Broadcast Distributors Survey 2013 by Media Business Insight

B Distributors Survey 20I3

British distributors have posted a stellar set of results in the 2013 Broadcast Distributors Survey. Seemingly immune to the fragile state of the global economy, they generated revenues of approximately £1.1bn, up almost 10% year on year. As in recent years, results were especially impressive at the top end. The biggest five companies accounted for £833.6m of the total, or threequarters; that’s 10% up on last year’s £757m. The biggest contributors to growth were Endemol Worldwide Distribution (EWD) and Shine International, whose revenues were up by 27.6% and 31.1% respectively. Shine’s growth surge takes it into the top five for the first time. In terms of headline figures, BBC Worldwide continues to dominate and has now smashed through the £300m mark. With revenues of £312.3m, it is comfortably bigger than combined revenues for the rest of table from Zodiak Rights (in sixth place) down. BBCW president, global markets, Paul Dempsey says this record-breaking performance is due mainly to the strength and quality of the company’s content pipeline, which consists of both BBC and indie shows (BBCW currently has 37 first-look or output deals with indies). “But the content doesn’t sell itself,” he says. “We are well-organised around the world and have great connections with our established customers. We’re also very good at finding new ways of distributing content to audiences.” Fremantle Media International, which replaces Fremantle Media Enterprises in our table, also had a landmark year: revenues were up by 9.7% to £209.4m. Like BBC Worldwide, FMI has just undergone a fundamental reorganisation in both structure and senior management, ssoo it will be interesting to see what difference that makes in 2014. ITV Studios S tudios Global Entertainment has already been through a corporate resstructure tructure and the benefits of that seem to be starting to show after a relatively soft performance in 2012. This year, ITVS GE revenues sstand tand at £136.5m, a rise of 6.8%. For managing director Maria Kyriacou, K yriacou, that’s an endorsement of the company’s aggressive investment in quality content: “We have a really strong slate of drama at a time when there seems to be more drama buyers than ever. And we’re also seeing continued demand for our entertainment and factual entertainment programming.” If anything, she continues, the situation should be even better The definitive report on the UK distribution sector

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Contents Leader 4

A platform for growth UK distributors had a great year in 2012/13 and are on course to repeat that in 2013/14. Growing demand from DTT channels, on-demand platforms and broadcasters in emerging markets has boosted their combined revenues by 10% to around £1.1bn. The bigger companies in our survey have done particularly well, thanks to the scale and quality of their catalogues. But there’s plenty of evidence that the market has room for specialist companies operating in the £1m-£10m revenue range. We even saw the launch of two new companies: Twofour International and TCB. The big money in distribution seems to go be going towards two types of content. The first is primetime event programming that can help a broadcaster’s schedule stand out; the second is long-running factual and entertainment franchises that can provide the spine of a network schedule. Distributors that have two or three versions of such shows are uniquely well placed – particularly if one of those versions emanates from the US. British content has always been popular with buyers because of its high quality. But it’s noticeable that UK drama (Luther, Broadchurch and many others) did particularly well last year. In the past, the UK’s shorterrun serials sometimes struggled to capture the attention of buyers. But two things have changed. First, they are doing well in the on-demand space, because audiences like to binge view them in one or two sittings. Second, US cable channels are seeing an opportunity to take UK miniseries and convert them into longer-run series for their own market. This then creates a US product for the international market that can give a marketing boost to the original UK version. Most of our companies are confident about the future. But that hasn’t prevented a lot of internal reorganisation across the industry. With new bosses, new corporate brands, new sales teams and a flurry of merger and acquisition activity, it will be interesting to see the shape of the sector after the dust settles. ➤ Andy Fry, supplement editor

Contents 4 Overview Combined revenues for the sector rise to £1.1bn in another strong year for UK distributors. 13 Trends British drama is on the up, while digital platforms are becoming an increasingly significant source of revenues. 16 Peer Poll With revenues hitting more than £50m, Shine International comes out on top in our peer poll for the first time.

A note on methodology To be included in the survey, companies need to be key players in the UK distribution market, selling their own or third-party product. They must be UK-based or with a sales team based in the UK. Companies must state distribution financial turnover in their responses. Participants are ranked based on distribution turnover for the year to April 2013 or their latest financial year. Our thanks to all the companies that took part this year. If you’d like to be included next year, email robin.parker@emap.com

Broadcast Editor Lisa Campbell Supplement Editor Andy Fry Features Editor Robin Parker Production Editor Dominic Needham Group Art Director, Media Peter Gingell Senior Commercial Director, Media Alison Pitchford Deputy Sales Manager Sonya Jacobs www.broadcastnow.co.uk

