David Ellender, media executive and former global CEO of FremantleMedia, moderated this panel on how to fish out new financing models in the transmedia world. The panel included Médiametrie‘s head of international TV research Amandine Cassi, Tre Vänner executive producer Michael Hjorth, Bavaria Fernsehproduktion‘s head of coproduction and financing Philipp Kreuzer; and ING Bank head of media finance David Grover.
Cassi began by providing a few basic statistics from Mediametrie’s Eurodata TV Worldwide tool, which covers 100 territories and 5,500 channels.
Globally, local output takes centre stage: the top programmes in 2012 were 77% local (the breakdown of programmes by genre was 21% factual, 41% entertainment, and 38% fiction).
To illustrate the impact of local series, note that most comedies tend to be local. In Denmark, 10% of primetime series are local and stand for 45% of the series watched during that timeslot.
A-list talent also remains a reliable way to win viewership, and is considered a safe bet for advertisers. Mediametrie synopsised its findings thus:
– Traditional TV is still growing in the connected content era
– TV is still the place to be for engaging experiences
– Local content is king
– Local success leads to worldwide recognition
– A-list talent and bold dramas pay off
– Traditional key players can yield big opportunities
Tre Vänner’s Hjorth took the stage next, providing a list of challenges that the industry must address:
– A lack of uniformity of formats (i.e. 30 minutes, 90 minutes and everything in-between)
– Closed vs open-ended episodes (one-off procedurals or open-endeds, to which the world is trending and in which you can really track viewers)
– The digital revolution
Hjorth said the most striking thing for him this market was that, of the content he’s representing on the deal-making floor this year, not one is based on a book.
He also pointed to pressures to improve quality while lowering overhead. “The quality has to increase whereas the money… is probably going to be less,” he said. “Which means that we have to find more partners, because more people need to pay for that.”
Kreuzer followed with more optimistic news: “Worldwide TV audiences have never been so high, with daily viewing time increasing.” He also points to all the MORE! out there: there are now more TV sets, more distribution, more channels, more non-linear availability of content, and more overall better content — all driving TV consumption.
“The digital ecosystem is having a positive effect on TV use and audiences in general,” he preached, and also pointed back to the power of partnership. “Germany is one of the biggest financers of Scandinavian series… and it’s really brought European fiction production forward, enabling us and (broadcasters) to take bigger risks.”
And because there are more pay-TV and VOD platforms (including Netflix, Hulu and Amazon), demand for original content has also grown. More diversification of choice leads to higher demand for programming, which creates audience loyalties, Kreuzer argued.
High-end fiction and series pleases audiences and creates appetite for more, he went on, but “broadcasters do need to leverage risks as budgets get tighter.” He emphasised the importance of securing partners and finding new revenue streams, especially for second-screen.
“We have to be more flexible in structuring our financing deals,” he concluded.
Grover kicked off his talk with a pretty powerful statement: “I think producers are in the power seat to take advantage of a very strong strategic position in digital rights. And you’re not doing it.” The window is small, he cautioned; customers will soon be tougher on them.
And while he agrees with Kreuzer that digital has an overall positive effect on TV, his clients are very nervous about it.
However, he talked about digital as an enormous opportunity to glean insights that serve producers and distributors over the long-term.
“You can project the revenues earned on content through digital based on viewing history,” said Grover, for example when a given Breaking Bad viewer purchases seasons 1-4 of the show on iTunes. Chances are high that they’ll buy season 5.
“So there are definitely some behaviours that can be quantified,” he pointed out. “This requires distributors to share data, and that’s one thing we have to try and convince (the Netflixes of the world) to do.”
But he encouraged attendees not to think of Netflix as the enemy. His clients often tell him “it’s actually often our buyer of last resort.”
He concluded by saying, “If we want to try financing the old model, we’re gonna lose. The only way to go is forward.”