue to face in the future. It happened already with Scorsese’s The Irishman (2019) or with Roma (Alfonso Cuarón, 2018). These cases weaken the theatrical model and our core business.


Concerning the effects of the Covid-19 pandemic, what measures were adopted in Italy to help distributors overcome the impact of the crisis?

In the beginning, there were basically two big measures for the audiovisual industry, aimed at exhibitors and producers. Exhibitors received a percentage of funding based on their business from the previous year. Producers got support for the extra expenses related to the complexity of shooting during the pandemic. The tax credit on Italian productions went from 30 to 40%, both for last year and for 2021, which is very good news. That is why Italy was one of the first countries in the world to reopen production, and the level has been very high. Companies have been shooting all summer. Everybody is producing, because there is also a strong request from the platforms. They don’t have new American titles, and everyone is afraid about what will happen towards the second half of this year, when the wave of non-production in the US will hit.

In this situation, distributors asked: “what about us?” We lost money releasing films, we lost money while being shut down, selling films at a lower price… So, we made a proposition to the Ministry of Culture which has recently been published. It’s basically a point system: for every € 10,000 P&A and box office you get points (different points for nationality – Italian films do not get points on P&A as there is a tax credit – more points neared to lockdown), all distributors apply, then you divide the budget allocated of € 25M by the sum of the points for all the films for all the distributors, and you have the value per point; by multiplying the point value x points per distributor you have your support.



What other measures are you fighting for at the moment, both on a local and European level?

In 2021, Italian films will have an increased tax credit for distribution. Normally, it was 30%, but now it will go up to 80% during the first four months and 60% afterwards. We are also working on a huge campaign that will be financed by the Ministry of Culture for the reopening of theatres. The idea is to create a favourable atmosphere for people to go back to the theatres. It will be a substantial investment.

On a European level, it has been more complex. Unfortunately, Covid-19 happened during the last year of the former MEDIA programme, which finished on 31 December. Now they are still in discussions for the new one, so it won’t be very effective for the relaunch of the market. They have sped up payments that were due, which was very useful, but in terms of actual policies, it is still a little shy. Having less support and more uncertainty will of course have its impact on the circulation of European films. The sooner we know what’s going to happen, the better for everyone. We have been asking for stronger support in 2021, because it is needed. When you have so much production you also need a pretty substantial aid to distribution. Otherwise, it doesn’t make sense.


On a more personal note. What brought you to film distribution in the first place? What does your day look like, and how do you see the future?

I studied Economics, but I always had a passion for cinema. Instead of becoming an accountant, I decided to buy, sell and finance films. I still take care about money, but there is also the creative part about selecting films, which gives me great satisfaction.

My day varies a lot. Something special about this business is that every film is new. You start from scratch. You don’t repeat yourself because every film is different in many ways, and even if you want to make it simpler and create some kind of homogeneity in what you do, it never happens like that.

Regarding the future, I believe that people have proved that as soon as lockdown is over, they want to be together. And going to the theatre is being together. I believe the cinematic experience will survive. It has been there for over 100 years, undergoing many things: the change from silent to sound cinema, from black and white to colour, the popularisation of TV, the rise and fall of DVD, the platforms, … But cinemas have always been there. The arthouse market didn’t exist in Italy 30 years ago. It was just Hollywood and local productions. And then independents came along, and the options expanded. I think the capability to choose is the greatest richness we have as consumers, as citizens and as human beings.