20 September 2013 | Broadcast | 3

Distributors 2013 Overview

Going from

strength to strength

In another bumper year for British distributors, revenues increased to £1.1bn, with figures for the five biggest players alone up a combined 10% on last year. Andy Fry examines the data

ritish distributors have posted a stellar set of results in the 2013 Broadcast Distributors Survey. Seemingly immune to the fragile state of the global economy, they generated revenues of approximately £1.1bn, up almost 10% year on year. As in recent years, results are especially impressive at the top end. The biggest five companies accounted for £833.6m of the total, or three-quarters; that’s 10% up on last year’s £757m. The biggest contributors to growth were Endemol Worldwide Distribution (EWD) and Shine International, whose revenues are up by 27.6% and 31.1% respectively. Shine’s growth surge takes it into the top five for the first time.

most profitable Company

BBCW Passion Distribution Content Media Beyond Distribution TVF International 3DD Entertainment

Profit

£79.3m £4.4m £4m £1.75m £650,000 £238,000

Note Table only includes companies that revealed profits

Luther (BBCW) 4 | Broadcast | 20 September 2013

‘The content doesn’t sell itself. We are well organised around the world and have great connections with our established customers’ Paul Dempsey, BBCW

In terms of headline figures, BBC Worldwide continues to dominate and has now smashed through the £300m mark. Its revenues of £312.3m are comfortably bigger than the combined total for the rest of the table from Zodiak Rights (in sixth place) down. BBCW president, global markets, Paul Dempsey says this record-breaking performance is mainly due to the strength and quality of the company’s content pipeline, which consists of both BBC and indie shows (BBCW currently has 37 first-look or output deals with indies). “But the content doesn’t sell itself,” he says. “We are well organised around the world and have great connections with our established customers. We’re also very good at finding new ways of distributing content to audiences.” Fremantle Media International, which replaces Fremantle Media Enterprises in our table, has also had a landmark year: revenues are up by 9.7% to £209.4m. Like BBCW, FMI has just undergone a fundamental reorganisation in both structure and

The Returned (Zodiak Rights)

£834m The revenue generated by the top five companies in the survey, up 10% from last year’s figure of £757m

senior management, but we will have to for next year’s survey to see what difference that makes to its figures. ITV Studios Global Entertainment has already been through a corporate restructure and the benefits of that seem to be starting to show after a relatively soft performance in 2012. This year, ITVS GE revenues stand at £136.5m, a rise of 6.8%. For managing director Maria Kyriacou, that’s an endorsement of the company’s aggressive investment in quality content: “We have a really strong slate of drama at a time when there seems to be more drama buyers than ever. And we’re also seeing continued demand for our entertainment and factual entertainment programming.” ➤

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THE UK’S TOP DISTRIBUTORS Company

