A Match Made in Heaven

Format distributors large and small are looking at creative pacts as a smart, flexible way to develop ideas that will travel.

In the elusive quest for the next big global hit, format distributors are using a variety of methods to secure access to the best new ideas out there. For the last few years, consolidation seemed to be the go-to route, with the likes of Endemol, FremantleMedia, Banijay Group, Zodiak Media Group and ALL3MEDIA, among others, snapping up production houses—and their libraries—worldwide. For smaller boutique distributors, meanwhile, there have been plenty of committed independents to sign piecemeal third-party representation deals with.

In between those two extremes are a variety of partnerships that can involve equity, joint development, first-look pacts or output deals—or a hybrid of some or all of the above.

“Intellectual property is the fuel of all of our growth and therefore of our ambition,” says Gary Carter, the COO of FremantleMedia, which owns a broad network of production companies worldwide. “Creative allegiances with third parties are very much part of that strategy, so we are always looking to form relationships that would generate intellectual property for both sides’ benefit.”’

AN EXCHANGE OF IDEAS
“There is a gap if you continuously just develop for your own local needs and what your direct broadcaster clients immediately need,” notes Michael Schmidt, the group director of creative operations and business development at Red Arrow Entertainment Group on the need to sometimes look outside of your own network. “You do seem to have a harder time [finding] the big shots that travel the world instantly.”

FremantleMedia is no stranger to spotting and developing concepts that will translate well to multiple territories. Historically, the company’s library has been generated largely from Europe and North America, but among its most recent hits is a format that originated as a segment on a variety show in Japan.

“On the Internet we spotted a little fragment of people jumping through a wall and we tracked it back to [the Japanese broadcaster] Fuji Television Network and we redeveloped it as a single program that went on to become one of the world’s fastest-traveling formats,” Carter says. “Hole in the Wall has now been sold to more than 40 countries.” The show, Carter notes, “proved that it was possible to have a great deal of format success in the Asian region and then use that success as a springboard for Europe.”

On the heels of that experience, Carter says that FremantleMedia “believed that the time was right for more Japanese shows [to be available in the international marketplace] and that we could bring them to the world. I think our partners at Fuji also realized the enormous potential and indeed commercial benefits in transforming Japanese content into entertainment that appeals to the international market.”

The key, says Carter, was developing a new working relationship with Fuji that would go beyond a distribution alliance and leverage each of the companies’ strengths. “It’s a true exchange of creative talent,” Carter says of the pact.

In the first year of the relationship, a producer at Fuji, So Fujinuma, spent three months within FremantleMedia’s various global production offices, primarily in the Los Angeles base. “We then sent three different producers—one from Holland, one from Australia and one from Los Angeles—to Tokyo at different stages last year and they all worked on different programs,” Carter says.

The first title to emerge from the collaboration was Total Blackout, which was launched at MIPCOM 2010 with presales in three countries already secured. “It went to air with spectacular ratings and has since been among our most-traveled shows, launching in seven markets in the first half of this year alone,” Carter says. “So far it has been in Denmark, Belgium, Norway, the Netherlands, Sweden, Ukraine and Indonesia, it’s aired in Japan, and there are a significant number of upcoming launches on the way.”

TARGETING TALENT
A newer entrant to the format business, Red Arrow Entertainment Group—formed by ProSiebenSat.1 Media in 2010—has spent the last two years building a portfolio of wholly owned and joint-venture production outfits, while also lining up a string of deals with well-known producers in various strategic markets.

The willingness to team up with top-level talent is part of the DNA of the company, says Schmidt, noting that the alliance with the Dutch creator Dick de Rijk was in the works even as Red Arrow was in its infancy. At the time, the creator of Deal or No Deal had just ended his relationship with Endemol. The partnership with him would serve as a “cornerstone for the strategic development” of Red Arrow, Schmidt says.

“There are not that many creators in the world who can say they created a worldwide hit that still is contributing to Endemol. That spoke for itself, quite frankly. Dick is very creative; he has a very high output. [The deal with him] is about identifying the ideas that can work for the global market, [while] also helping us as a group to grow and further the capabilities of our producers.”

Red Arrow and its distribution arm, SevenOne International, have already seen the benefits of the pact with de Rijk; his creation You Deserve It has clinched deals in several major territories, including the U.S. with ABC and Spain with Antena 3. Five other de Rijk concepts are in active development, Schmidt says, and three are in the presales phase.

Another key creative partnership for Red Arrow is with Omri Marcus, a well-known writer and producer in Israel. “With Dick we focus on broad properties, things that can travel far quickly,” Schmidt says. “With Omri we focus on the more edgy ideas that fit to what the cable space needs, that are interesting for the U.K. market, and also the scripted reality shows that dominate German daytime programming.”

While those relationships exist on what Schmidt calls “the holding level” at Red Arrow, there are other partnerships that have been entered into by the company’s individual production outlets. Its German production company Red Seven, for example, has a co-development pact with the American producer Phil Gurin. “They collaborate on creating ideas and they also look for ideas that work in both of their markets. If you have two producers crazy about an idea in two markets, [it may be easier to] roll it out strategically into other territories” than if it were targeted to just one market, Schmidt says. Also in the U.S., Red Arrow has signed a first-look deal with the Los Angeles-based Genetic Entertainment, set up by Lincoln Hiatt, David Wyler and Curt Northrup. “When we pick [a title up] for our territories, we create sales materials and together with them go out and [pitch the concept to] our broadcasters.”

These relationships complement the third-party distribution deals that SevenOne International has been doing for years now, scoring the rights to formats like Benidorm Bastards, which is slated for a U.S. debut on NBC this year. 

