{"id":19268,"date":"2020-10-01T12:00:53","date_gmt":"2020-10-01T16:00:53","guid":{"rendered":"https:\/\/dev2.worldscreen.com\/tvkids\/worldscreen.com\/"},"modified":"2020-10-01T12:15:02","modified_gmt":"2020-10-01T16:15:02","slug":"can-we-share-mipcom2020","status":"publish","type":"post","link":"https:\/\/worldscreen.com\/tvkids\/can-we-share-mipcom2020\/","title":{"rendered":"Can We Share?"},"content":{"rendered":"

\"\"<\/a>Between the emergence of a raft of new AVOD platforms and linear broadcasters stepping up their requests for digital rights, the business of distributing kids\u2019 shows has become increasingly complex. <\/em><\/p>\n

They say sharing is caring, but in some parts of the kids\u2019 business, no one wants to share, creating complications for IP owners looking to fully maximize the value of their properties.<\/p>\n

\u201cYou just don\u2019t have those traditional windows like you used to, because people want exclusivity,\u201d says Alix Wiseman, the senior VP of distribution and acquisitions at 9 Story Media Group. \u201cThe hardest part is extracting the value that is commensurate with what you\u2019re making from the platforms that want to license it, given that you just don\u2019t have as much scope in terms of windowing.\u201d<\/p>\n

Ed Galton, managing director and chief commercial officer at CAKE, agrees, stating, \u201cWhile we will always push for non-exclusivity and a collapsing of as many windows as possible, the truth is that the traditional platforms have become more reticent about sharing than in the past. They don\u2019t want to give any window of opportunity to work with the SVOD players and preserving AVOD rights has become a priority given that linear channels will ultimately migrate into that space.\u201d<\/p>\n

Morgann Favennec, the executive VP of distribution at Xilam Animation, notes that broadcasters\u2019 needs have evolved alongside changes in viewing habits. \u201cWhile it was not always easy, it used to be possible to satisfy all parties and have major partners coming on board one after another. Over recent months, it has become increasingly difficult to reach outcomes that are fully satisfactory for all involved, as everybody is now looking for exclusivity, particularly on premium content.\u201d<\/p>\n

WHAT RULES?<\/strong>
\nBut, as Emmanu\u00e8le P\u00e9try Sirvin, co-founder and partner at Dandelooo, points out, \u201cif you have the right project that everybody wants, all the rules fall apart. If the show is so-so, they are going to say, I can\u2019t take it because I don\u2019t have this window or I can\u2019t have exclusivity, etc. And it\u2019s almost an excuse. We\u2019re co-producing Mum Is Pouring Rain<\/em> for Canal+\u2014they have the first window. It\u2019s a wonderful director and a very talented artist, so France T\u00e9l\u00e9visions said, We\u2019ll take a second window. If it\u2019s a great show, they will bend the rules. Netflix first started to say they needed to have all first windows and all exclusivity. Now they\u2019re saying, We\u2019ll give it a think.\u201d<\/p>\n

Plus, \u201cthere\u2019s less loyalty from the audience now for specific channels, and instead, kids or their parents will search for their favorite TV shows; they don\u2019t mind where they are found,\u201d observes Alison Taylor, the director of distribution and business development at Aardman. \u201cThe platforms and channels are becoming accepting of that, so it\u2019s become increasingly important for windows, on the top brands in particular, so everyone has the ability to broadcast the most popular shows and have an exclusivity window to do so. Buyers need new IP as well as popular existing brands just as much as producers of the IP need the financing, the marketing, the brand support. Windowing can sometimes be a neat solution for everyone, obviously while understanding the importance of the premiere, especially for the main commissioners as the financiers. This is when windowing can be effective.\u201d<\/p>\n