Distribution turnover to April 2013

% change

Pre-tax profit to April 2013

Value of international prog sales to April 2013

Value of domestic prog sales to April 2013

Top-selling programmes include

Hours of programming in catalogue

% of catalogue from third-party producers

BBC Worldwide

£312.3m

£293m

6.6%

£79.3m

£236.4m

£75.9m

Doctor Who; Top Gear; Luther

50,000

27%

Fremantle Media International1

£209.4m

£190.9m

9.7%

n/a

£138.1m

£71.3m

American Idol, X Factor USA; Jamie’s 15 Minute Meals

20,000

75%

ITV Studios Global Entertainment1

£136.5m

£127.8m

6.8%

n/a

£104.7m

£31.8m

Titanic; Prime Suspect USA; Come Dine With Me

40,000

45%

Endemol Worldwide

£116.4m

£91.2m

27.6%

n/a

Extreme Makeover; Hot In Cleveland; Home & Away

29,000

50%

Shine International

£59m

£45m

31.1%

n/a

£56.3m

£2.7m

Broadchurch; The Bridge; MasterChef

4,410

41%

Zodiak Rights1

£53m

£54.2m

-2.2%

n/a

£50m

£3m

SYTYCD?; Being Human; Embarrassing Bodies; The Returned

17,000

60%

All3Media International3

£47m

£41.7m

12.7%

n/a

£41.8m

£5.2m

Midsomer Murders; Undercover Boss; Skins

6,500

15%

Cineflix Rights2

£41.5m

£36.35m

14.1%

n/a

£39.7m

£1.8m

Weird Or What?; Driving Wars; Mayday

3,400

50%

Digital Rights Group

£23.3m

£25.5m

-8.6%

n/a

£18.7m

£4.6m

The Inbetweeners USA; Doc Martin; Never Ever Do This…

11,400

100%

Passion Distribution

£22m

£15m

46.7%

£4.4m

£20.7m

£1.3m

Klondike Gold Fever; Prospectors; Oscar Pistorius doc

7,250

85%

Content Media

£17.5m

£17.6m

-0.6%

£4m

£16.1m

£1.4m

Halo 4; Forward Unto Dawn; The Fall; Bletchley Circle

3,900

40%

Beyond Distribution

£13.6m

£12.5m

8.8%

£1.8m

£12.5m

£1.1m

Mythbusters; Highway Thru Hell; Love It Or List It

4,000

60%

Electric Sky2

£10.9m

£10.7m

1.9%

n/a

£8.1m

£2.8m

Safari; Sex Clinic; A Place In The Sun

2,000

100%

Optomen Television

£9.8m

£8.1m

20.8%

n/a

£8.3m

£1.5m

Kitchen Nightmares US; Hotel Hell; Worst Cooks In US

1,800

DCD Rights

£8.3m

£8.1m

1.9%

n/a

£7.2m

£1.1m

The Slap; Bridezillas; Rake

1,500

75%

TVF International

£7.7m

£7m

10%

£650,000

£7.3m

£450,000

The Real Sherlock Holmes; The Real Inglorious Bastards

1,500

95%

Hat Trick International

£4.9m

£4.3m

16%

n/a

£4.2m

£780,000

Episodes; Dinner Date; James May’s Man Lab

599

38%

Power Corp International

£3.9m

n/a

-£1.1m

£3.8m

£89,000

Air Force One Is Down; Blackout; Dragon’s Feast

1,260

90%

Twofour International

£3.2m

n/a

£2.5m

£700,000

Born To Kill; Storage Hoarders; Hotel Inspector

395

3DD Entertainment

£3.1m

£4.5m

-30%

£238,000

£2.8m

£250,000

London Live; Pop Profiles; Discovering Music

650

TCB Media

£2.2m

n/a

Surveillance; World’s Busiest; Animal Airport

150

100%

Argonon International1

£1m

n/a

£800,000

£200,000

Baby With A New Face; Tourettes: Let Me Entertain You; Cash In The Attic

2,000

20%

DLT Entertainment1

£750,000

£1.3m

-42%

n/a

£200,000

£550,000

My Family; As Time Goes By; Three’s Company

900

70%

Notes All figures are for year ended 31 March 2013 unless otherwise stated. n/a refers to an entry where figures were not provided. 1. Turnover for Argonon International, DLT Entertainment, FMI, ITVS GE and Zodiak Rights is to 31 December 2012 (previous year figure is to 31 December 2011) 2. Turnover for Cineflix Rights, and Electric Sky is to 30 September 2012 (previous year figure is to 30 September 2011) 3. All3Media International turnover is to 31 August 2013 (previous year figure is to 31 August 2012)

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20 September 2013 | Broadcast | 5

Distributors 2013 Overview ARE YOU MORE CONFIDENT THAN LAST YEAR? 1% 13%

86%

Yes

Same

If anything, she continues, the situation should be even better by the time of next year’s survey: “These figures don’t include the success we’ve been having with Mr Selfridge, which is now in 100 territories, and Rectify. There’s also a lot more to come from our relationships with producers like Big Talk, The Garden [acquired by ITV this year] and Ruby, which renewed its distribution relationship with ITVS GE in April.”

£3.2m The amount that Twofour Group’s new international division generated in its first year

EWD continues to close the gap on ITVS GE, an emphatic endorsement of the decision to put Cathy Payne in charge back in 2009. Commenting on the company’s growth, Payne says: “Endemol always had great content but now we’ve taken distribution to a serious level within the group. The key to maximising the value of our IP is that we’re well organised.” Shine International chief executive Nadine Nohr puts her company’s impressive showing down to two factors. “First, we have strong factual franchises like MasterChef and 24 Hours In A&E. When times are tough, buyers go in search of track record and pedigree. Second, there was the decision to diversify into drama. Broadchurch and The Bridge have been fantastic shows for us, the latter being distributed in around 120 countries.” Outside the top five, results are more mixed but positive overall. Zodiak Rights, Digital Rights Group 6 | Broadcast | 20 September 2013

24 Hours In A&E (Shine International)

and Content Media have all suffered slight dips in revenue, but All3Media International and Cineflix Rights have both recorded double-digit growth. Cineflix, with revenues of £41.5 m, has proved it is possible to break out of the middle of the table and mix it with the big players. “What you’re seeing in these numbers is continued strength in our core factual business, with titles like Mayday well supported by our property and crime shows,” says Cineflix Rights chief executive Chris Bonney. “We’re also starting to see revenues coming through from our scripted shows, and from a representation deal we did with US factual producer LMNO, which added an additional 400 hours to our catalogue.” Next year, predicts Bonney, the headline numbers will include a contribution from the company’s increased activity around UK factual content. “We’re making great strides in our BBC, Channel 4 and Channel 5 business. But series like Trauma

‘i’ve been surprised by how much quality content there is. i still expect to bring around 10-15 new series to mipcom’ Paul Heaney, TCB

biGGesT iNCrease iN reVeNUe Company

Passion Distribution Shine International EWD Optomen Hat Trick International Cineﬂix All3Media Int'l

