Taking Flight

October 2009

For players in the global children’s television business, these are challenging times. Despite the recession, the decline in advertising expenditures, and new-media platforms and devices all competing with the TV set for youngsters’ attention, it’s still possible to launch new product—possible, but challenging.

“It’s much more difficult today, for a number of reasons,” says Brian Lacey, the executive VP for international at 4Kids Entertainment. “Can you roll out a program in the big markets around the world in a six- to nine-month period of time? Yeah, you can, but the likelihood is you may find your content on a pay-satellite service that in key territories may only reach 10 or 15 percent of the marketplace. You’re not able to drive video games, trading-card games, promotion licensing, publishing. There’s not enough heat there.”

The keys to getting around the challenges in today’s kids’ business is ensuring that a property’s quality is high, the concept is unique and the business deal is creative.

Going into MIPCOM, distributors with new children’s programs say the process for developing and launching them hasn’t changed drastically—securing a key co-production partner or two, a few presales in important territories, followed by a broader rollout—but they point out that a lot more is riding on the attractiveness of the program itself.

It sounds a bit trite and it’s next to impossible to quantify, but most in the business agree, story is king and quality will still sell.

“That’s still critically important,” says Chloe Van den Berg, the executive director of international distribution at Classic Media. “If it’s not a story that is going to capture children’s imagination, you can put all the money and marketing behind it, and it won’t resonate with children. What is important nowadays is something that has a unique selling point, something that stands out. When you’re talking with broadcasters, their budgets have been cut back considerably. They’re looking for fewer, but better quality, shows. The key territories are very much looking to acquire one or two incredibly special shows rather than three or four also-rans.”

Meeting her criteria, Van den Berg suggests, is Classic’s newest property, Tinga Tinga Tales, a preschool series based on African folk tales and visually inspired by an African art form created in the 1960s by Eduardo Tingatinga of Mozambique.

“It’s a unique, original idea,” she says. “Claudia Lloyd, the executive producer, worked for Comic Relief and spent a lot of time in Africa. She came across this unique art form with very striking African designs. Claudia learned about all these beautiful African folk tales—why the giraffe has a long neck, why the hippo has no hair. She thought about combining this stylistic art style with these African tales. If you’re looking for what works today, it’s something like that.”

The show is in production now at a studio that Lloyd, the head of animation and children’s at London-based Tiger Aspect Productions, has set up in Nairobi, Kenya.

CBeebies in the U.K. and Disney Playhouse in the U.S. are in for a spring 2010 launch, and Van den Berg hints that some other presales are done, but announcements are being held off until MIPCOM.

Classic Media has largely funded the show itself, Van den Berg says. “Every deal is completely different these days. Finding co-production money or money to fund production is terribly difficult. Every production has its own unique way of being financed today,” she says.

Instead of the usual co-production partner, say a broadcaster or distributor, for its latest series, Huntik: Secrets & Seekers, Rainbow S.p.A. in Italy teamed with Upper Deck, a trading-card company based in Amsterdam.

“Huntik is now in its second season,” says Rainbow’s CEO, Iginio Straffi. “Upper Deck has been on board since the beginning. I think besides the usual co-production, we have to come up with other ways to produce entertainment. It’s what the Japanese have been doing for many years with shows like Yu-Gi-Oh!”

With its popular Winx Club program, now gearing up for a fifth season, Rainbow has taken multiplatform exploitation to a new level. The fourth season launched in April, making a total of 104 half-hour episodes. In addition, one theatrical has been released, with another on the way. There have also been two live musical shows, fashion-themed dolls, comic books, home video, video games, an MMORPG game and more than 600 global licensees.

“We have to be creative and try to put shows on multiple platforms,” Straffi says. “The money is not there from just broadcasters. Even if you sell to ten countries you’re still in deficit.”

For now, Rainbow is riding out the economic storm. “We are probably still financially strong enough to maintain our pipeline of production,” Straffi says. “We hope that in the next year or so there will be an improvement. Five years from now if the situation remains this bad I don’t know what the story will be. Thanks to Winx Club we continue to be the number one property in many countries.”

