Local comedies Dreamship Surprise - Period 1, DerWixxer and 7 Dwarfs drove soaring admissions in 2004. German audiencesalso responded well to the more idiosyncratic titles including OliverHirschbiegel's The Downfall,Fatih Akin's Golden Bear winner Head-On, and the family film Lauras Stern.

In the first nine months of the year, German films'market share climbed year-on-year from 14% to 21%. Total admissions areexpected to return to the level of 2002. The local industry's confidencewas also given a welcome boost when Hans Weingartner's The Edukators screened in Competition at Cannes, the first time aGerman film has done so for 11 years.

Overheard this year

'People have financed films which didn'tinterest them - and our Ministry of Finance granted them tax advantagesfor this. The effect for the German film industry was nil.' ChristinaWeiss, state minister for culture on German private equity flowing to Hollywoodvia the private tax funds.

'Everybody can bring their laptops, but theywon't have to screen on their laptops. We are not at that stage!'Berlinale director Dieter Kosslick on the concern over capacity at the upcomingEuropean Film Market.

'We want to make Babelsberg Studios fit for the futureso that, in 10, 20 and 50 years' time, it is still a living myth and nota dead legend.' New studio owners Carl Woebcken and Christoph Fisser.

Breakthrough talent

Marc Forster, the German-born director living in the US,solidified his reputation from Monster's Ball with Finding Neverland, which has been named best picture by the NationalBoard of Review. At November's AFM, buyers got worked up byForster's new comedy project, Stranger Than Fiction, starring Will Ferrell, which is being handled bySenator International.

The year ahead

'After the success of The Downfall my fear is that the dictatorship theme will set atrend for international film subjects. The Golden Globes, Oscars and EuropeanFilm Awards will have then to create a new award category of 'bestdictator'.' Dieter Kosslick, festival director, Berlinale.

'I hope Germany can acquire a position as aco-producing international territory. I think we need more financialinstruments to bring us to par with the competition, such as with theUK's sale-and-leaseback model. My biggest fear is that the regionalinterests will actually threaten film financing. The stories can be regional,but the films must be financed internationally. If the regional interests comeinto conflict with this, we will become second rate.' Sytze van der Laan,CEO at Studio Hamburg Produktion.

Box office snapshot

Highest-grossing film: (T)Raumschiff Surprise -Period 1 (Constantin Film) $68m

Highest-grossing international film: HarryPotter Azkaban (WB) $48.1m

Highest-grossing arthouse film: Lost In Translation (Constantin Film) $8.24m