% change

Revenue 2013

46.7% 31.1% 27.6% 20.8% 16.0% 14.1% 12.7%

£22m £59m £116.4m £9.785m £4.93m £41.5m £47m

Revenue 2012

£15m £45m £91.2m £8.1m £4.25m £36.35m £41.7m

Top iNVesTors iN DeVelopmeNT Company

DRG FME Passion BBCW Zodiak Cineflix

Total annual spend

£3.5m £3m £3m £2m £1.5m £500,000

Doctors and Salvage Hunters don’t yet show in our numbers.” There have been some quite profound developments in the middle of the field in terms of ownership, notably BSkyB’s acquisition of Parthenon to create Sky Vision; Scandinavian media giant Modern Times Group’s purchase of DRG and superindie Tinopolis’s acquisition of Passion Distribution. It is not yet possible to measure the progress of Sky Vision because the company doesn’t have a full year of operation under its belt. However, DRG was able to report a revenue figure of £23.3m, down 8.6% on the previous year. DRG chief executive and cofounder Jeremy Fox is not unduly concerned; that dip, he says, came at a time of great uncertainty for DRG. Fox himself left the company in September 2012 and only returned when MTG acquired the business from Ingenious Media Active Capital in June 2013. “The business plateaued last year because there was a sales process going on. But now things are back ➤ www.broadcastnow.co.uk

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Distributors 2013 OVERVIEW MOST NON-UK CONTENT IN CATALOGUE Company

% of catalogue content

Cineflix Rights Powercorp Beyond Content EWD FME DLT Entertainment

85% 85% 80% 75% 70% 70% 65%

Hours of catalogue content

2,890 1,071 3,200 2,925 20,300 14,000 585

MOST UK CONTENT IN CATALOGUE Company

% of catalogue content

Hat Trick International Twofour 3DD BBC Worldwide Optomen All3Media International Argonon TCB Zodiak

100% 100% 98% 98% 95% 89% 85% 85% 80%

ARE YOU CONCERNED ABOUT CONTINUED VOLATILITY?

25%

75%

Yes

Hours of catalogue content

599 395 637 49,000 1,710 5,785 1,700 127.5 13,600

‘The key for us is to be big enough to warrant respect from buyers but not so big that we spread ourselves too thin’ Sarah Tong, Hat Trick International

on track,” he says. “We belong to a business that really understands what distribution is about and is able to supply us with a bigger warchest when it comes to acquiring content.” One obvious question is how broadcaster ownership will affect DRG’s much-vaunted independence. “It won’t,” says Fox. “Independence is crucial to the way we do business and MTG realises that. DRG started life as

Born To Kill (Twofour)

a distributor, not a production company, and that still guides the way we do business.” While DRG regroups, Passion Distribution continues to expand. Bolstered by the absorption of Tinopolis-owned Mentorn International, Passion now quotes revenues of £22m. This is a rise of 46.7% on 2012 and makes the company the fastest-growing distributor of the year. Remarkably, given that it only launched in 2008, the company has also broken into the top 10. Further down the table, stalwarts Optomen, TVF International and Hat Trick International have all recorded rises of 10-20% – proof, if needed, that there is room in the market for boutique distributors specialising in specific genres. Optomen, for example, is generating just under £10m a year with a portfolio almost exclusively based around food shows. Hat Trick, meanwhile, is primarily about comedy and entertainment – and has been doing well with third-party content from

Plum Pictures and Keo Films. “We’re not trying to be a big distributor,” says Hat Trick International managing director Sarah Tong. “The key for us is to be big enough to warrant respect from buyers, but not so big that we

£79.3m Profits for the year for the survey’s table-topper BBC Worldwide – up from £72.3m in 2012

spread ourselves too thin and can’t service our content. At our current size – 599 hours – we know everything we’ve got in our catalogue.” More positive indicators are the resurgence of Power Corp International and the launch of two new distributors. Twofour International’s strong first-year results demonstrate that distributing your own shows is ➤

MOST RELIANT ON THIRD-PARTY PRODUCER CONTENT Company

DRG Electric Sky TCB TVF Power Passion

% of catalogue content

100% 100% 100% 95% 90% 85%

8 | Broadcast | 20 September 2013

Hours of catalogue content

11,400 2,000 150 1,425 1,134 6,162.5

Mayday (Cineflix) www.broadcastnow.co.uk

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Distributors 2013 OVERVIEW MOST GROWTH IN MARKETS BY COUNTRY 3.2%

12.4% 21.5%

4% 4% 11.6%

4.8% 4.8% 5.6% 6.5%

11.2% 10%

China

Russia

Brazil

Poland

India

Pan-Asia

Pan-LatAm

Pan-Europe

Middle East Korea

Pan Africa Other

a legitimate option for indies. Likewise, a good debut for Paul Heaney’s TCB Media shows there is plenty of quality, saleable content around if you know where to look. Twofour Group commercial director Anthony Hughes is delighted with the £3.2m that has been generated by the international division in its first year, thanks to titles like Storage Hoarders and Born To Kill, which has been sold to 78 territories. But why did it make sense to go it alone?

