What is the financial turnover of the home entertainment network and why is there a dispute over it?

The suspension of the series "Tasian" from the home entertainment network in Iran has once again increased criticisms regarding censorship and government oversight of artistic works. While audiences for government and state media productions have significantly dwindled in recent years, the home entertainment network has become a venue for artistic works with fewer red lines. Nevertheless, the regulatory bodies of the Islamic Republic can still halt productions that do not align with their preferences based on the law. The broadcast of the series Tasian, which is set in the historical context before the 1979 revolution in Iran, was also halted due to opposition from these same bodies. Although many governmental institutions, including the "Promotion of Virtue and Prevention of Vice Headquarters," government news agencies, and newspapers have criticized this series, the direct responsibility for its suspension lies with the Media Regulation Organization, "Satra," which is directly affiliated with the Islamic Republic's state media. Critics in the cinema and art fields have stated that the aim of halting the broadcast of series is "competition between state media and the home entertainment network" and this organization's attempt to prevent audience attrition and the transfer of viewers to private productions. In contrast, some criticize the "migration of suspicious funds" for money laundering in home entertainment productions. It is said that the heavy influx of suspicious funds in the form of increased salaries and the creation of costly projects in the home entertainment network has impacted the development and popularity of these networks. The Islamic Republic's government, faced with the global wave of popularity of internet streaming platforms, has been compelled to accept serious domestic competitors for state media while simultaneously imposing filtering. This situation, which has led to the migration of traditional television audiences to internet platforms, has brought about new challenges such as censorship and content control. In line with the expansion of internet television over the past decade, the Islamic Republic established the National Media Regulation Organization in 2015 to oversee the content of the home entertainment network. This organization, known as "Satra," is one of the bodies affiliated with state media and is also considered the main competitor of the home entertainment network. While the home entertainment network has become one of the most important pillars of the entertainment industry in Iran, state media, whose head is appointed by the Supreme Leader, continues to "compete" and "supervise" these networks. Before the establishment of Satra, the Ministry of Culture and Islamic Guidance was responsible for overseeing the visual media content legally, but a decree from the Supreme Cultural Revolution Council divided this responsibility between the Ministry and the body under the Supreme Leader. State media officials deny any "competition" or "conflict of interest" between Satra and the home entertainment network. Peyman Jebli, the head of state media, recently rejected any competition between the two, stating that Satra only oversees "the content of productions." Satra officials also describe the organization as "a governmental body" that is not in a position of competition. Saeed Maghiseh, the head of Satra, stated in 2023: "If state media were a competitor of the home entertainment network, it would not have granted production licenses for 60 television program or series titles since the beginning of 2022." According to him, "Competition exists when one private sector has equal rights with another, while state media is a governmental body." Despite this, prominent cinema figures and critics believe that the main intention behind Satra's imposition of preferences in private productions is to prevent "audience attrition." For instance, Masoud Farahani, a film critic, stated: "Censorship does not allow a respectable historical series to be shown to the public, lest the trash they have be unseen." The Iranian parliament has included oversight of state media over the home entertainment network in its seventh development plan. The rapid growth of the home entertainment network in recent years has made it one of the most important sectors of the media industry in Iran. In the late 2000s, packages labeled as series began to appear in supermarkets. The public's interest in these works and the illegal distribution of physical copies of series later gave way to online platforms. This transformation, coinciding with the public's growing interest in cyberspace and the penetration of the internet in Iran, has not only led to an increase in domestic productions and competition among various platforms but has also generated a massive financial turnover. While state media has faced a significant decrease in audience due to its governmental bias in productions, these platforms have managed to become suitable alternatives for the diverse tastes of society by lowering the level of red lines. This trend has been particularly reinforced after the nationwide protests of 2022 in Iran and the deepening divide between the people and the government. A market research institute in Iran has reported that the penetration rate of the home entertainment network in Iran has reached 13.6%. The "Taxlux" institute stated in this report that only one-third of the audience purchases legal subscriptions to these networks, while the rest download series illegally. In contrast, the "Growth Center," affiliated with the government Imam Sadiq University, published the results of a survey from a sample of 1,200 people claiming that the audience for some series of the home entertainment network has reached "three percent," contrary to advertisements. Assessments show that the income of some online streaming platforms exceeds 100 billion tomans per month; a figure that surpasses the budgets of many official cultural institutions in the country. According to Mohammad Hassan Khalatbari, the deputy for market regulation and business development at Satra, the financial turnover of the home entertainment network has reached 