Nicola Söderlund

June 29, 2009 World Screen

President
Sparks Network

Just last week, Sparks Network welcomed three new members to its fold: Schwartzkopff TV of Germany, Japan’s Collaboration, Inc. and Pelican, a newly created Russian outfit. They join some 20 production companies already affiliated with Sparks, a structure that gives the Stockholm-based group an on-the-ground advantage in each member territory. This, along with its representation of formats from third-party producers and broadcasters, has supplied the company with a broad range of titles, including a number of top performers in the reality and factual-entertainment genres. Among them are Intensive Caring, Hello  Goodbye and DNA: The Last Secret. Sparks’ president, Nicola Söderlund, talks about his company’s competitive edge.

TV REAL: What are buyers looking for in today’s difficult economy, and how is Sparks filling those needs?
SÖDERLUND: The economic turmoil has decreased the demand for high-risk expensive shows and increased the demand for proven formats with a reasonable budget. I think the scripted genres will suffer, and NBC placing Jay Leno in a time slot historically dedicated to dramas is one example of that. We have also seen a decline in demand for shows that are too niche, as broadcasters are looking for big audience shares. As broadcasters are risk averse, they will go for shows that have proven track records in order to make spinoffs from them.

I believe that this industry has to consider all possible means of ensuring the quality of programs while at the same time keeping budgets down. One way of doing this is through co-productions. The trick is to keep the local flavor while sharing resources. Sparks Network is in the unique position in the market to be able to provide this to the broadcasters. We are currently working on several projects where a local edition is offered to the broadcaster, but where a big part of the production is shared between several territories.

As our members are present in their local markets, they can adapt quickly to new situations and demands from their clients. The combined development effort of our members is quite impressive and gives us the advantage of rapidly shifting our output to the clients.

TV REAL: Why is it important to have a constant and varied supply of pilots to offer buyers?
SÖDERLUND: The first hurdle to overcome for a new fresh paper format is to get it commissioned. Then the value of the format triples. And the best way to show the efficiency of your idea is to make a broadcast pilot. I believe that a full pilot is far more powerful than a pilot done with limited resources. No matter how experienced the commissioners are, they are influenced by the production quality of the pilot. Then there is always the question of who will pay for the pilot. If you share the risk with a broadcaster, the producer is, at least for a certain period, trapped with that broadcaster, which could also include sharing the format rights. Or if the producer is willing to take the investment and the high risk, the producer sits in the driver’s seat and can offer the format to several broadcasters.

The fragmentation of the market drives the need for diversified products for different broadcasters. Therefore it’s very important to have a wide range of products that could be suitable for different channels. The Sparks members are, in general, broad in their output, but at the same time specialized in certain genres, which makes our catalogue varied in most genres. In these times of economic instability, it’s important to have a broad base of products so that we can rapidly respond to the needs of the market.

TV REAL: How has Sparks managed to remain competitive against larger format companies?
SÖDERLUND: We are constantly growing our business. Our unique business model has proved our strength as we combine a local presence through our members with a more traditional distribution arm. The local members scan their markets for new formats. This is a world-searching machine, which together with the development of formats from the member companies guarantees a great output of some of the most successful formats in the market. As a distributor, we are evaluated on the strength of our formats, and obviously we have proven our right to exist in this highly competitive market.

TV REAL: What benefits do your member companies derive from being part of the Sparks Network?
SÖDERLUND: First of all, our members get connected to a constant flow of proven and successful formats that they have the right to access first. As the value of the Sparks’ formats is increasing, this is the first and obvious benefit. Secondly, our sales organization is getting stronger by the day, and we are now a very respected format supplier in the market. But there are also other values; being part of a creative community where your ideas are tested and filtered is a very useful tool and a benchmark of your creativity. We meet four times a year and have two days of creative discussions about the trends in the market where members pitch their new ideas to each other. We also have constant discussions on all aspects of running a production company, from a business, legal and a creative aspect. We have created a win-win situation between our members and us, as well as between members. We are all striving for the same goal, and that is to maximize their international business.

TV REAL: Sparks is celebrating its fifth anniversary this year. What have been some of the company’s main accomplishments in these past five years?
SÖDERLUND: The main accomplishments for the first five years of Sparks have been to establish a global and very competitive force for selling and adapting formats. Nancy Tellem, the president of CBS Television Studios Entertainment Group, described us as a “global super agency,” which quite well covers our business model. Today we are present in more than 50 territories where the Sparks member production companies both acquire and produce formats. On top of that we have a central global distribution arm based in Stockholm and Seoul. I’m very, very proud of this strong organization. It’s a highly efficient web-based organization run by a limited staff, with the joint

of the member companies, and is a strong force in the market.

I’m also very proud of the creative output we can deliver to the market. We have a great catalogue with successful formats that are traveling around the globe. I hold the Sparks catalogue as one of the strongest in the format business. Through our Asian office in Seoul we are very active in the Asian market, both in acquiring and selling formats. Sparks has a unique opportunity to become a bridge between Asia and Europe and the U.S. Our new formats from Korea and Japan have got a lot of attention with pilots and licenses in several territories.

TV REAL: What are your goals for the next five years?
SÖDERLUND: We need to develop the business around the existing formats and package products for all platforms and combine that with an offering to advertisers. I think that Sparks has a unique offering to advertisers that still hasn’t been fully explored. For that reason, we are also moving into the distribution of finished programs. A lot of the future business model is about being in control of the rights and packaging and repackaging those rights to a range of clients.

But the overall goal is to get a world hit. No matter how hard you work, this business contains an element of a lottery. Because of the fantastic input from the Sparks members, the world’s leading producers, I think the likelihood of success is quite big.