9.7%

The increase in revenues at Fremantle Media International following a reorganisation “Three reasons,” he says. “First, representing your own content means that every hour of programming gets as much attention as it merits. There’s no risk of it being lost in a bigger distributor’s catalogue. Second, it’s an opportunity to promote the Twofour brand, particularly in the US, which is a key target market for us. And third, we felt it would be a way to feed back information from buyers that might benefit our development slate.” So would he advise other indies to go the same way? “That depends on their content pipeline. We’ve got to a position where we have enough volume of quality shows coming through that we can sustain this kind www.broadcastnow.co.uk

The Bridge US (Shine International)

of operation – and the rights to shows like Hotel Inspector have started to revert to us. Even so, we had to hold back a number of rights from the market so we were able to create an impactful launch.” While the distributors in our table are happy to share their revenue figures, most are shy about revealing profits, so praise must be reserved for those that do. BBCW, as usual, leads the way, with profits of £79.3m. But there are also decent profit margins at Passion, Content Media, Beyond, TVF International and 3DD Entertainment. Content has increased profits slightly at a time when its sales were slightly down, suggesting an efficient use of its resources. So why is the picture still so healthy when the wider economic situation is so volatile? Part of the explanation is that demand for content continues to be robust in markets where British distributors have traditionally been strong. As in previous years, the distributors name Australia, New Zealand, the US, the UK, the Nordic region and Canada as key markets. At the same time, they are taking advantage of growing demand in emerging markets. China is the top growth market for the second year running, thanks to the increasing openness of its regional TV networks and the emergence of digital platforms. As a consequence, Chinese public broadcaster CCTV has become more open to engagement, as illustrated by a series of co-production deals between BBCW and CCTV-9.

‘Broadchurch and The Bridge have been fantastic shows for us. The latter is distributed in around 120 countries’ Nadine Nohr, Shine International

British distributors are making inroads into Russia, Poland, Brazil, India, the Middle East and Korea too. There is also increased activity in panregional networks in Latin America, Eastern Europe, Asia and, encouragingly, Africa. British distributors are upbeat: 86% are more confident than they were this time last year. Zodiak Rights chief executive Matthew Frank and Cineflix’s Bonney are among those who believe trading conditions are looking more favourable for the year ahead. Having said that, they aren’t getting carried away: 75% of our distributors remain concerned about the volatility of the global economy. One comment sums up the mood: “Everyone is watching the euro and we expect it will be some time before we see recovery in Spain, Italy and Greece. We will always be prudent with business dealings in markets that have historical economical volatility, such as Africa, Latin America and parts of Central and Eastern Europe.” There are concerns about content supply, with one distributor citing “a poor season of product from the US studios in 2012. The importance of owning IP has never been greater as everyone competes to obtain product.” This comment suggests that the market is skewed in favour of the bigger companies, most of which are part of groups that own indies or are willing to bankroll first-look and development deals. But TCB’s Heaney, who opened his company for business this time last year, says there is good content for small distributors if they know where to look and have the right contacts to clinch sales: “I’ve been surprised by how much quality content there is. I’ve been selective but still expect to bring around 10-15 new series to Mipcom this year.” Like many of his peers, Heaney has had success securing rights from markets including Australia (Seven Network’s Surveillance) and New Zealand (2B Media’s Rescue Code One). But he has also seen opportunities closer to home: “The reality is that new indies are popping up all the time as producers and commissioners set up on their own. At the same time, I get the impression that indies aren’t always comfortable with the terms of distribution advances. Sometimes, I can help them raise their production budget through pre-sales, enabling them to keep more territory rights than if they took a cash advance.” 20 September 2013 | Broadcast | 11

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Distributors 2013 Trends

Platforms flex their muscles Leading distributors from BBCW to FMI and Shine International have been restructuring their businesses as digital players become an increasingly significant force. Andy Fry reports

f there’s one very visible trend in the UK distribution sector, it’s that most of the major players have been through internal upheaval. BBC Worldwide, Fremantle Media Inter national and Shine International all have new management; Zodiak, Cineflix, DRG and Sky Vision have recently reorganised; while ITVS Global Entertainment and Endemol Worldwide Distribution (EWD) are only two or three years into new-look distribution set-ups. The reasons for this upheaval vary from company to company, but many of the key drivers are summed up by BBCW: “We have reorganised our selves to ensure we are in the most powerful positions in our markets. We are also investing in emerging markets to ensure we can capture future growth; taking an increasingly sophisticated approach to windowing to extract maximum value; and seeking out new clients and sales avenues, particularly with digital players.” BBCW president, global markets, Paul Dempsey says the key shift is away from divisional lines of manage ment, such as sales, channels and con sumer products, towards geographic lines of management. “We are better positioned to max imise the value of our content across windows and we’re more focused on driving growth in emerging markets. None of this means we are reducing our commitment to particular areas of the business; it’s just a more sophisti cated way of managing our brands.” Maximising brand value was also cited as a key rationale for the restruc ture at Fremantle Media, where com mercial division FME was disbanded earlier this year. In the new set-up, licensing, sponsorship and digital have moved closer to production, while Fremantle Media International has been created to focus on distribution. Brand management is a recurring theme. “If you really want to maximise the value of your intellectual property, you have to make the right decisions for your brands,” says EWD chief executive Cathy Payne, whose www.broadcastnow.co.uk

The Fall (Content Media): drama is selling well

company continues to do well with Extreme Makeover, Hot In Cleveland, Home & Away and Wipeout. “You don’t want to over-sell or overexpose them, because you’re looking to maintain the long-term value of the franchise. This is more of an issue now as there are so many digital plat forms looking to participate early in a show’s life.”

