Water Cooler

by Lauren Gitlin

The 17th edition of DISCOP East will take place June 16 to 19 at the Sofitel in Budapest, drawing producers and buyers from all over Central and Eastern Europe and sellers from everywhere. We spoke to Oliver Kreuter, head of Television for Munich-based Bavaria Media Television (whose company has attended DISCOP East since its inception) about what trends he’s anticipating this year, what product he’s bringing to the market, why DISCOP East continues to be an important event for the industry and how the economy is affecting companies like his.

VideoAge International: What product are you bringing to this year’s DISCOP East?

Oliver Kreuter: As every year, a mix of drama, crime, romantic movies and series. Our highlights are the high-budget literary adaptation The Buddenbrooks by Heinrich Breloer and the stylish French telenovela Second Chance. Clients will also be able to get a first look at our latest telenovela Lilli and the Girls [aka One for All (WT)]. The series is about four women who face great challenges both at work and in their private lives.

VAI: Which of your shows play best in Eastern Europe?

OK: One of our definite best-sellers is the Bavarian telenovela Storm of Love. The series has established itself as a true audience magnet, which channels can use to grow their profile in their home markets. Long-running, well-produced series that can be played daily are key for audience retention.
 In our opinion, the region is always looking for well-produced fiction programs at affordable prices.



VAI: What trends have you noticed emerging at recent DISCOP events? What do you expect to see at DISCOP 2009?


OK: In general, there was a tendency towards local production, especially for long-running series. So we discussed format/scriptrights for our well-proven daily series or telenovelas. We will see at this event how much the crisis has affected local fiction production, and how much will be replaced by other genres.
In terms of content, the broadcasters continue looking for the best programming in drama, crime, and family. There is still a high demand for quality crime series and telenovelas.

VAI: How will the state of the economy affect the market and your company specifically?

OK: As in every country, broadcasters are selecting their programming more carefully, and they will buy only what they really need. On the other hand, we hope to sell more finished product in certain territories because local production has become quite expensive and is sometimes replaced by acquired product.



VAI: Is your company doing anything special for the market, i.e. a party, a cocktail, a press conference?

OK: Yes -- we are a proud sponsor of DISCOPRO. We host a panel at the conference and we also host a pitching session for co-production ideas.
 Bavaria Media is part of Bavaria Film, one of Europe's oldest and most distinguished production units, it is our goal to grow our relationship with Eastern European partners on all levels.
 

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By Dom Serafini

Traditionally, when a country’s economy takes a dive, one of the first things to go are state incentives for the entertainment industry. It’s the same perverse mechanism that makes companies cut their advertising budgets in times when revenues need to be generated the most but sacrifices are required.

This happens because, like advertising for a company that is suffering slowed sales, public officials see city, state and federal funds in the entertainment sector as frivolous rather than essential.

In the case of incentives for the entertainment industry, the city of Los Angeles can offer a good case study for the international film and TV industry.

Last February, Hollywood lost $246 million in tax breaks because California state legislators altered the industry’s economic stimulus. Apparently, the lawmakers thought Hollywood too rich to need this additional money.

A recent report shows that location filming for movies and TV commercials in Los Angeles has fallen to its lowest level on record. As a result, the area’s entertainment sector lost more than 22,000 jobs — about 10 percent of the available workforce — in one month alone. With the government cutting tax credit incentives, film and TV production has started leaving the state, compounding the pre-existing problem of fewer productions.

Almost immediately, U.S. film and TV trade associations began lobbying to convince lawmakers at both the state and federal levels that the entertainment industry is important to both California and the American economy as a whole. They argued that the entertainment industry pumps up to $20 billion a year into the local economy of Los Angeles alone.

Soon after, under pressure from the trade associations, California’s state legislature reversed itself and approved $500 million in tax credits for film and TV productions for five years. Those credits, however, won’t take effect until 2011.

Now, let’s analyze how cutting incentives to the entertainment industry during slumping economic times can have enormous repercussions on a state like California.

During periods of rising unemployment, retail and car sales tend to drop. For many local TV markets, these two sectors represent the bulk of their advertising revenue. With reduced advertising comes a lower number of television commercials being produced, resulting in more unemployment for the TV sector. This is a similar situation to the film industry, in which many workers are out of jobs because of the reduced number of new productions and an increasing number of films going to states offering financial incentives.

And the problems don’t end here. With less marketing power, car and retail sales decline even further, generating more unemployment, which, in turn, causes even further reduced sales, and so on.

The only way to break this vicious circle is to inject financial incentives that bring back production (and thus employment) that restores retail and car sales, which would generate more production…

One could say that the same incentive principle should be valid across all industries, but that’s not the case for a number of reasons.

First, the sector has to be large, and, ever since the loss of the aerospace industry, entertainment represents L.A.’s main employment pool.

Second, entertainment labor is not affected by sales, and thus by poor products, as is the case with cars. If a movie doesn’t do well at the box office, that doesn’t reduce the level of unemployment.