130 trillion tomans. Mohammad Hassan Shanesazadeh, a board member of Namava, also stated earlier this year that the cost of a typical series episode is "three billion" tomans, and each episode of the series "Sovushun" costs eight billion tomans. The high financial turnover and the influx of investors into the home entertainment sector last year have enabled this sector to have the upper hand in spending and financing large projects. Accordingly, financing, which was one of the main obstacles for private filmmakers and artists in competing with governmental productions, has been removed from their path. The proposed figures by producers in the home entertainment network in recent years have even surpassed the usual salaries in cinema; proposals that have led to the migration of famous actors and cinema stars to online platforms. The newspaper "Sharq" reported on March 5 that the average salary of a prominent actor in film projects is estimated at three to four billion tomans, which can be considered equivalent to the salary for "one or two months" of participation in a series project in the home entertainment network. Recently, the publication of the salary figures for the actors of the series "Azazil" directed by Hassan Fathi sparked much debate on social media. According to documents circulated on social media, the actors of this series receive monthly salaries ranging from one billion six hundred million tomans to three billion tomans. Many cinema critics and directors have criticized these payments, stating that raising the salaries of artists in the home entertainment network has harmed cinema and called for transparency regarding the sources of the vast sums in the series. Some evaluate the large payments as a means to create a monopoly for producers connected to security institutions and to eliminate independent investments in the Iranian film industry. An examination of the profitability model of the home entertainment series shows that the high costs for series do not have much economic justification. Since more than two-thirds of the audience of these networks do not pay subscription fees to watch content and download works illegally, it is not even possible to attribute the significant public interest to the direct income of these networks. Online platforms also generate income through advertising, but given that some series cost up to 20 billion tomans for producers, profitability through advertising revenue will also be very challenging. This is why some believe that in the home entertainment network, as in many cinematic and television productions, producers affiliated with the government or suspicious funds have a prominent presence; especially when most artistic productions in Iran have become loss-making and investment in markets like gold and currency is more attractive to investors. Although the financial growth of the home entertainment network has led to their prominent presence in Iran's entertainment industry, it has not been without controversy. This issue has been repeatedly raised by artists and even government-affiliated media and hardline factions. Kamal Tabrizi, a director, stated: "Some projects start; pre-production, contracts, payments, actors, scenes, etc., but suddenly stop, and the reason is unclear. I think one of the reasons might be money laundering." One of the biggest examples of money laundering in the private series industry in Iran was the case of the popular series "Shahrzad," which later became clear that a significant portion of its funding was obtained through the "Sarmayeh" bank and widespread financial corruption within that entity. This case revealed that the home cinema was also tainted by suspicious funds from government affiliates despite the presence of independent artists. Mohammad Emami, the producer of this series, was sentenced to 20 years in prison, restitution, and dismissal from government services for "major disruption in the economic system" during the corruption case of the "Sarmayeh" bank. Following that, allegations of money laundering regarding several other works of the home entertainment network, such as "Mahtiti" and "Shahgosht," were repeated. Subsequently, other investors like Hossein Hedayati, Ehsan Delaviz, and Mohammad Hadi Razavi, who had a history of investing in the home entertainment network, were arrested or convicted on financial charges. The relationship of the Iranian home entertainment network with the world is such that while internal restrictions and censorship have led to the formation of local streaming networks and several platforms in Iran, countries like Turkey and South Korea have generated billions of dollars annually through the export of series via American platforms. These countries have recently earned significant income from the entertainment industry using global platforms like "Netflix," "Amazon Prime," and "Apple TV." One of the biggest differences between Iran and countries like South Korea is the lack of access to global platforms for distribution and revenue generation. According to official statistics, Korean productions generated over $2.5 billion in revenue in 2023 alone through collaboration with Netflix. Series like "Squid Game" and "Hell" have quickly trended worldwide and become one of the achievements of this country in cultural diplomacy. "Netflix" alone allocated nearly $17 billion for content production in 2023, a figure that is by no means comparable to the total production costs in the Iranian home entertainment network. Additionally, these platforms have a wide influence by operating in over 190 countries and have transformed the entertainment industry. Amir Rahimzadeh, the head of the home entertainment investors' house, stated: "A day will come when we will no longer need to earn foreign currency from oil and petrochemicals. If proper and principled work is done in the audio and visual sector, it will yield over 80% profitability." Despite this, not only has the scope of Iran's entertainment industry not yet reached a global scale, but it also faces a significant barrier of censorship. Despite the brilliance of Iranian filmmakers at international festivals, the lack of access to international markets due to sanctions has hindered Iran's presence in the home entertainment industry.