Digital growth Nevertheless, digital is growing in importance. While there are still com plaints about digital deals being complex and time-consuming, more than a third of our distributors now make 10-15% of their revenue from digital/video-on-demand players. All3Media International is one. Man aging director Louise Pedersen says: “This is the year when some of the VoD platforms have started paying mean ingful licence fees. We’ve shown that we’re taking this sector seriously by increasing the size of our digital team and hiring Gary Woolf from BBCW to become our senior vice-president of digital and business development.” Content Media is equally bullish. In its survey response, it says: “We are

‘Some platforms have started paying meaningful licence fees. We’re taking this sector seriously’ Louise Pedersen, All3Media International

seeing new distribution options for our programming as digital channels and outlets vie for first- and secondrun rights alongside traditional broadcasters. This shift helps to make the market more competitive, allow ing us to operate more sales windows.” The recent wave of restructuring isn’t just about selling content; it’s also about making sure companies are able to compete in content acquisition. EWD’s Payne says: “More money is being spent on the big shows that define a channel. There is huge demand for product and some distrib utors are prepared to pay premium prices for content.” Zodiak Rights chief executive Matthew Frank echoes this: “We are concentrating on shows that will run in primetime when we acquire pro gramming for our catalogue. This is where the money is.” All3Media’s Pedersen sounds a similar note: “Competition for pro gramming is very intense. Rights are hard to get.” This explains a lot of the action in the middle of our league table. Under new owners, Sky Vision, DRG and Passion all have greater purchasing ➤ 20 September 2013 | Broadcast | 13

Distributors 2013 Trends

Secret State (All3Media): C4 drama did better than expected

TOP INVESTORS IN DEVELOPMENT Company

DRG FME Passion BBCW Zodiak Cineflix

power. So does DCD Media, thanks to a new tranche of investment from its majority shareholder Timeweave, which is itself owned by Joe Lewis’s Mayfair Capital Investments. “Timeweave has provided signifi cant funds for content acquisition in the past three years,” says DCD Rights chief executive Nicky Davies Williams. “In July 2012, it became our major shareholder, and then in October, it agreed a new investment fund with us. That enabled us to acquire series like Coast Guard Florida and Coast Guard Alaska. Going forward, it will allow us to expand our footprint in a more aggressive way than previously.” DCD has done well with nonUK titles in recent times; its top three titles last year were The Slap, Bridezillas and Rake. There’s no question that UK dis tributors are still keen on acquiring international content, mainly from Englishspeaking countries – though it’s worth noting that Zodiak, Endemol and All3Media all have IP from conti nental Europe in their catalogues. Homegrown drama has also been selling well. BBCW has had success with Doctor Who, Luther, Call The Midwife and Sherlock. ITVS GE has Titanic and Mr Selfridge. Being Human (Zodiak), Broadchurch (Shine), Midsomer Murders (All3Media Interna tional), Doc Martin (DRG) and The Fall (Content Media) all reinforce the appetite for UK content. 14 | Broadcast | 20 September 2013

Investment

£3.5m £3m £3m £2m £1.5m £500,000

‘The growth in digital and on-demand services is a great opportunity for us to exploit our catalogue’ Jamie Lynn, FMI

