Elizabeth Guider Reports Ahead of the L.A. Screenings

May 2, 2012 World Screen Top Stories

PREMIUM: The major Hollywood studios continue to generate solid licensing fees from their broadcast clients and are now eagerly exploring opportunities with new platforms worldwide, reports Elizabeth Guider.

 

Forget the wow factor. When it comes to Hollywood’s international-television business, it’s the how factor that counts. As in how to maximize revenues from program sales when big-time broadcasters abroad are increasingly making their own first-rate (and highly rated) local shows, when so many hit American shows are getting long in the tooth, and when newcomers to the U.S. network schedules have not set the world on fire recently.
 
Despite these and other challenges, the six Hollywood majors, who jointly account for the lion’s share of the program-sales business done abroad, have adroitly managed to lock in healthy license fees from their traditional broadcast clients and at the same time to get into bed, at first gingerly and now more eagerly, with the SVOD platforms and niche players popping up around the globe. Overall revenues from the sale of TV shows and feature films abroad in 2011 will purportedly hit an all-time high of $8.5 billion, per sources that track the financial performance of the top U.S. content providers.
 
The majors have pulled off this feat during a stubborn recession across much of Europe, which in turn has put downward pressure on television advertising and on program-acquisition budgets. But even in as tough a market as Germany, where local shows are the mainstay of the schedules, the top commercial players RTL and ProSieben went up against each other recently in what was described as “frothy bidding” to wrest the latest multiyear package from Warner Bros. (ProSieben will get the deal back from RTL in 2013.)
 
“During one of the worst financial downturns in Europe, we have renewed deals for high prices and for long terms in France, Spain, Italy, Australia and Scandinavia, as well as in Germany,” says Jeffrey Schlesinger, the president of Warner Bros. International Television, describing just how counter-intuitive the international TV business is. Downturn or not, acquisitions are cost-effective and in some cases can help brand a channel.
 
“Granted, we haven’t heard a lot of wows at the Screenings of late, but inarguably it’s been an unbelievably long run of global success for U.S. shows abroad,” adds Marion Edwards, the president of Twentieth Century Fox International Television. “If there’s not been a breakout drama in the last couple of years—and we can’t discount problems in Greece, Italy and elsewhere—we’ve been able to take advantage of new developments and platforms around the world. Five years ago they weren’t even there, but now Netflix, Amazon and all sorts of new players are changing the dynamics and opening up opportunities.”
 
So, how do the big six Tinseltown players do it? The heads of the distribution divisions all put the accent in the same place. It’s about delivering quality series that can be nurtured into successes at home on the U.S. networks and that are targeted, promoted and made available astutely by the acquirer abroad.
 
Even the majors’ definitions of what seems to be working best in foreign markets display similar characteristics, whether the genre is action, suspense, family, fantasy, romance or high concept:
“Good strong episodic drama with strong central characters,” says Warner Bros.’ Schlesinger.
 
“Big promotable hours with clear plots and relatively few characters,” adds Fox’s Edwards.
 
 

A-LIST CREDENTIALS

Among the 85 or so current pro­jects vying for a prime-time pickup for the 2012–13 fall season Stateside, a dozen have generated considerable buzz, and boast A-list talent attached in front of or behind the camera—or both.
 
Kevin Williamson is hatching a drama about a serial killer with Kevin Bacon (Warner Bros.), Shonda Rhimes is doing a period piece set in 1890’s New York called Gilded Lilys (Disney), Shawn Ryan and Martin Campbell are readying a submarine suspense series called Last Resort (Sony), Bradley Whitford is top-lining a spy drama called The Asset (Fox), Dick Wolf is masterminding an action ensemble hour called Chicago Fire (NBCUniversal) and an offbeat cop show called Widow Detectivecomes from Carol Mendelsohn, starring John Corbett and Jennifer Beals (CBS Studios). Other über-producers in the thick of it this development cycle include Jerry Bruckheimer, J.J. Abrams, John Wells, Josh Schwartz and Greg Berlanti, who has three shows in contention. And those are just the dramas.
 
No project is a shoe-in, however, and no name producer is guaranteed a slot. Even Hallelujah, a show from Marc Cherry, the force behind Desperate Housewives, was passed over at ABC. What gets greenlit depends on the specific needs of each network and the analysis of long-term value in any given piece of content.
 