J\u00e9r\u00f4me Alby, managing director of Mediatoon Distribution, echoes this point, observing, \u201cWhen you are a distributor, you have to maximize the number of windows on which you put your content. The main evolution has been to open those windows, to open the holdbacks, to make sure at the end of the day the kids see the show\u2014a lot\u2014and that you make more or less the same amount of money. You have to have the windowing to make sure there is a viewership you are looking for and you can make money\u00a0and get the exposure you need.\u201d<\/p>\n

As for crafting a windowing strategy, there are a range of factors to consider, from local regulations\u2014such as those in France, Alby points out\u2014to the broader needs of the property.<\/p>\n

FREE FOR ALL<\/strong>
\n\u201cWe always take into consideration all of our business departments,\u201d reports Dorian B\u00fchr, the head of global distribution at Studio 100 Media. \u201cWhen we are talking to potential merchandising licensees, most of them want to know whether there will be free-TV coverage, and ideally, when and how often. This is still a very important parameter for the licensing business, especially for the introduction and brand development of a new IP. However, constant availability on streaming platforms ensures keeping kids connected, as for them, the most important thing is to get to see their favorite show, no matter where and when and how. Therefore, a coexisting solution using a distinct windowing [strategy] is desirable\u2014ideally on all available platforms.\u201d<\/p>\n

At Mediatoon, Alby says the factors that need to be considered\u2014beyond the size of an offer\u2014are visibility, your own cash flow and how a broadcaster or platform will curate your content. \u201cTypically, if you have the luxury of being able to choose between broadcaster A and broadcaster B who propose the same amount of [money], and your cash flow is good, what you will be looking for is\u00a0who\u00a0will best maximize the exposure of the show and\u00a0help\u00a0better roll out a possible L&M strategy. How do you make sure the show will be everlasting?\u201d<\/p>\n

CAKE\u2019s Galton says the nature of a project will also help determine its preferred distribution model. \u201cWith a serialized show and a story arc that you have to follow, you are limited in who you can approach. The linear broadcasters are looking for snackable series that can be aired one episode at a time in any order, while VOD platforms look at viewing patterns differently. Secondly, there\u2019s the level of ambition and size of the show, which is where the economics come into play. The traditional method of how we finance shows has evolved. Some of the series we\u2019re working on are more ambitious with higher budgets. Certain platforms can afford to commit to that additional amount of money and have those shows made.\u201d<\/p>\n

MASS EXPOSURE<\/strong>
\nGalton also points to the importance of ancillary revenues, where a free-to-air broadcaster or platform may be a better route than an SVOD streamer. \u201cDoes it make more sense to be on the free-TV channels of the world, or is it more beneficial to have as many non-exclusive deals as you can so you can be visible on every platform?\u201d says Galton. \u201cIn addition, one needs to consider that if you are being held to exclusivity by a platform that you cannot extract data from, it becomes very challenging when selling in your licensing program.\u201d<\/p>\n

Galton references CAKE\u2019s approach on its Angry Birds<\/em> shorts series, where the strategy was always to do non-exclusive deals. \u201cWe found that the bigger the brand, the less exclusivity was an issue. In contrast, with a new show airing for the very first time, partners demand exclusivity as they want the show to be associated with their platform. There is a bit of an irony there; as long as it gets eyeballs and ratings, that\u2019s what matters.\u201d<\/p>\n

Meanwhile, 9 Story\u2019s Wiseman sees SVODs becoming \u201cmore proactive\u201d in helping to support brands. \u201cYou generally need to have plenty of scope to be able to support a brand off the primary platform as much as possible. That does mean the YouTube world and so on. I think that\u2019s where the conversation needs to be going. And the biggest challenge when it comes to consumer products with children\u2019s content on the SVODs is simply how children, and we as adults, consume content now. We burn through it and we\u2019re done with it in a period of time. It\u2019s not being served up on a weekly basis, which would allow licensees to slowly launch programs. That\u2019s an issue we\u2019re all struggling with. I do think the SVODs are keen to see how they can play a part in maximizing that, which is to everyone\u2019s benefit.\u201d<\/p>\n

