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The booming market of the animation industry

By Platform

Animation is a booming market within the broader audio-visual industry but has some specific characteristics, which makes it relevant from a regional economic development perspective.

Differently from other visual content production, animation projects tend to employ large teams – often 60 to 120 full-time equivalent - over a period of typically two to three years for a production. The combination of the use of advanced technologies, the need for highly skilled workers and research and development activities give animation an industrial character and provides opportunity to set up local animation studios with global visibility and significant growth and highly qualified job creation potential. It becomes thereby a structuring sector for the local audio-visual industry, which makes it attractive from an economic development perspective.

Several animation studios capable of competing in the global marketplace have emerged in Europe. The relevance and potential of the animation sector has been set out by the European Animation Plan launched on 12 September 2017 whose priorities have inspired the new Creative Europe MEDIA programme (2021-2027). 

Challenges and Need for Funding

The impact of the Covid-19 pandemic showed that animation is a resilient sector. Contrary to live action works, which proved difficult to produce, animation studios were able to continue working. However, as highlighted by Mrs. Lucia Recalde (Deputy Director and Head of Unit Audiovisual Industry and media support programmes DG Connect, Responsible for Creative Europe MEDIA and multimedia support services) in an interview with Flore de Bayser (Wallimage, Lead Partner of ALICE):

Covid has fragilized the industry. There is a need to inject liquidity in the industry, to help it recover and to help it transform, i.e make it greener, more digital and connect with the audience. […]  The animation industry is already particularly innovative. Animation is where you can actually link tech industry and the content industry. This bridging between content and technology is absolutely essential for the future.

The pace of innovation is high in the sector. Digitization and changing consumption habits (using tablets, smartphones, internet, mobile and web applications) have massively disrupted the market and the way audiences (especially youth) consume content. In order to remain innovative and competitive, and for the studios to be able to keep their talents, the sector needs funding that will help develop new projects that will keep their teams busy between productions and retain their best professionals in a globalized market characterized by a high mobility of talent.

Those are some of the challenges tackled by the Interreg Europe project ALICE Animation League for Increased Cooperation in Europe.

Several good practices published by ALICE illustrate the specific needs for funding in the animation sector:

  • Wallimage (Wallonia, Belgium): in addition to a traditional funding support to audio-visual projects, Wallonia's film fund Wallimage has provided support to regional audio-visual companies since 2008. This funding is intended to structure the local industry while helping production and post-production businesses develop, innovate and accelerate their growth. Initially dedicated to film companies and animation studios, the Walloon fund has gradually broadened the scope of its actions to include new media and gaming companies. Financial participations are provided either in the form of equity investments (acquisition of a minority stake in the capital of a company) or in the form of loans. Wallimage benefitted from the Cultural and Creative Sectors Guarantee Facility (CCS GF) of the European Investment Fund (EIF).
  • Pictanovo’s development fund (Hauts de France, France), a French regional fund, launched the Editorial Writing and Development program to support companies upstream of the production of audio-visual works, which is the most uncertain phase, as well as the most difficult to finance. This fund helps providing a medium-term vision of companies’ activities and support for the simultaneous development of a slate of audio-visual works, including animation.
  • A Funding Programme for Animated Projects (Catalonia, Spain): This is a funding programme specifically dedicated to animation audio-visual productions implemented by the Catalan Institute for Cultural Companies (ICEC) with criteria adapted to the specificities of the animation production process and timeline.

All three initiatives have been able to contribute to the growth of their respective regional animation sector.

Policy improvement in Puglia Region inspired by the ALICE partners

The specific knowledge and expertise available within the ALICE partnership enabled the representatives of the Department for Tourism, Economy of Culture and Valorisation of the Apulia Region (Italy) to promote and boost their activities of improving the access to funding for regional businesses in the animation sector.

A need for more funding for the operators working in such a specialised sector like the animation had been identified early in the project by the Apulian local stakeholders. Also, ALICE meetings have pushed policy makers to consider and treat the animation sector differently from the general audio-visual sector in terms of tenders, with ad-hoc rules specifically tailored on its characteristics.

As a result of the activities in ALICE, a specific funding category for the first time in Apulia was devoted entirely to the animation sector in the framework of the new Apulia Film Fund 2020, launched by the Apulia Film Commission Foundation, an in-house company of Apulia Region. The Apulia Film Fund 2020 is funded by the Regional Operational Programme ERDF/ESF Puglia 2014/2020 and provides support for businesses in the animation sector starting from a minimum of € 300.000 up to a maximum of € 700.000. Another funding vehicle, the Short & Digital Production Fund was also partly dedicated to the animation sector.

ALICE’s six members spent the past two years studying the animation sector in depth, in close collaboration with local industry stakeholders. Together, they have built proposals to develop skills and talent, support the creation of strong intellectual property and improve access to co-production funding. Their tools and recommendations are all compiled in a white paper, released in November and now available for download.

Dowload ALICE's Whitepaper here

Image credit: LightFieldStudios on Envato elements.