The deal means that while more UK films will be made, they may take longer to appear on terrestrial television, adding perhaps another year to the approximate 18-month delay between cinema screening, video release, and television. Channel 4, which invests pounds 10m a year in new films for 'Film on 4' is potentially most affected.
Film rights are also expected to cost television companies more in the long term. Until now, the two main BSkyB film channels, Sky Movies and the Movie Channel, have relied on deals with the big US studios - a policy that attracted criticism for failing to put anything back into domestic television and film-making.
David Elstein, BSkyB's director of programmes, said: 'We don't want any creative control of films we license. We are like the cinema owners; pay television is one more point of distribution.'
The deal has been driven through only after a bitter dispute within the industry. Initially, Michael Grade, chief executive of Channel 4, tried to stop it. The Department of National Heritage was called in, but film producers swung the day by supporting the BSkyB move.
The new money is being channelled through British Screen, the main supporter of commercial film production in the UK. It currently has a maximum budget of pounds 6m a year and has backed such films as The Crying Game, Orlando, Damage, and Naked.
Channel 4 is also a 42 per cent shareholder in British Screen. Until now it has, in effect, stopped pay channels exploiting the films it backed, by buying out all rights. Under the new deal Channel 4 will only be able to pre-empt a satellite screening and ensure a terrestrial premiere by putting up one-third of a new film's budget.Reuse content