Aardman has long managed its AVOD rights in-house, given its strong presence on YouTube, Taylor reports. \u201cIn some instances, we roll out content on AVOD platforms first. We did that with Learning Time with Timmy<\/em>, originally produced for YouTube [and developed with the British Council]. We\u2019ve since been able to license the second window of this series to Netflix and public broadcasters globally, despite it already being on YouTube.\u201d<\/p>\n

CATCHING UP<\/strong>
\nCatch-up rights have emerged as the most contentious battleground. Commercial broadcasters that may have once not worried too much about digital rights want to hold onto them for as long as possible as they build up their own VOD services.<\/p>\n

\u201cYou have to think about the massive role catch-up plays and then what can be done with AVOD,\u201d says Wiseman at 9 Story. \u201cWhat you want to do is not cut all your options out, but it is difficult. I think one of the challenges is that with a lot of the linear platforms, they are now consolidating like crazy, as we know, and they have their own SVOD platforms, so they are reserving those rights for themselves. We need to see that they are going to cover the value of those rights. That\u2019s the challenge for us distributors. For us to be able to deliver top-notch programming with very high production values, if we\u2019re not going to be able to extract that value out of a number of windows because one platform is going to exploit all those rights, it is really important for those platforms to understand the value of those different rights.\u201d<\/p>\n

Dandelooo\u2019s P\u00e9try Sirvin says that pubcasters in Europe are becoming particularly insistent on VOD rights, which blocks the company from doing global SVOD deals on some shows. \u201cSo now we\u2019re much more careful. We reduce the window down to six months with them in order to possibly start the discussions with Netflix or others to make sure we have access to the dub and the rights cleared. We\u2019ve been punished for not being careful enough with that before.\u201d<\/p>\n

Studio 100\u2019s B\u00fchr agrees that broadcasters are seeking out a far more extensive slate of catch-up rights today, which decreases the value of a show for digital exploitation. \u201cOn the other hand, the streamers have become important and lasting players in the market\u2014so there is a slight movement towards a kind of coexistence with different window constellations, trying to find a way to cross-fertilize each other and avoiding the complete exclusion of one platform.\u201d<\/p>\n

Taylor at Aardman reports that \u201csome channels are more cautious than others when it comes to AVOD rights. It can be a sticking point in negotiations, whether it\u2019s the number of episodes or even the number of clips agreed. Often a neat solution is to offer the broadcaster the same content for their AVOD channels that you produce for your own, which satisfies all partners on the show. In addition, if the channel or platform has a vested interest in the success of the show\u2014for example, a share in the ancillary rights or a long-term partnership on the brand\u2014then they will often be more flexible, so long as the premiere is on their channel.\u201d<\/p>\n

PANDEMIC PUSH<\/strong>
\nThe COVID-19 pandemic may have facilitated some increased flexibility in the kids\u2019 business as of late, as broadcasters and platforms alike clamored to serve the needs of kids stuck at home for hours at a time\u2014amid a bruising impact on the ad market.<\/p>\n

\u201cUntil the beginning of 2020, sharing AVOD rights was not our standard approach to windowing, but with the recent decline of YouTube revenues, we have since adjusted our strategy,\u201d says Favennec at Xilam. \u201cThe pandemic provided us with a lot of new AVOD collaborations with partners who were looking for new content on a non-exclusive basis. Our strong [titles], including non-dialogue global hits such as Oggy and the Cockroaches<\/em> and Zig & Sharko,<\/em> were perfect for their needs. We quickly realized that these partnerships did not have an impact on our own digital views\u2014we have 40 YouTube channels that are now generating billions of views annually\u2014and are an effective way of reaching new audiences and generating extra revenue.\u201d<\/p>\n

