Nuno Bernardo: Financing Transmedia

I recently did a presentation at the Power to the Pixel event in London about the subject of Financing Transmedia. When Liz Rosenthal invited me to be part of her line up, she asked me if I could talk about the different business models I’ve been applying to my cross-media and multi-platform productions in the last decade. At the time I agreed but after finishing the call I had doubts that I was the right person to talk about this subject. After all, I’m not a financier.

When, a few days before the conference, I was preparing my presentation and putting down the one or two things I knew about business models we used to fund our previous transmedia productions, I realised that the business model for transmedia is the same as it ever was for content: your audience pays for your content, or you give it away for free and get your revenue from advertising. It’s the same model for TV, cinema, newspapers and probably for all types of media.

So, if that is true, why do producers keep saying that there is still no business model in transmedia (and other forms of digital online content)?

The answer is: the problem is not the business model, or the possibility of producers making money on their digital content experiments, but on the funding model associated with transmedia content. TV and film producers are used to getting funding from broadcasters (or networks) or film boards and film public bodies, combining that money with probably some sort of tax credit and an advance from a distributor. That is the funding model established a long time ago, and the base of thousands of TV and film productions made in the last few decades.

The notion that transmedia doesn’t have a business model comes from the fact that there’s still no template to fund this type of production. Broadcasters that commission transmedia or online projects are still rare. There are few film and public bodies that have funding for these type of projects, the tax incentives still do not apply to transmedia or digital productions (except in Canada) and the few distributors operating in this arena don’t usually provide MG to producers.

The problem is that the distribution platforms like iTunes, YouTube, Hulu or Facebook allow producers to connect with a big and global audience but they don’t “commission” content in the same way broadcasters do for TV. This makes funding a transmedia project something very difficult and dependent on the creativity of the producer in finding the money in less usual places.

To most producers, embracing transmedia on their traditional TV or film productions usually means more work and less money. For producers that are starting out, it’s even more difficult to finance the development and incubation of a transmedia property when you don’t have a film or a TV series attached.

Traditional audiovisual funds are focused on TV or film. So where’s the money in this new digital world? What’s the business model and how can a producer finance the development of a Transmedia property? Who’s funding web series, games, apps, comic books, community management, augmented reality tools and all the new shiny tools available for audience engagement?

In the past, at beActive, we’ve been successful in attracting R&D and seed funding from National and European institutions. We are still living in the first days of Transmedia so most of the projects are more experimental projects than projects that follow an established language or structure such as Cinema or TV. So why not get some of the millions of euros available all over Europe that are being used R&D on the IT and software industry?

For producers approaching these R&D funders it can be daunting. Firstly, there’s the language. These funds don’t understand script, 3-act structures and character motivations. They understand deliveries, platforms, bits and bytes. So producers are recommended to learn their language. A pilot is not a pilot anymore, but a prototype. Script is not script but a specification document and marketing is dissemination of results.

Understanding this world will enable producers to attract funding from non-typical sources that will allow them to produce not only the audiovisual content of their transmedia project, but also websites, games, applications and to establish and market an online community. This successful R&D process will provide producers with a pilot, an online community, a growing brand and the basis for crossing the project to more traditional platforms as TV or Film.

As a final note, news was published recently that shows that the online platforms are investing big dollars in “commissioning” online content. YouTube just announced that it is commissioning 100 million dollars worth of content (providing advances over advertising revenues) to a group of 100 producers, including some established TV and film producers. As more platforms start to commission content more funding possibilities will be available to producers; and then the notion in the market will be that transmedia is starting to have a business model.

Nuno Bernardo is the co-founder and CEO of transmedia production company beActive. He is also the author of a book, The Producer’s Guide to Transmedia. He spoke recently at MIPJunior’s “Teen Market at the Heart of Transmedia’s Explosion”, our liveblog of which was the most-shared of all October’s live MIP coverage. Find Nuno on Twitter here, and Facebook here!