Third, retail volume can be stimulated only by cutting sales taxes, but it’s useless if consumers don’t have purchasing power. Helping banks, as we have seen, only restores bonus benefits to a few top-level executives, without any added values to the labor force. Air transport, another labor-intensive sector, can see an increase in profits with increased general employment; lowering airfares doesn’t mean anything to consumers without income. Real estate and construction are also labor intensive, but incentives can only come in the forms of interest rates and…employment.

I’m sure that some economists would dismiss this analysis as amateurish, but in view of the various problems that these same academics have brought about for the world, I’m hoping that they are savvy enough –– at least for a few years –– to refrain from causing more damage with their theories.

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By Leah Hochbaum Rosner

The L.A. Screenings are around the corner. Soon, television executives from around the globe will descend upon Hollywood to screen the new series the studios and indies have to offer, and decide which shows are right for their own 2009-2010 TV season. VideoAge sought out Sue Deeks, an acquisitions exec for London, U.K.-based BBC, to get a buyer’s perspective on the annual affair. Here, she speaks candidly about programming trends, the fallout from the financial crisis and why she chooses to spend more time with the studios than the indies.

VideoAge International: What trends have you observed from the current crop of network commissioned pilots?

Sue Deeks: It looks like there are many more comedies this year than there have been recently. We don’t tend to acquire a lot of comedy — we currently air quirkier fare like Flight of the Conchords and Family Guy — but it really depends on what the show is. For networks, if they can get a comedy working really well, that’s the Holy Grail for them in terms of attracting audiences and then money to be made from syndication. It also looks like there will be quite a few medical dramas this year. I haven’t yet earmarked anything that I think will be perfect for our channels since nothing has officially been picked up. If I do, it’s almost a guarantee that it won’t get picked up.

VAI: What genre are you focusing on acquiring?

SD: It’s more likely that we’ll find a drama that we like than a comedy. But at this point, we can’t rule anything out really. We fit our acquisitions in around our existing shows, so when we see a piece that we think is a perfect fit for our channels, we go for it. We don’t have set slots. Sometimes we’ll open up a slot for it.

VAI: How many hours of programming are you planning to buy at this year’s Screenings?

SD: There’s no set number. We play it by ear. We’ve got a lot of returning series this year, including Heroes, Mad Men and Damages, so it looks like we won’t have as much room for new shows. But like I said, we’ll see what’s out there and if need be, we’ll create a slot for it. We don’t have a certain number of acquisition hours. We can afford to be very choosy.

VAI: Do you tend to spend more of your time with the studios or with indies?

SD: With the studios. They’ve got the biggest volume. Majors will often have seven or eight things, whereas indies might only have one or two. But we do make time for other, smaller distributors while we’re in L.A.

VAI: How will the financial crisis affect the Screenings?

SD: People will have less money to spend on things, of course. But in the end, that might make for fiercer competition. Whereas in the past you might have bought two or three shows, now you may only buy one, but you’ll be prepared to spend more for it.

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By Leah Hochbaum Rosner

With the annual Los Angeles Screenings approaching, international television executives are busy readying themselves and their slates for what they hope will be a productive and prosperous market — the economy notwithstanding. Armando Nuñez, Jr., president of CBS Paramount International Television gave VideoAge a candid studio perspective, with insight into attendance numbers, the seemingly sudden disappearance of parties, and what industry folks really think about having to work through Memorial Day, one of America’s most revered holidays.

VideoAge International: How many buyers are you expecting at the studios’ Screenings this year? How does this compare with last year? Why are numbers up or down?

Armando Nuñez: While all of our clients will be in attendance as in previous years, there may be fewer executives attending from each group. The overall attendance numbers may be lower, but not by a significant amount.

VAI: Why are there so few studio parties this year?

AN: There have been fewer studio parties in recent years, not just this year. We did away with the annual concept of parties years ago but continue to engage our clients on a smaller, more targeted basis.

VAI: Are you satisfied with the new crop of pilots this year? Do you want to see more of any particular genre? Is there any one pilot you’re betting on?

AN: As one of the most successful and prolific studios in the business we are always excited with our development slate and pilots for both dramas and comedies. The studio is already betting on all of its pilots by making the type of financial investment required.

VAI: What are your thoughts about working through the Memorial Day holiday? Will this help or hurt business?

AN: As our international clients are already scheduled to be in Los Angeles that weekend, we made a strategic decision to screen on and during Memorial Day weekend. I don’t think it will have any impact one way or the other.

VAI: Do you expect buyers to purchase more finished product since many places are cutting back on local production? Are you expecting prices to stay the same or change? Will they be higher or lower?

AN: Our buyers are savvy and they will license programming that they feel will work in their territory and that they can sell to advertisers. Generally speaking, acquisitions are more cost efficient than local production, which may present some opportunities for us, but it is very much territory dependent. Pricing will vary according to territory and program, but we always want higher pricing.

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