The future of Graz's Diagonale festival under the new management of Miroljub Vuckovic and Tillmann Fuchs has been dealt another blow with the news that Graz's city council has decided to also provide funding for the rival event being planned by the filmmaking community (ScreenDaily.com, 29 Oct).

According to the Austrian daily newspaper Kleine Zeitung, an alliance of the Social Democrats, Communists and the Greens, who have a majority in Graz's city council, have succeeded in pushing through a motion charging the local authority to "undertake all efforts to enable the real Diagonale to come about."

Consequently, the "old" Diagonale and the alternative event are likely to have to share the Euros 200,000 support which the city had made available until now, with each festival receiving Euros 100,000.

Speaking to Der Standard, Alexander Dumreicher-Ivanceanu, coordinator of the "We are the Diagonale" initiative, commented that the councillors' decision was "a very nice surprise, a positive signal to the directors and filmmakers".

He also told ScreenDaily.com that press conferences would be held in Graz and Vienna at the end of this week to unveil the concept for an alternative three-day event which has already won the support of such leading Austrian filmmakers as Michael Haneke, Barbara Albert and Ulrich Seidl (ScreenDaily.com, 29 Oct).

Meanwhile, Gerhard Schedl, the outgoing chief executive of the Austrian Film Institute, has joined the debate on the Diagonale by suggesting that it might make more sense to forgo holding the festival at all next year. In an interview with Der Standard, he argued that it would no longer be possible to organise a Diagonale "in the intended form" for March 2004. "The time is short, and the situation is completely muddled. I propose instead to contemplate a festival which is really supported by everyone again in 2005."

Schedl added that the recent roundtable between the producers association and other film industry groups to discuss their strategy with regard to the Diagonale had been "one of the most unpleasant experiences I have had for a long time: the positions are completely hardened."