RAISING THE BAR

“There’s no room for anything that’s less than great,” says Olivier Dumont, the managing director of TV-Loonland. “In the past, if you had something [mediocre] you wouldn’t sell it everywhere, but you would do some sales. Today it’s either great and it sells everywhere, or it’s medium and it sells almost nowhere. The market is so saturated with shows that only the best make it.”

This year TV-Loonland is putting most of its production budget into new seasons of its existing series Little Princess and Raymond, according to Dumont. It’s not impossible to launch a new show, he says, but the company’s returning brands are doing well, “so doing more episodes of them is a safer bet.”

Dumont also notes that TV-Loonland has received few co-production opportunities “that we felt as strongly [about] as renewing those shows for new seasons.”

Dumont looks for strong concepts that can support multiplatform development and he favors digital animation.

“All the properties we have picked up for development recently have a strong backbone in terms of content that can work on more than just TV,” he says. “In order to have interesting website components which are strong extensions of the overall brand and not just a gimmick, we need to ensure that the shows and properties we work on are content-heavy, which means having a strong theme or background so that the website becomes a way to explore that theme or background that is not necessarily dealt with in the series itself. For instance, our series My Life Me will have a very rich website on the theme of manga drawings.”

Last year, TV-Loonland invested in My Life Me, produced by the Canadian-based CarpeDiem Film & TV and backed by TELETOON Canada and the French broadcasters France 2 and Canal J. TV-Loonland will handle all international distribution rights in all media, including licensing and merchandise.

“To make the properties easier to finance, we tend to favor Flash-based 2-D animation or CGI/3-D animation, as these techniques allow for a great deal of animation to be done in countries which have subsidies attached, such as France and Canada. We were able to finance My Life Me heavily out of France and Canada, leaving a very small gap to fill,” Dumont says.

At MIPCOM, TV-Loonland is launching the international rollout of WordWorld, a preschool series funded by public sources in the U.S. According to Dumont, “That show is already quite established. It airs on PBS in the U.S. We’re just distributing it internationally.”

ONLY THE BEST

Edward Galton, the managing director of distribution at CAKE, echoes Dumont’s perspective on focusing on the best of what’s out there. “Whatever we take on, we have to be 100-percent committed that we can move it in multiple territories around the world,” he says. “We want to make sure the shows are well scripted and entertaining. They have to be funny, entertaining and tell a story. They need to have an original look and feel.”

At the same time, Galton says, CAKE has to enhance the product with a full package of on-air and off-air content. “Are we supplying them with additional marketing support? Are we creating extra shorts? Is there an interactive website? Are there web games? Is there mobile content, merchandising, licensing? They want to see it all from the beginning. It’s not that easy to do.”

CAKE’s recent successes include Total Drama Island and Total Drama Action, high-concept animations from Canada’s Fresh TV based on reality shows like Survivor.

Galton says the traditional co-production-presales-full-rollout model is more difficult now. “What’s changed is that you used to be able to rely a lot more on your home territory for financing. Broadcasters have definitely been affected by the economy. They aren’t putting up the kind of money they used to. The phones are not ringing right now. The process of doing deals has become painfully slow. We’re not dramatically changing our business plan. But I think we’re being more aggressive. We have to think of different ways we can get to our broadcasters. We have to convince them that we have shows that are going to work on their networks. Ultimately, they want to buy shows that work, shows that resonate with their audiences.”

But Galton sees perilous times ahead: “You’re starting to see reports of companies having financial problems. Production is taking longer, and that’s having an impact across the board. People are afraid, and they don’t want to take risks. The wave of failures hasn’t started, but I think it’s going to happen. The market was due for a correction anyway. We need greater support from our broadcast partners out there, and we’re not getting it.”

LOOKING EAST

4Kids has had great international success with the Japanese show Yu-Gi-Oh! and it is again looking to Japan for its latest project, Dinosaur King.

“From a creative standpoint, it has to have the potential to be appealing across a number of territories,” says Lacey. “One thing about Japa­nese content that enables it to cross cultural boundaries is it doesn’t take place in any specific time or location. Creatively you look for content that will move across boundaries.”

