Mike Heap

World Screen Weekly, December
21, 2006

CEO

Entertainment Rights

What do Basil Brush, Rudolph the Red-Nosed Reindeer, Postman Pat, Casper,
Lassie, Rupert Bear and George of the
Jungle all have in common?

They will all live as one big
happy family, with Entertainment Rights’ acquisition of Classic Media Holdings
for $210 million (£106.9 million). And Mike Heap, the CEO of Entertainment
Rights (ER), is quite excited at the prospect of being the patriarch of such a
vast brood of fun characters—characters who lend themselves to all kinds
of brand extensions.

As Heap explains, the deal
substantially transforms ER’s business. “We are a company that derives [vast
majority] of its revenues outside of America, and Classic is a company that’s
got [vast majority] of its revenues in America,” he says. “Altogether, Postman
Pat, Lassie, Rupert Bear, Casper, Veggie Tales,
which we are very, very keen on, and Gerald McBoing Boing, give us an incredibly strong brand combination, which can
travel the world, and it also gives us an incredible catalogue. Classic’s back
catalogue is very strong and so is ours. We end up with close to 9,000 episodes
of high-quality, digitized content. It’s an unprecedented opportunity to create
one of the strongest portfolios of children’s brands anywhere in the world. So
yes, I’m very happy about it.”

The acquisition is expected to be
approved by ER shareholders early in January.

The acquisition of Classic Media
is not ER’s first foray into the U.S. market. Besides selling individual shows
to U.S. TV outlets, such as Postman Pat
to HBO Family, ER purchased the Filmation Library, home to The Archies, He-Man and the Masters of the Universe, She-ra and many
others. “We’ve done very well with Filmation in the U.S. We’ve sold a million
DVDs, an extremely pleasing performance, and we’ve returned the Filmation
Library to 60 different countries on television,” says Heap.

The Classic Media deal also gives
ER access to qubo, a program block jointly owned by NBC Universal, Scholastic,
Classic Media and Corus Entertainment. qubo is carried on three networks in the
U.S: NBC on Saturday mornings; i network (formerly PAX TV) on Friday
afternoons; and Telemundo, the Hispanic network, on weekend mornings. qubo will
become a 24-hour digital terrestrial service in January. Veggie Tales already airs on qubo. “We assume all of Classic’s
responsibilities in [qubo] and we’re very happy about that,” says Heap. “It’s a
multi-platform partnership and the content has to reflect literacy and positive
values, which is exactly what Veggie Tales does and Postman Pat does
exactly the same. Content is king and I obviously agree with that. There is no
point having a load of content without the distribution. But there is
definitely no point in having distribution without content.”

In today’s crowded media
environment, what cuts through the clutter is a recognizable brand. “That’s the
key to my business and that’s how we set it up in January 1999 when I first
bought Basil Brush,” says Heap. “It’s
always been about owning the brand. And it’s a fact of life that we bring
brands to market via television and we do licensing, merchandising, publishing,
video and recorded music. But we do all of that mainly because we own brands,
and that is the thing that is of the most importance to us.”