Int’l Cash Cow On Critical List For Syndies

The international market for action hours, usually the cash cow that covers U.S. deficits for syndicators, is getting more competitive, which is bad news for U.S. syndicators facing a tough domestic market.

Without the international market, most of the hit shows in firstrun syndication-such as All American Television’s “Bay-watch”-never would have succeeded. Revenues from abroad allowed syndicators to keep production on shows going while they searched for an audience here.

“Without the overseas market, ‘ Baywatch’ would have never gotten off the ground,” said Larry Lamattina, president and CEO, All American Television.

Now, though, local production quotas and the flood of shows in the market are driving prices downward, which has many concerned. Also, American shows are not as prevalent in primetime as they once were. American product is usually run on weekends or in fringe time periods.

“American shows are disapearing in the primetime lineups of many of the major European broadcasters,” says Colin Davis, president, MCA TV Intl. “I don’t think you can look at the international market as the cash cow to cover U.S. deficits.” The shows are fewer, he adds, not only because of quotas but also in part because “these European networks are developing their own product that they feel can get better audiences than they could with American product.”

MCA, Davis says, is producing product that should have international appeal but the prices are not going up.

“I just came back from Mip Asia where someone was offering us all of China with unlimited runs for $1,000 per hour. That is nonsense. Where is the future growth?” Davis asked.

While Asia will be one of the fastest growing markets in terms of TV households, it will not necessarily translate into strong license fees for American products. Both cable operators and programmers doing business there do not expect a return on their investments anytime in the near future. Operators will have their own start-up costs to consider before looking to spend heavily on programming.

Although cable and satellite operators are also launching new channels, they are not yet in a position to pay top dollar for product. Cable and satellite is likely the next big growth area overseas, as not too many U.S. execs are banking on new private over-the-air channels launching in the near future.

“We must depend on the big stations such as TF1 in France. That is where the money is coming from. The smaller players are not in that position nor do they have to be,” said All American’s Lamattina. “The trend around the world is locally produced programming.

“Our leg up,” he added,”is that we have locally produced gameshows around the world.”

Besides the drive for more locally produced programming, the international market is also being oversaturated with action hours and drama much like the U.S. ABC, CBS and NBC, which had gotten out of the hourlong biz a few years ago, have returned with a vengeance and those shows are also glutting the market.

While some in the programming industry wonder if the tightening of the international market will have an adverse effect domestically, Warner Bros. Domestic Television Distribution senior vice president Scott Carlin does not think that is the case.

“The marketplace is tighter, there is no question about that,” he says. “But it is still a quite robust market and the tightening has not had any material negative effect to generate license fees outside the U.S.”

If the market tightens sufficiently there could be an impact here that would result in fewer action hours being produced.

To ensure clearances for their shows abroad, many of the studios are now packaging much of their action shows on the backs of their films.

A plus for the syndicators is that action shows seem to have a longer life span abroad than they do domestically.

“We are still getting excellent revenue from reruns of old car crash shows such as the ‘ A-Team.’ That is a major part of our income,” said MC A’s Davis.

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Leave a Reply

No Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More News from Variety