L.A. Screenings In Dollars For Los Angeles

By Dom Serafini

Much attention has been paid to the fact that Los Angeles lost up to $23 million a day during the Hollywood writers’ strike. During those trying times, consideration was also given to the L.A. Screenings –– would the studios hold them or not?

Ken Dubow
The Disney-ABC International TV (Latin America) team
at last year’s International Upfronts party.

If the studios opted to cancel or even postpone the L.A. Screenings, the strategic consequence would have been to reinforce the role of MIP-TV (and indeed the market organizer was readying for such an eventuality) and to change the start of the market calendar year, which traditionally starts with the L.A. Screenings and ends with MIP-TV.

Naturally, the studios would not have made such a decision unilaterally, since the L.A. Screenings’ May dates are linked to the TV networks’ upfront presentations in New York.

When, after the writers’ strike settlement, the networks scheduled their upfronts for ad agencies and clients, the studios followed suit with the L.A. Screenings.

Despite all the networks’ talk about scrapping the upfronts, they still have untold benefit, such as good publicity for the networks’ new schedules. Positive buzz translates into more CPM (ad rates).
 Ultimately, as far as calendar dates for both the upfronts and the L.A. Screenings were concerned, the writers’ strike had zero effect.

What has been affected by the strike, however, is the number of pilots that international buyers will be able to screen in Los Angeles May 15 - 23. But we’ll return to this subject later.
Something that was not taken into consideration, among the various doomsday scenarios, was what Los Angeles would have lost had the L.A. Screenings been canceled.

For the studios, international TV distribution is a year-round business. However, many deals close during the L.A. Screenings. It has been estimated that for the studios, under normal conditions, the L.A. Screenings could represent an event worth up to 60 percent of their annual revenues, even considering that several deals will take weeks or months to close.

But, in this big pot of gold, there are many more nuggets to pick, like the net worth to the trade press, consultants, coordinators and to the city itself.

For this latter entry, according to VideoAge estimates, the nine-day event infuses at least $7 million into the local economy. This figure was reached by taking the peak attendance of 2,000 people, multiplying that by the length of stay per delegate (five days), multiplying that number by the average for daily expenditures per delegate ($350, which includes lodging, transportation, food, shopping, etc.) and multiplying that number by a factor of 1.64, which yields a total $5.74 million. The multiplier factor depends on the event profile and varies from 1.5 to 1.64.

The formula used was developed by Washington D.C.-based Destination Marketing Association International (formerly known as the International Association of Convention and Visitor Bureaus), as reported in Meetings & Conventions magazine.

In any case, those figures don’t include expenditures by the studios, by some independent distributors for parties, presents, promotional materials and such, and even by the buyers that commission reports about the new season from local consultants. All of this would bring the total to more than $7 million. Not bad for a market that isn’t even organized!

At the L.A. Screenings, the length of stay per delegate is much longer than the average (which, according to a study, is 3.56 days per market) because of the nature of the event, which requires daily screenings followed by negotiations and end-of-show parties.

The part of the L.A. Screenings that adds more money to the whole local economy equation is the creation of pilots for the new U.S. season. According to a much publicized comment made by NBC-Universal CEO Jeff Zucker, the U.S. broadcaster could save as much as $50 million a year by reducing its reliance on expensive pilots. This translates into a cumulative cost savings for the major TV networks of about $200 million per year. Even though it is unclear how much of these savings would affect Los Angeles’ local economy, the impact is nevertheless substantial.

Zucker said that nowadays, each pilot costs up to $7 million (up from about $3 million in 2005) and some never even air. In late January, ABC let some 40 scripts go, dropping the most projects of any U.S. network. With 29 pilots last year ABC financed the largest number of pilots, followed by FOX (25), CBS (21), NBC (20) and the CW (12). Of these 107 pilots, the networks picked up 66: a 61 percent ratio. This year, with talks of cutting the number of pilots in half, one could be looking at around 50 pilots, but with a better pick-up ratio. In recent years, in order to save money, many networks started using a straight-to-series strategy or requesting video presentations (which are less polished, shorter and cheaper than regular pilots) instead of pilots, despite the fact that many presentations have to be re-shot before going to series. For example, a big (e.g., expensive) action/crash scene could be omitted or done with a blue-screen background to save costs but to demonstrate how the show flows. 

Reportedly, CBS’ Moonlight, which premiered this past season, was ordered as a presentation. Similarly, the network’s long-running series Judging Amy was also a result of a presentation. However, strange as it seems — since networks own their own studios — the studios prefer making pilots rather than presentations, because they get a higher license fee.

Another possible money-saving solution for networks and studios alike is to follow MGM’s strategy of producing backdoor pilots, which are movies that have the potential to become TV series. Indeed, last February, NBC aired Knight Rider as a two-hour TV movie that could be used as a backdoor pilot.
As far as the L.A. Screenings are shaping up, one could expect that, because of the dearth of development, more of the current season’s new shows could return this fall. In addition, since many new shows will proceed as compressed windows (i.e., when there is less time than normal to order, cast and shoot the pilots or presentations), the studios might not have footage of those series to show international buyers.

However, if broadcasters scale down the number of new series, there are always the cable networks, which accelerated their new season upfronts with initial meetings with ad agencies starting as early as February.
Even though the studios are happy when networks order pilots, more appreciated are episodic orders. But, with all the cost-cutting measures implemented by the U.S. networks, studios are now reluctant to accept six-episode pickups, pushing instead for 13-episode initial orders, which are equally appreciated internationally.
To navigate through the networks/studios new TV season terminology maze, MGM’s TV Distribution co-president, Gary Marenzi, offered to explain how the networks have traditionally placed their orders:
Script order: A pilot script plus a “bible” of several episodic synopses. The network usually pays 100 percent.
Pilot order: A video pilot or extended presentation to decide if the script concept works. The network usually pays an agreed-upon fee for this.

Series order: If the network likes the pilot, it will order the series (usually an initial six-to-13 episode commitment) and put it on the schedule. These are the shows that are presented at the L.A. Screenings.
Pickup: This means that the network extends the first season order of a show from the initial order to a full 22-episode season (usually).  If the original order is 13 episodes, this can also be called “picking up the back nine” (13+9=22).

Renewal: This means ordering a second season of a show (past the original 22 or whatever the first season’s total number of episodes was).

In terms of production schedules the pilot season begins in early February and ends around April 15. The episodic season, on the other hand, begins after July 4, picks up with full force mid-August, runs through the holidays and ends by Christmas. There are also episodics that run all year, especially on cable.