Shorterrun British serials no Strange & Mr Norrell and Death Comes longer seem such a handicap inter To Pemberly. nationally. Shine International chief For FMI, the biggest distributor executive Nadine Nohr, who has spent outside BBCW, drama reduces its reli many years selling quality British ance on entertainment franchises like drama, says: “There used to be a per American Idol and The X Factor. FMI ception among buyers that shorter chief finance officer and director of run series were difficult to schedule operations Bob McCourt says: “We’re and market. But in the era of on starting to see growth as a result of demand, audiences can store them up scripted series like The Wedding Band, and binge on them in one sitting.” Hit & Miss and Wentworth Prison [US, All3Media’s Pedersen confirms UK and Australian series respec this trend: “Quality drama has done tively]. But the real boost for us is really well for us in the past year. likely to come in 2014, when a lot of Some of the shorterrun pieces do US and UK scripted shows will start well. Secret State, a Channel 4 mini coming through.” series starring Gabriel Byrne, did FMI’s strength lies in its range of better than expected.” content, says Jamie Lynn, executive The new wave of buyers in the inter vicepresident, sales and distribution, national market (DTT, VoD and so on) EMEA. “We are in all genres and are forced to take greater risks in doing great business with lifestyle content acquisition because all of brands like Jamie Oliver. Setting the big programme fran up an office in Dubai has also chises are either tied up or had a direct impact on the too expensive. Everybody amount of business we needs exclusive content do in the Middle East.” Share of total to give their service an The scale of the FMI BBCW revenues air of distinctiveness, library is a prized asset. generated by digital and quality British “The growth in the platforms content attracts attention. number of digital chan One particular benefici nels and ondemand serv ary of this is BBCW, says ices is a great opportunity for us Dempsey: “New media platforms to exploit our catalogue. We still do want to differentiate themselves, great business with classic series like which is very positive for distributors Homicide: Life On The Street.” with worldclass catalogues. Around In terms of general trends, views 14% of our revenue is now coming vary depending on the size and status from digital platform deals.” of the company. One of our survey respondents complains: “The expan sion of cable channels across territo Creative ambition ries means that they require greater Finally, says ITVS GE managing global rights in their commissioning director Maria Kyriacou, there’s a deal, leaving fewer territories and much stronger tendency for broad rights for producers and distributors casters and distributors to back crea with which to recoup deficits and gen tive ambition: “We spend a lot of time with drama producers and writers and erate profit.” At the same time, another observes our message to them is to be ambi that DTT channel launches are creat tious. If they have a good idea about ing opportunities in key territories. cast or location, then we want them to Other areas where there is no clear go for it. I think they’ve really stepped pattern include genre diversification up and created great drama.” and corporate acquisition. Some see For all these reasons, scripted specialism as the way to survive; content, UKoriginated or not, has others are looking to diversify. become a big priority for most major Content Media’s catalogue has been distributors. Zodiak’s Frank says his bolstered by significant growth in company is increasing its investment in heavyhitting international dramas: hours of live and recorded sporting “We’ve had success with Being Human, events, including mixed martial arts. One firm sums up its concerns Braquo and The Returned, and are now by citing the “complexity of rights moving forward with Versailles, a big definitions, piracy, transition of period piece set in France, with home entertainment to digital and Canal+ as a major copro partner.” Payne says EWD is making “serious availability of suitable worldclass content”. Plenty to keep them busy investments” in drama with the likes for another year then. of Low Winter Sun, The Ark, Jonathan

14%

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Distributors 2013 Peer Poll

Now’s the time for Shine Shine International tops this year’s peer poll for the first time, beating the likes of BBCW and All3Media International in a good year for firms with a strong drama slate. Andy Fry reports Most of the big distributors in our survey don’t really classify themselves as ‘British’ any more, such is the international profile of their businesses. So it’s no surprise that they often quote non-UK companies as their most respected rivals. This year, for example, the likes of CBS, NBCU, Warner, HBO, Talpa and Red Arrow International all had their fans. That said, there was also support for some of the UK’s boutique players: DRG, Hat Trick, 3DD and Electric Sky. In the end, though, the most votes went to the following…

1. Shine International 15%

2. BBC Worldwide 14%

Shine International has come out on top of our peer poll for the first time ever, amid close competition from recent winners All3Media Inter national and BBC Worldwide. Shine’s success caps a year in which its revenues smashed through the £50m mark. In part, that’s down to the continued success of fran chises such as MasterChef, but it’s also the result of shrewd investment in Shine’s turnover scripted content. in 2013, smashing “Over the past 12 through the £50m months, we have signifi barrier for the first time cantly grown our scripted portfolio,” says Shine Inter national chief executive Nadine Nohr. “High-quality titles such as Broadchurch Broadchurch [ITV], The Bridge [FX], Vicious [ITV], In The Flesh [BBC3], The Sandhamn Murders [TV4] and Real Humans [SVT1] have all been performing incredibly well with our international buyers.” For Nohr, one of the real strengths of the Shine set-up is that it is geared up to produce and distribute different versions of the same show. “We dis tribute Shine America and FX Prod uctions’ US remake of The Bridge, which is fast becoming one of the channel’s biggest ever series. A UKFrench version, The Tunnel, will launch later in 2013, produced by Kudos and Shine France for Sky Atlantic and Canal+.” Equally exciting is the unfolding story with Broadchurch, which has been sold to more than 30 countries. Fox US is now making a US version, which will also be distributed by Africa Shine International.

£59m

16 | Broadcast | 20 September 2013

BBC Worldwide is always one of the top companies in our distribution peer poll. Rivals tend to describe it as “an awesome global machine” or applaud the work it does on behalf of UK producers (98% of its content is homegrown). This year, drama has been particu larly strong, with both long-running series and mini-series/serials per forming well. Also strong are factual franchises such as Top Gear and Africa, says BBCW president, global markets, Paul Dempsey. “Natural history continues to be a real com petitive advantage for us.” The range and depth of content in BBCW’s archive explains why the company has managed to keep growing, despite the tough global eco nomic conditions: “We’re not compla cent,” says Dempsey. “But the size of our catalogue makes us resilient and also positions us well to make the most of new opportunities. All the evidence suggests that people are watching more TV either via traditional plat forms or using new devices.” Dempsey talks about “extending the width of the content pipeline”. By this, he means adding to BBCW’s existing roster of in-house and indie prod Homegrown ucers. One way it could share of do this is by creating more BBC Worldwide’s content via local prod content uction hubs around the world, such as BBC World wide Productions in India. “It’s early days,” he says, “but I could envis age us creating more content for local markets and then exporting it to the rest of our international network.” ➤

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Distributors 2013 Peer Poll expected to deliver exportable ideas. Second is the size of its cata logue (40,000 hours) and its suit ability for exploitation across DTT and VoD platforms.

