Survival Guide

From tapping into AVOD opportunities to exploring new financing mechanisms, leading distributors share how they are navigating the factual business today.

The headaches in the scripted business tend to garner the most headlines—be it the strikes that took place last year in the U.S., escalating talent costs or belt-tightening at the streamers. But those operating in the factual distribution business face sea changes of their own, not immune to strategy shifts and complex rights negotiations. At the same time, consolidation continues to play out in the background, adding a further complication to the always-present challenge of securing access to high-quality content.

As for what’s happening in the streaming landscape, “‘strategy shifts’ is indeed one very diplomatic way of putting it,” quips Stefanie Fischer, managing director of distribution at Off the Fence. “Over the past year, there has been massive restructuring in these organizations, including their personnel, which means many valuable relationships are instantly lost. We all know that some of these projects take weeks and months of discussion, and we have found ourselves in search of new contacts, building up new relationships in an environment that often still holds a lot of uncertainty, which leads to very careful decision-making and that can frustrate the process hugely.”

“We can feel the impact and uncertainty in the market,” adds Anne Olzmann, managing director of Albatross World Sales. “It’s challenging to keep up with all the mergers, acquisitions and overall shifts. Unfortunately, there have been many layoffs in the industry and also a number with business partners we had long-standing relationships with, so we have to adapt to this new market situation. What’s new today may be old tomorrow—it all moves quickly.”

And with that comes the need for agility. Where once companies were learning to adapt to streamers wanting to take all rights globally, they are now evolving quickly to meet the need for more flexible models.

“We have ‘leaned into’ the global streamers more as they are way more co-pro friendly,” notes Paul Heaney, founder and CEO of BossaNova Media. “If they’re more open to our model, we are very happy to include them in this world, as long as we can supply the projects that fit their briefs. We’re finding that the producers are already developing in this area: short, impactful crime, noisy singles and unusual reality or access.”

Mirjam Strasser, head of sales and acquisitions at Autentic, has also seen the global streamers be “more open to windowing and carving out territories than before, which is also a good thing. On the other hand, however, they increasingly focus on local productions and themes that are locally relevant for their users, making programs harder to sell internationally.”

The rights landscape, meanwhile, continues to evolve as SVOD operators roll out ad-supported tiers, broadcasters expand their on-demand services and everyone eyes the FAST space for even more monetization opportunities.

“We need to be very careful as many SVOD streamers now also seriously consider AVOD and FAST rights, which can collide with broadcaster catch-up and holdbacks,” explains Albatross’s Olzmann. “If the limits between SVOD and AVOD vanish, rights and budget negotiations will become even more challenging for all parties involved.”

AVOD is an increasingly important part of a show’s overall distribution life cycle, “and these days not just for the long tail of revenue they have traditionally represented,” says Off the Fence’s Fischer. “Of course, now, with the market expanding exponentially, there is an endless sea of platforms and channels. You really need to partner with the right ones, but when you do, it helps with overall revenue targets and can additionally help with getting projects over the line to greenlight if that last bit of financing is still missing. Also, the beauty of FAST channels is that they can go micro-niche as they don’t need to serve a broad audience.”

Albatross has several AVOD and FAST clients, working across flat-fee, minimum guarantees and revenue-shares, Olzmann explains. “2022 was the first year with significant revenues coming from these rights. In general, it is still all about volume and package deals, as well as titles with a longer shelf life, which have mostly made their TV runs or are in their second or third VOD window. This is great for genres such as wildlife and travel, which have a longer life span than science and current affairs programs.”

Strasser says that AVOD is beginning to have a material contribution to the revenues at Autentic, both in content sales and advertising revenues. “We have launched five of our own FAST channels within the last ten months, and we have plans for further expansion of our FAST activities. These channels are a great way to extend the life cycle of our back catalog programs.”

PBS International, the commercial arm of American public broadcaster PBS, is also eyeing the FAST opportunity.

“There has been somewhat of a subscription fatigue happening,” says Joe Barrett, VP of sales. “About half of online users are doing both SVOD and FAST. It just gives them another option to alleviate this subscription fatigue. We’re leaning into that cautiously, but we intend to grow our FAST business by expanding our partners and channel offerings.”

Having a library is one thing; having a steady flow of product to sell is another. And given the competitive landscape, distributors are boarding projects as early as possible.

“Think of the earliest possible time, and it’s earlier than that,” quips Heaney at BossaNova. “Of course, we have to be early—and now so early that some of us are even helping to shape the projects in a sensitive way so we have global appeal but don’t influence too much and make it an editorial blancmange.”

BossaNova works with its producer clients and partners in a range of ways, Heaney explains. “It’s our day job, so funding allowing, we would help get a well-loved project up and running very early, not just by preselling but by cash-flowing. This is the new world. The risk profile is greater, but this is how the market has changed.”

Off the Fence similarly touts its financing skills, both as a producer and distributor. “We can come in at any stage, purely as a distributor to secure financing or as a co-producer to develop a project further,” Fischer says. “We work very closely together on making a project as globally appealing as possible while securing the right partners. Having bases in London, Bristol, Amsterdam and Toronto means we have an international perspective as part of our culture.”

