Distraction’s Rodrigue

April 2007

Since its launch in 1997, Distraction has built itself into one of the leading independent format distributors in the world. CEO and president Michel Rodrigue has recently restructured the company into six main areas: Formats, Ready-to-Air, Library, Paper Formats, Lottery and Interactive. This �varied catalogue offers tailored programming, with proven track records and low development costs to fit just about any broadcaster’s needs.

TV FORMATS: In the last couple of years, you and your team have put considerable effort into turning the company around.

RODRIGUE: We have made a major turnaround. Two years ago we were in a really difficult position. We had to buy back our shareholder, who owned 30 percent of the company and wanted out. At that point, the company was �barely profitable—we were just breaking even and we couldn’t find a buyer to replace them. So we managed to buy them out from the proceeds of our business and turn the company around in a year and a half. Today, we have a totally new sales staff and new business-affairs executives. Last year we made a fantastic profit: more than 20 percent of turnover in profits.

TV FORMATS: And you also launched a ready-to-air content division.

RODRIGUE: We decided we would diversify. We would keep doing formats, but our company’s new brand is Distraction. We realized that a lot of people didn’t say “Distraction Formats,” they said “Distraction.” And we broke our business into two different types of activities: formats, because it’s still our primary business, and ready-to-air. We realized we can find product in the market—programs that are not formats but can be sold as [finished product]. This works well if it’s English-language programming. If it’s Italian or German, it’s much, much harder to sell finished programs.

We represent Mediaset formats, and that is a very important catalogue for us. They have very good shows and we do our best to get them produced in English as a format and then we sell the finished English-language show. We produce Love Bugs in Spain and sell the Spanish version all around Latin America, for example.

TV FORMATS: How is your paper formats business?

RODRIGUE: We get a lot of people coming to us with paper formats. Sometimes they can’t sell them in their country because it’s overexposed or the genre is not working in that country. The paper format allows us to also retain a part of the equity, because most of the formats that we sell we don’t own—we represent somebody and work for a commission. [With] paper formats we take a part ownership in it and then our revenues are more interesting.

TV FORMATS: How are you taking your library of clips and creating new programming?

RODRIGUE: Our library consists mainly of funny home-video clips. We have 13,000 of them, which we acquired over the years. Because we made a bit of a profit last year, we’ve been able to invest in repurposing the clips. We create formats that use clips. We edit them in segments. Broadcasters can use it almost as it is, as opposed to before, when we sold only raw material. Now we edit the clips into two-minute segments with a little music and a little story, so we can sell them not only for television to put into programs, but also for new media, such as mobile phones. That’s also a nice revenue stream, it’s very important for us. Because we own the clips, we get 100 percent of the revenue, so that makes up for a good part of our profits.

TV FORMATS: You’ve started lottery formats.

RODRIGUE: This is the toughest part and also the most exciting part. We package the lottery formats from Jonathan Goodson, who created some 25 lottery formats, and he’s also the one who has the expertise. What we sell mostly from our lottery catalogue is of course the format, but mainly the expertise. Lottery is a very important part of our �business.

TV FORMATS: You’ve been busy!

RODRIGUE: Well, we also have an interactive division, so imagine how busy that keeps us. We have been busy turning the company around. But we still think it’s a tough business for a totally independent distributor, especially when everyone is going through mergers and acquisitions. We realized that our organic growth is very limited and that we now also have to think about merging [with another company]. We have been talking to different people and groups, and hopefully this year will be Distraction’s year for important growth.