Lacey notes that some Japanese and Korean productions can cover the bulk of their production costs out of local-market broadcast deals. “Many Japanese shows go into production with a deficit, but it’s small, manageable. We worked closely with Sega and Sunrise Productions out of Japan on Dinosaur King,” he says. “We acquired the rights and we’ve done very well with the series. We’ve sold it in over 100 countries for broadcast. It’s an excellent example of how both sides sat down and we had good, frank discussions on the reality of the marketplace. We advised them not to expect big license fees out of the U.S. or big guarantees out of the rest of the world. We managed expectations and reduced the upfront costs for everybody, and in exchange they agreed to allow us to distribute the series. We’re participating on a shared-revenue basis and it’s turned out to be a very good deal for all sides.”

READING ROOM

Cookie Jar Entertainment has often turned to shows based on books to help get them sold internationally, most notably its various kids’ programs based on the Richard Scarry characters, including Huckle Cat. Ann Austen, the senior VP of development and TV/video sales, says Cookie Jar likes book-based properties, but isn’t limited to them. “We keep a balanced portfolio. We know there are certain aspects that will help sales efforts, like having a marquee property. But you weigh so many different factors. Is it a great story, a great character, a consumer-product bonanza? Is it just really funny?”

Two of Cookie Jar’s most recent projects are based on books: Ella the Elephant and Peter Pepper’s Pet Spectacular. “We developed Ella with a Canadian partner, and we’re looking for presales,” Austen says. Peter Pepper has been greenlit for production this year as a joint venture with Clockwork Zoo in South Africa, the first Canadian-South African animation co-production where the work will not be subcontracted outside of either country.

“Even a less well-known book property is still helpful in that it’s a book that is tangible—you can read it, see the character, get a sense of the world. Anything you have that can help illustrate what the show is about is going to be helpful,” Austen says.

Still, the show has to have the right concept behind it, she continues. “It all starts with the idea. Somebody brings in an idea for a great show. You have to be flexible to get something off the ground because all the rules have changed. You have to keep trying a variety of different ways. Being a Canadian-based company, we always start in Canada. On [Busytown Mysteries] we found a Canadian partner in the CBC, and that gave us a certain level of financial commitment. But we still needed a few other presale partners on board. Cookie Jar has a strict policy that we don’t go into production until we’re 80-percent financed. So we found a couple more territories and then we were off and running. We bring our broadcast partners in at multiple steps along the way. We talk to them about ideas we’re considering developing, about early development, when we’ve got a partner or two on board, and once we’re financed we show them the progress.”

LEARNING CURVE

Alison Homewood, the executive VP of worldwide programming distribution at HIT Entertainment, has begun reaching out to broadcasters in the development process to get the kind of insights that indepen­dents have a hard time learning.

“You’re working more in a vacuum as an indie,” she says. “We had a brainstorming [session] with participation from two broadcast creative people, one from Canada and one from the U.K., to talk about one of our shows that is in a quite advanced stage of development. We paid for one of them to fly across to do it. That was something we did to get that editorial feedback and input at an early stage. If we have two broadcasters that are already involved in an informal way, completely noncommittal, it would be a good experience. It’s the first time we’ve done that. We considered it a worthwhile investment to have that involvement, and we’re very pleased with what we got out of it.”

Everywhere, negotiations are more difficult and complex, Homewood adds. “There is more attention on getting back-end shares where they can, more money back in. They want to benefit from a success in the toy or publishing or home-video market. Broadcasters are starting up their own commercial arms to handle those rights. With Super RTL in Germany, we have a terrific relationship with Thomas & Friends and Bob the Builder where their agency handles all the other rights for us. In France, we’ve moved to a similar model with France 5 where FTD [France Télévisions Distribution] is looking after the merchandising and home-entertainment rights as well. We did the same thing with Mediaset for Thomas.”

But, Homewood says, it all comes down to what’s on the screen. “Good shows rise to the surface,” she says. “Broadcasters are looking for what they’ve always looked for, an appealing story line, strong characters. A defined world is important, and an emotional attachment for the children. Those elements mean the episodes can run and run without getting stale.”