As for the assistance it provides producers, Fischer notes: “The makeup of our business covers all aspects of the creation and delivery of content—and in that way, we’re super flexible, we can come on board any time, in any way, since we’re an integrated studio with expertise on all levels of development, production, financing and distribution and can go beyond what a ‘traditional’ broadcaster can offer in terms of co-development, co-production, co-finance and distribution advances. Naturally, we can also help find co-financing partners, presales and co-productions.”

Albatross can also come in at different stages of a project, as long as there is “some financing in place,” Olzmann says, “and it should be very clear what editorial angle the film will have. Depending on the finance gap, we can work out a detailed strategy for each project individually.”

Strasser says that Autentic is firmly focused on expanding its network of producer relationships, especially in Canada, the U.S., Italy, France and parts of Asia.

“We also partner with producers as early as the project stage to help them find the right partners for getting a program financed,” Strasser says. “We connect producers with international broadcasters that we think could be a good match, and they might not be in touch yet. In addition, we are actively increasing our investments in factual productions by co-financing, providing gap-financing solutions and offering minimum guarantees as part of our commitment to continuously strengthen our content portfolio.”

In the funding jigsaw, co-productions remain a vital tool. “It is a dominant solution to the funding puzzle, but there are other ways,” says BossaNova’s Heaney. “Co-pros allow you a reasonably and comparatively quick way to greenlight a series by using various members of the coalition of the willing.”

For U.S. pubcaster PBS, co-pros have been key, Barrett notes. “We do engage in production financing and co-pros pretty regularly. We’re public TV, so we need to be creative in our financing.”

Off the Fence’s Fischer says co-pros are of “utmost importance” today. “It’s hardly the case that you see a fully funded commission, which means we increasingly rely on co-productions or at least co-financing to get the projects to greenlight.”

Autentic’s Strasser, meanwhile, calls co-pros “essential. A lot of content would simply not get produced without co-production partnerships. We are lucky to be able to rely on established relationships with co-production partners that we frequently work with. Co-productions help us to reduce our investment risks, ultimately allowing us to get involved in more projects. Our team is good at understanding factual viewing habits and preferences, and we love to play in the linear channel market alongside VOD opportunities. Especially in the digital channel business, production volume is key when it comes to playing a meaningful role.”

While the old-school co-production model is still in vogue, industry experts are watching to see what new funding models emerge and will be waiting to see how the business as a whole adjusts to what may be a protracted shutdown of scripted production in the U.S.

“It is still too early to predict the actual impact, though we feel a shift in buyers’ approach to documentaries,” says Olzmann at Albatross. “More streamers are trying out wildlife or travel content, and they seem to be more open to international content. I believe we will mostly see the change next year when the strike will be felt on-screen; at the moment, they still have a lot of content to go through, but this will change.”

“The current circumstances have amplified the already high demand for documentaries and non-scripted content even further, creating an even greater surge in interest,” says Autentic’s Strasser. “Broadcasters and platforms need to fill their schedules, and when scripted shows can’t be produced and they run out of content, factual is the first thing they turn to.”

“In the U.S., we’re seeing major channels acquiring our long-running brands for prime-time slots,” says Heaney at BossaNova.

“While we haven’t seen an immediate impact, we foresee a non-scripted world where scripted talent will be more available to help package shows, be that on- or off-screen,” observes Off the Fence’s Fischer. “Our collaboration with Dash Pictures for Billy and Dom Eat the World, for example, is a six-part series featuring talent more often associated with the big screen: actors Billy Boyd and Dominic Monaghan (The Lord of the Rings). We are very keen to see more talent of this caliber work with us.”

As for audience interest, the cores of wildlife, true crime and history never go out of style, but viewers are seeking new perspectives.

“We’re still mainly focusing on our strong core genres and keeping an eye on how the requirements are changing, e.g., less blue-chip, more diverse, hitting a younger audience and talent,” Fischer says.

“Recently, we have witnessed a growing interest in popular science programs that engage and resonate with a broad audience,” observes Strasser at Autentic. “Global viewers seek programs that demystify current scientific developments and discoveries in an accessible and engaging way. We have also seen an increasing interest across broadcasters and platforms in green productions and storytelling. As the impacts of climate change become increasingly pronounced, programs about our climate and environment are something that speaks to audiences around the world. We are always looking out for documentaries that address environmental issues.”

Olzmann at Albatross is keeping an eye on the overall trend toward “more innovative and emotionally engaging storytelling techniques, leveraging the latest filmmaking tech­nology and approaches to provide unique and compelling viewing experiences for audiences. Especially when it comes to wildlife films, we observe a focus on the intimate and emotional stories of individual animals rather than just presenting a broad overview of a particular species or habitat. It could be described as character-driven, though it must always remain scientifically accurate, which can be tricky. But it seems to work well with the audience and can be a great tool to get the viewer emotionally engaged.”