SPOTTING A HIT
Like SevenOne International, Zodiak Rights, the distribution arm of Zodiak Media Group, has a long history of aligning itself with production houses not owned by its parent company. “The reality of our distribution-and-production business means we constantly have to look outside the Zodiak Media Group for new formats,” says Barnaby Shingleton, the head of entertainment. “Unfortunately, we don’t yet have a monopoly on great ideas!”

The company is currently looking into tie-ups with third-party entities “outside the traditional format-export markets,” Shingleton says. “We are particularly interested in exploring opportunities in Asia. It feels [as if] there is untapped potential in a number of territories in the Far East, not least because producers and broadcasters there are open to different types of relationships.”

Describing the alliances Zodiak Rights has with external producers as well as broadcasters, Shingleton explains, “While we don’t necessarily co-develop formats, we certainly provide input to producers who want to ensure their show will make an impact on the international market. This may be as simple as helping to refine a development slate to make it more distributable to a more detailed discussion around the development of specific elements within a format which will add value to that show’s IP. This type of input can provide a valuable additional perspective in a development process that may otherwise be dominated by a single broadcaster.”

SPARK OF CREATIVITY
Unlike many of its major competitors, Sparks Network has decided to stay out of the consolidation frenzy, sticking to its original mission of developing a formal network of top independent production companies worldwide. For Fredrik af Malmborg, the managing director of the company, Sparks Network offers producers similar kinds of benefits they would gain from being part of a larger conglomerate.

“Instead of developing for broadcasters in your territory, you are developing for the world,” says af Malmborg. “You’re also getting access to all the other development companies in the network.” Sparks members, af Malmborg says, benefit from access to the group catalogue as well as joint development initiatives, while still being able to remain independent.

Sparks’s distribution operation has a first-look deal for the output of member companies, and also represents third-party product, including the Wedding TV catalogue. “We will work hard to get [a format] sold to anyone in the countries” that are part of the Sparks network, af Malmborg says. “The big [format] companies, they’ll pick something up and they sit on it. They have no interest in selling it to someone other than their own entities.”

Recently, Asia has been a key growth area for Sparks, particularly since the creation of its Hong Kong office at the end of last year. Another distributor that has looked to the Asia Pacific for expansion opportunities is Turkey’s Global Agency, which last year entered into an alliance with India’s Miditech. “I’m representing their formats, they are representing mine,” says Izzet Pinto, the CEO of Global Agency, on the nature of the relationship, which began with Miditech adapting Perfect Bride for the Indian market. For Pinto, the relationship is not just about having his own formats produced by Miditech for Indian broadcasters. He believes that the Indian production company can produce Global Agency’s own travel reality format The Big Challenge for channels worldwide. “Sending contestants to India for a reality show would be very colorful,” Pinto says. “India is a great place for production—the crews are so creative, and at the same time, the budgets are low compared with Europe or America.”

LOST IN TRANSLATION
Whether co-producing, co-developing or just working with third-party producers to sell their titles, distributors often have to overcome cultural differences in order to make these relationships work. FremantleMedia’s Carter points to the differences in tone and style between content from Japan and what comes out of Europe or the U.S. “Typically, in Japan, they work a lot with semi-professional reality performers and they’re very celebrity-driven. The issue of the onscreen presentation is quite different than in the West—there’s lots of text on the screen, lots of exclamation marks, animation. There’s also a sense in which certain Japanese entertainment can be quite extreme in cases, going to the edge of how people squirm in quite uncomfortable positions. While this can work very well for Japanese viewers, it perhaps does not translate as well to other cultures. So the challenge becomes about holding true to the inherent concept—capturing the humor, the fun, the energy and entertainment in Japanese programming—but refining the flavor of the content for global audiences. The other thing is, a lot of Japanese programs are very long and we Westerners can get very lost in the structure. From our point of view, the programs are often bouquets of smaller programs, as we would see them, so they may need to be tightened and more clearly formatted for the international market.”

The success of the relationship with Fuji rests on three points for Carter, beginning with the constant presence of a translator. “Additionally, there has to be a sense of mutual creative or professional respect between the individuals involved. The third thing is that one has to be very precise about what you’re looking for, what the parameters are. We want a clear format. We want one that is repeatable, transferable and scalable.”

At Zodiak, Shingleton believes that developing successful cross-border creative partnerships boils down to “reconciling objectives; both parties have to pull in the same direction even if they have different pressures placed upon them in the short term. Balancing the needs of a local audience versus the desire to produce an international hit can be particularly challenging, and that’s as true of partnerships with producers in your own territory as it is with producers on the other side of the world. But a good distributor should be able to distill the international value from local hits.”

PERFECT PARTNERS
In a market where competition for ideas is intense, distributors are keen to showcase their sales abilities to potential production partners. “We are in the format-and-production business as a broadcasting group,” says Schmidt. “We have a certain reputation having been, especially in Germany, people who picked ideas up early off paper, even from American producers. That’s the spirit we want to continue with: we respect the idea, we respect the creativity. We are not trying to hide what we acquire in a drawer; we put it out there. We do not necessarily buy as much as others. We focus on things we believe in and we can put on a pedestal. It’s helpful that we have a broadcasting group that’s backing us—you can make clever and intelligent deals across all genres, not only in the format space, but in the end it’s that we have a very good distribution engine where things don’t fall through the cracks, and that’s something that creators respect.”

Schmidt says that Red Arrow is particularly keen to develop more relationships in the U.S., the U.K. and Scandinavia. From a content-acquisition perspective, however, “I don’t care if [a creator] comes from Hungary or from the U.K. or from Mexico. You need to have an understanding of the international format market, you need to have some credibility and a track record.”