9 Story\u2019s Wiseman sees that budget concerns already have some broadcasters considering \u201cmore flexibility in terms of sharing. And we\u2019re very open to that. When you look at the level of exclusivity that a lot of SVODs and linear require, there are cases where there are entire series available on YouTube that are also sitting on those platforms. They may not be as threatening or as problematic as some might have originally thought them to be. I think there is a lot more scope for sharing, where both platforms can live easily side by side. That\u2019s a helpful way to move forward, especially for linear channels that are losing so much in terms of ad spend. If they can be a bit more flexible, pay a little bit less, then they will still get great value out of what they\u2019re acquiring, even if it\u2019s on another platform.\u201d<\/p>\n

NEW WORLD ORDER?<\/strong>
\nIndeed, Mediatoon\u2019s Alby sees this as a potentially ongoing trend\u2014with or without the global health crisis. \u201cFive years ago, it was very difficult, especially for pay television, to share some rights or open exclusivity toward AVOD. This is for obvious reasons. AVOD is free, pay TV is pay, so it wasn\u2019t good for them to do it. Everyone tries to navigate this. We all have to find a way for the shows to be seen. The logic that many have adopted is to use AVOD as a tool to promote the broadcast. Let\u2019s say you have a series made of\u00a052\u00a0episodes. You can agree to have\u00a075 percent of the content only for pay TV, and\u00a025\u00a0percent\u00a0on AVOD as a sort of\u00a0freemium content that will\u00a0drive viewers towards\u00a0the pay-TV offer of the series. You can put the first\u00a013 episodes on YouTube and say, Want to see the rest? Log onto pay-TV channel A or SVOD platform B. More and more\u00a0networks are open to this, as it can be a win-win for both partners. There are so many offerings today, if you\u2019re a channel and you want to\u00a0stand out, you better optimize the cross-promotion between the different media and make sure you\u2019re present on all at the same time.\u201d<\/p>\n

And with SVODs spending aggressively in the kids\u2019 space, Favennec at Xilam says there are now opportunities for shows that premiered in a digital walled garden to have a second window on terrestrial channels. \u201cSome traditional broadcasters are open to this scenario and have found it to be a fruitful win-win collaboration, but others have closed that door. It\u2019s uncertain what the distribution landscape will look like in the longer term and what models there will be when we deliver shows a couple of years from now. Will broadcasters want to air a show after Netflix then? It\u2019s hard to say given how things are changing so dramatically and so quickly.\u201d<\/p>\n

FACING THE FUTURE<\/strong>
\nAs for the lingering impact of this year\u2019s shutdowns and plunge in ad revenues, CAKE\u2019s Galton says it\u2019s too soon to tell. \u201cThere is no doubt that we have entered a global recession, but the immediate effect has not been too severe for us. Money was allocated, people had budgets and there was still a need to spend. At the very beginning of lockdown, we saw an urgent demand for content that was already versioned and immediately available and broadcasters were asking for educational content, given that kids were going to be off school for the next six months. We are more concerned about what next year will bring, as I don\u2019t believe we\u2019ll see a negative impact on the distribution industry for at least another six months. At this point, we\u2019re still doing deals and while we\u2019ve had some clients say they\u2019re waiting or they\u2019re on hold, we\u2019re in a consumption-based business and the need for content on platforms is not going to stop because of COVID-19. The advertising market is going to be negatively impacted and this will have an adverse effect on future programming budgets, but viewing patterns across all platforms have gone up. That\u2019s only good for us and whether that will end is still to be determined.\u201d<\/p>\n

One thing is clear: the complexity of windowing today means that you need to have a fleshed-out plan at the outset, taking into account how much money you\u2019ll make from your commissioning platform\u2014and what else you\u2019ll be able to generate one, two, five years down the line. Animation is both expensive and time-consuming, so flying by the seat of your pants on a financing model is just not an option.<\/p>\n

\u201cYou have to understand, if I do this deal with this channel, how that is going to impact the rest of the sales moving forward,\u201d says Galton. \u201cYou have to make a choice and you have to be aware of the path you\u2019ve laid\u2014or the roadblocks you\u2019ve put in front of you by choosing those partners.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

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