Still, barring the unforeseen, Warner Bros. is poised to surface yet again as the biggest supplier both of new comedies and of dramas to the five broadcast networks, boasting as it does first-look deals with a number of key creators around town. Schlesinger rattled off the names of several contenders on his lot that he suspects will go to series and will have international appeal. Among them, he notes, is one for The CW called The Selection, which he thinks captures the zeitgeist of the moment; he describes it as a cross between The Hunger Games and The Bachelor.
 
Admittedly, with so many new outlets abroad and so much more production from every entity imaginable, nonfiction fare, original and formatted, is playing a growing role on schedules from Slovakia to Singapore. Nonetheless, it is still American drama that pulls in the biggest bucks for the studios, arguably 70 percent of the overall haul from the licensing of TV product. (Fees for feature films are not to be sniffed at, however. All told, American movies sold to foreign TV outlets, free, pay and what-have-you, still account for roughly half of the total $8.5 billion annual haul. Japan, Italy and Russia are particularly movie mad at the moment.)
 
 

THE WOW FACTOR

As to the gripe from foreign buyers that nothing they’ve seen at the last three or four L.A. Screenings marathons in May have bowled them over, Armando Nuñez, the president of CBS Studios International, has a ready response: “[There’s] no sense in having a wow factor in a show that goes for only six episodes.” More important, he contends, is having what he calls “a formidable studio production operation” and “a highly successful network” for which most of that studio’s pickups are earmarked. (Thanks to the end of fin-syn rules, the networks, including CBS, now notably rely on product from their own sister production studios.)
 
Nuñez’s portfolio has been the slow-burn success story of the decade in that both the tripartite CSI franchise and the NCIS duo have done more to solidify the American drama presence in prime time abroad than any other two shows, at least since the Disney-distributed combo of Desperate Housewives and Lost a decade ago.
 
“The thing about NCIS,” Nuñez adds, “is that it faced considerable skepticism initially among foreign buyers.” As a spinoff of the respectable but hardly breakout JAG (judged too military-oriented and too courtroom-centric by the European clientele), the show, starring Mark Harmon, was slotted only grudgingly by CBS at first. Its delicate balance of serious drama and whimsy, Nuñez says, helped it find its audience, turning the show into a hit in many major territories.
 
 

EYE ON THE PRIZE

With a slate that includes three other hit CBS shows, Blue Bloods, Hawaii Five-0 and The Good Wife, CBS Studios International in 2011 surpassed the traditional top supplier to Europe, Warner Bros., with more hours aired in prime time (4,861) across 119 channels in 21 countries than its nearest rival. Warner Bros. was in second place with 3,891 hours, according to a recent report out of London entitled Imported Drama Series in Europe.
 
In short, it’s not essential for a buyer to be wowed by one or more contenders during the annual unveiling of new prime-time fare in order for the U.S. studios to actually go home with (or eventually amass) a winning hand. Some shows strengthen in their second or third season and are much preferable to something that seemed a slam dunk on first viewing but whose story line eventually sagged.
 
As one analyst who focuses on the European market opines, “The smart program buyers are rarely drawn into bidding wars on the basis of a sexy pilot or hype in the press. They want to see and hear more about a series, they employ reps on the ground in L.A. for year-round intelligence-gathering, and unless competition in their own market suddenly gets ferocious, they take their time in making choices.”
 
The sad news is that most shows do not make it past the first year, which explains why most buyers do deals for multiple shows with various Hollywood suppliers. It also explains why those who have the luxury of cherry-picking on the open market, like the British, tend to wait months to sign on the dotted line, until they’re convinced a new American show is headed in a propitious direction. The current season has already seen several highly touted dramas struggle or fall by the wayside, including FOX’s Terra Nova and Alcatraz, CBS’s A Gifted Man, ABC’s The Riverand Pan Am and NBC’s Prime Suspectand Awake.
 
 

SOPHOMORE RUSH

Among those series that appear to be gathering steam heading into renewal season are Person of Interest on CBS, Grimm on NBC and Scandal on ABC. NBCUniversal reps recently dispatched several key cast members of another of its frosh crop, Smash, to London for a promotional blitz ahead of the musical drama’s debut on Sky Atlantic and other Continental European stations. During the promotional stunt in Europe, word came down that the series would be returning for a second season on NBC. 
 
