Eight talking points for the Europe and Middle East film industries in 2026

Getting audiences to watch European films

There is a growing concern in Europe of a disconnect between audiences and the film industry – and attempts to fix this will be a key focus for 2026. European feature production continues to rise, with around 1,800 fiction and documentary films produced in EU each year according to European Audiovisual Observatory. But getting audiences to see them is harder than ever; many European films programmed at festivals struggle to secure cinema distribution. It has led to growing calls for a greater share of European public investment, much of which is geared towards production, be used to support distribution and exhibition. The European Commission’s influential Media Industry Outlook recently warned that European film and TV industry needs to increase its focus on audience needs. It noted that greater production spending has not led to more success for EU content, pointing out that US content continues to attract the biggest audiences. Already there are signs of the European industry looking to adapt. Major European companies, like Studiocanal, Pathe, Beta, Mediawan and Gaumont are ramping up their focus on English-language content, in a bid to make content more broadly appealing. Genre filmmaking has moved up the agenda too. Many think the European Commission itself wants to foster big European companies that can compete effectively with US giants, rather than independent small and medium-sized enterprises (SMEs).

Backing comedies 

Thinking about audiences, comedy is the genre that really stands out in Europe right now. German audiences flocked to see Michael ‘Bully’ Herbig’s comedy sequel Manitou’s Canoe in 2025, which grossed €49m through distributor Constantin to end the year as the country’s number one movie. The 2025 Italian box office, meanwhile, was topped by Checco Zalone’s blockbuster comedy hit Buen Camino which grossed €36m in just seven days after its December 25 release through Medusa. Spain and France’s top-grossing local films were both comedies too: Father There Is Only One 5 and God Save The Tuches, respectively. Traditionally, European comedies rarely travel outside their home borders. But for a European industry looking to lure back audiences, it seems comedy is the genre to focus on.

The rise and rise of the Middle East

Confirming the rise of the Middle East and North Africa as a cinematic force, a record four films from the region have been shortlisted for the Best International Feature Film category at the upcoming 98th Academy Awards: Iraq’s The President’s Cake, Jordan’s All That’s Left of You, Palestine’s Palestine 36 and Tunisia’s The Voice of Hind Rajab. The figure rises to five if Jafar Panahi’s It Was Just An Accident, which filmed in Iran but is France’s entry, is included. Both creatively and financially, the region is stamping its mark on world cinema, and this only looks set to continue in 2026. Saudi Arabia and Qatar, in particular, have emerged as key players, through initiatives such as Red Sea Film Foundation and the Doha Film Festival as well as generous filming incentives. Paramount Skydance’s hostile takeover bid for Warner Bros Discovery is backed by sovereign wealth funds from the Saudi Arabia, Qatar and the United Arab Emirates.

Looking beyond Creative Europe

For many European film industry lobby groups, a key focus this year is negotiations around the proposed AgoraEU programme which will replace Creative Europe for the 2028-24 period. The European Commission has earmarked an ostensibly generous €3.2bn for AgoraEU’s newly designed Media+ strand, more than double the €1.44bn budget of the current Creative Europe Media programme, the key funding mechanism for the film sector. But the industry is worried that the Media+ funding scope has increased dramatically, with a particular focus on shoring up the struggling news media. There’s a strong political appetite within the EU to support efforts to counter disinformation and fake news, and the film and AV sector could be risk of losing support when the negotiations go to the wire.

Playing catch-up with US and Chinese tech

Europeans will continue to wrestle with an ongoing dilemma – how to prevent falling further behind the US and Chinese tech sectors. There’s widespread concern within the European Commission that non-EU companies have an effective control over distribution via platforms such as YouTube, SVoDs and social media, meaning that significant revenues flow out of Europe. Traditional mediums such as television remain prominent but are gradually being replaced by these digital offerings which carry less European content. Netflix’s proposed acquisition of Warner Bros Discovery would only add to challenges. Meanwhile, Europe also lags in the artificial intelligence race. Even though the continent can generate the ideas and talent needed to build new AI apps, it rarely becomes the place where those ideas scale. In 2024, the US produced 40 “notable AI models,” compared to 15 in China and just three in Europe, according to the 2025 Artificial Intelligence Index Report from Stanford University.

Can France’s box office bounce back?

Europe’s biggest film market, France had a rough box office year in 2025 ended with a total of 156.8 million admissions, down 13.6%. The figures are worrisome for not only the country’s struggling distribution sector, but the entire industry since the country’s long-revered film financing system is uniquely and intricately tied to theatrical ticket sales through its redistributive tax system. For now, though, local industry insiders say it’s too early to declare a state of emergency. Major companies have made big moves that illustrate a commitment to the future of theatrical distribution in the territory – namely, Studio TF1 starting to release its own films directly in cinemas this year, and media giant Canal+ acquiring a majority stake to take over longtime chain UGC by 2028. Plus, the line-up for 2026 looks robust with a series of event films rolling out throughout the calendar year already exciting local exhibitors like The Odyssey, Disclosure Day and Toy Story 5 from the US as well as buzzy French films Marsupilami, a two-part De Gaulle biopic, Fred Cavayé’s Les Misérables and Laszlo Nemes’ Moulin.

Germany drags its feet on investment obligation

The German production industry has had a rough few years, hit by broadcaster and streamer cuts as well as rising costs. It has struggled to compete internationally too, with productions lured to countries such as Hungary and the UK. So, the German film industry will be hoping that interminable discussions about the introduction of streamer investment obligations finally become reality in 2026. While at least 16 European countries have introduced their own obligations on streamers, Germany continues to drag its feet. Just before Christmas, German culture minister Wolfram Weimer announced that he had secured a voluntary commitment from international and local German streaming and VoD services to invest a total of €15bn in German production over the next five years, as an alternative to binding legislation. But the prospect of a voluntary commitment has not been well received by Germany’s producers’ body, the Produktionsallianz, which has long campaigned for an investment obligation. It argues that voluntary commitments would raise half the money of a statutory deal. A reported 30 industry associations have now signed an appeal for a statutory investment obligation with rights retention.

French funding fears

France’s film financing system, centred around the CNC, has long been admired for its ability to fund movies of multiple budgets and genres, particularly allowing first-time filmmakers and more ‘fragile’ less commercial films to exist. The country produces more than 200 films per year. However, funding sources are increasingly being threatened from multiple angles, and there are industry fears that the films that will suffer most are mid-budget films (namely in the €4-6m range). Last year, Canal+ said it was cutting its investment in local film production over the next three years from more than €600m between 2022-2024 to €480m. Meanwhile, France Televisions had its budget slashed by the government by €65m for 2026 which will mean giant cuts to its audio-visual creation and the international co-productions it finances. As in other European territories, politics are also at play as regional aid – key to financing lower and middle-budget films in particular – is increasingly vulnerable to shifts in local legislation and financing decisions. A far-right politician also recently proposed completely shutting down the CNC, which has raised alarm bells across the industry and forced CNC president Gaetan Bruel and local organisations to defend the country’s model. For now, no French revolution is upon us, but producers are heading into the year with an apprehensive mood.