3. All3Media International 13% Four years in the top three (two of them at number one) underlines the high regard in which All3Media International is held by its industry peers. One fan of the company says: “We admire the way it has built from a relatively small indie to a very powerful company. It is an organic-growth success story.” All3Media International’s turn over figure of £47m is a 12.7% increase year on year. Part of that is explained by the company’s strong drama slate, says managing director Louise Pedersen: “The White Queen and The Village have both been big successes for us, as have Skins, Midsomer Murders, Inspector George Gently and Miss Fisher’s Murder Mysteries. We’re also doing extremely well with German scripted reality series from our sister company Filmpool. These sell in huge volumes to markets such as Russia and Poland.” All3Media International is celebrating its 10th birthday at Mipcom and has made most of its money in drama and factual entertainment franchises like Undercover Boss. But an exciting development for Mipcom is the launch of Studio Lambert’s The Million Second Quiz: “The show is one of NBC’s big autumn launches so we’re looking forward to showing it to buyers,” says Pedersen. “We’re also excited that Objective’s The Reflex is coming to BBC1. That’s another show we’ll be introducing to buyers in Cannes.”

4. Passion Distribution 7% Passion Distribution burst onto the scene five years ago and hasn’t stopped growing. Now a top 10 distributor, it is finally getting recogni-

Worst Drivers 18 | Broadcast | 20 September 2013

=5. Zodiak Rights 5%

Tree Fu Tom: FME pre-school franchise The White Queen

tion from its peers. One praises the company for its “energy and ambition”, adding that it is “well placed strategically following its acquisition by Tinopolis”. Explaining the decision to join forces with Tinopolis, Passion chief executive Sally Miles says: “Joining with Tinopolis gives us access to an internal pipeline of content from companies like Mentorn to go alongside the US relationships we’ve built up. Mentorn titles like Paradise Hotel, Worst Driver and World’s Scariest are all great additions.” Mentorn is also well known for fast-turnaround docs such as Buried Alive: The Chilean Mine Rescue, Oscar Pistorious: What Really Happened? and Captive In Cleveland. Passion managing director Nick Rees says the drive towards further growth will be helped by the company’s expanded sales team: “Distribution is increasingly complex because of the number of buyers at both traditional and digital channels. But the merger means our sales execs aren’t covering as many territories as before. That will bring greater focus.” Coming into Mipcom, Passion now has an almost 50-50 split between UK and non-UK content. Among its high-profile titles is Joe

Endeavour

Rogan Questions Everything, a series from US-based producer A Smith & Co, first broadcast on Syfy US.

=5. ITVS GE 6% ITV Studios Global Entertainment doesn’t usually feature high in our peer poll, but it clearly has some fans this year. That’s no real surprise given the renewed sense of purpose at the group. Revenues are rising and it is starting to make some really significant noises in drama. Aside from titles like Mr Selfridge and Rectify, referred to elsewhere in the survey, Endeavour has breathed life back into the Morse/ Lewis franchise, while Poirot continues to sell well. Outside of drama and factual entertainment, ITVS GE managing director Maria Kyriacou is seeing strong interest in gameshow The Chase. She’s also upbeat about Thunderbirds Are Go!, a reimagining of the classic kids’ series from ITV Studios and Pukeko Pictures. Kyriacou believes ITVS GE is well positioned for the future for two reasons. First, the company has important indie relationships with the likes of Ruby, Big Talk and The Garden – all of which are

Zodiak is well liked because of the quality of service it provides to independent producers. With 60% of its content coming from outside the group, it is still one of the biggest players when it comes to working with third-party content creators. It currently has 10 first-look or output deals with producers and spends around £1.5m on development each year. The big challenge in recent years for Zodiak Rights chief executive Matthew Frank has been knitting together a disparate set of interests. Alongside third-party business, parent group Zodiak owns a number of major producers across continental Europe He also needs to make sure he is getting the best out of his hubs in Paris and London. With this in mind, he has restructured his distribution activities so that scripted is now handled out of the Paris office and non-scripted and kids’ are handled out of London. “That provides us with a clearer structure and plays to the strengths within the group,” he explains. As outlined in the survey, drama is a big push for Zodiak right now – “but not at the expense of the well-oiled machine we have in non-scripted. That continues to be a big part of our business with titles like Embarrassing Bodies.” In entertainment, So You Think You Can Dance continues to be a top performer for Zodiak. Coming up to Mipcom, Frank also has high hopes for primetime entertainment format Versus.

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Distributors Survey 2013