Along with the abiding appeal of American drama abroad, other changes in global audience tastes have benefited Hollywood producers of late. One of them is a worldwide hunger to see talked-about material in the most timely fashion, a shift that all the Hollywood majors have hastened to address in their deal-making and partnerships.
 
“One of the biggest changes is how the distribution of our content has quickened and how our partners are using new media to expand viewership,” says Ben Pyne, the president of global distribution at Disney Media Networks. Pyne says the studio is finding incremental value in shows by slicing their windows more narrowly, in some cases making hot-ticket items available abroad within 24 or 48 hours of the Stateside release, and in a few others staging the premieres abroad ahead of the U.S. debut. That’s what Disney did recently with Body of Proof and Missing. Like his counterparts at other studios, Pyne is also finding ways to boost the shelf life of series with services abroad like ABC TV On Demand and Disneytek, which allows for the downloading and viewing of full episodes after their first broadcast.
 
For another thing, comedies, which for decades did not travel far beyond English-speaking territories, are catching on in the most unexpected of foreign climes. The rise in interest in “funny business” arguably started with NBCUniversal’s 30 Rock and The Office, but has since intensified and spread. Two and a Half Men is making them laugh on Germany’s Kabel Eins (in a second window, no less), Scandinavia is tittering over 2 Broke Girls and New Girl, and Happy Endingshas found enthusiastic fans in far-flung parts of Europe. Part of the reason has to do with Internet-attuned, glo­balized tastes among the young set wherever they are and part has to do with the revitalized strength and diversity of sitcom story lines from ace writer-producers like Chuck Lorre, Steve Levitan, Ryan Murphy and Michael Patrick King. Not to mention the universal desire to laugh amid all the depressing economic news.
 
BANKABLE LAUGHS
“It’s not unheard of for a top-notch laugher to pull in upwards of $1 million an episode from foreign [sales], a sum unheard of just five years ago,” says one analyst, who is not authorized to give out specific examples. That sum would include the cumulative fees coming in for second cycles of series on alternative platforms, which are enticing new viewers to the genre.
 
“There are some wonderful new players out there with whom we are now doing business in sync with our traditional broadcast partners,” Fox’s Edwards says. “In this new world, everything is open to negotiation, and things like exclusivity and early SVOD windows drive program prices higher.”
 
And as American television has seen a proliferation of outlets that are increasingly niche-specific and narrowly targeted, new platforms abroad have followed a similar trajectory. In so doing, these foreign outlets have become highly receptive to edgy, alternative, up-market and/or challenging fare made for U.S. cable networks like AMC, FX and USA Network, as well as for the traditionally buzzed-about premium pay services HBO and Showtime.
 
To take one example, Sony Pictures Television has carved out a sizeable business abroad with such critical darlings as Breaking Bad, Justified, The Big C and Damages.
 
“I think the trend started with FX’s The Shield, which arguably pioneered the antihero genre and found respectable, and receptive, audiences abroad,” says Keith LeGoy, the president of international distribution at Sony Pictures Television. “Our foreign partners are now finding different ways to skin the cat with such shows as these, which tend to instill compulsive viewing habits on the part of core audiences.”
 
Similarly, Homeland, one of Showtime’s most provocative new series, is attracting a following abroad, becoming cult viewing, for example, on Sky in the U.K. The series is licensed by Fox internationally and is based on an Israeli format, another indication of just how porous the borders now are for good ideas, in both the fiction and nonfiction categories.
 

If, indeed, imitation is the sincerest form of flattery—and also helps boost the overall value of a seemingly largely exploited commodity—a plethora of players in disparate territories are paying American creators the compliment, trying their hand at localized versions of Hollywood TV fare. CBS’s Everybody Loves Raymond, sold by Sony Pictures Television, is getting a Saudi makeover. In Asia, Fox’s 24 will be reimagined in India with Anil Kapoor in the Kiefer Sutherland role, and Disney’s reality juggernaut The Amazing Race has just clinched its ninth deal for a localized competition, this one in Vietnam and the Philippines.