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Jury out on online TV rights transactions

InternetStudios.com among first in line

HOLLYWOOD – One of a clutch of companies trying to establish an online television market, InternetStudios.com is banking on what everyone agrees is the biggest gamble of all: using the Internet to conduct transactions, something most buyers at this point are inclined to do by traditional means.

“I don’t see how transactions will work,” says Laurie Woodrow, senior vice president at Trans-Pacific, which represents European and Asian buyers. “Sales companies are resistant to giving their information to a third-party Internet service when they can give it directly to buyers.”

But Robert MacLean, Internet Studios chairman, stands behind his company’s prospects with a impressive optimism.

“The need to do more volume business and simplify the time spent on these transactions will change sales people’s attitudes,” he says. “We won’t replace the markets, but be a friend of the markets, given the fragmentation with all the media available in the new convergence area.”

MacLean’s is the only company claiming to be already doing transactions, but he’s not ready to reveal specifics, saying, “There are sales and we will be making an announcement soon.”

While others haven’t ruled out creating a transaction model, they’re opting to cast their lot with other services first. The main offerings, whether singly or in combination, are: a database of program listings, customized Web sites for distributors, and downloadable marketing materials from trailers to press kits. What will take root, forming a part of the normal way of doing business, remains an open question.

“These dot-coms are all striving to provide additional value-added service, but up to this point my clients aren’t really using them,” says Rob Aft, president of international distribution at Kushner-Locke. “I’m hoping at Mipcom I’ll have lots of clients come up to me and say, ‘Hey, I checked out your movies online and I’d like to buy this.’ I don’t know if that’s going to happen; I hope so.”

To a great extent, the online companies are trying to create a need for their services by simplifying rather than changing current practice. But for every need they satisfy, several companies are offering the same service — an oversupply that is bound to lead to consolidation.

“There’s definitely going to be a shake-out,” says Woodrow.

The process has already begun. In April, Internet Studios acquired ItsTV.com to strengthen its presence in the television market. Ultimately, insiders expect the field will be reduced to some three or four firms, of which Mipinteractive is likely to be one, since the Reed Midem-owned company sponsors the Mip and Mipcom markets, giving it a built-in synergy. The others are hoping to outlast the competition by staking out different types of services.

Tivix.com is focusing on materials delivery, charging a distributor an annual fee to digitize all marketing and press content, and post it on a Web site that can be downloaded at anytime with a PIN code.

“I see this as a marketing/service business,” says Renee Madrigal, the company’s senior veep of marketing. “We’re eliminating the time and cost of delivering materials.”

The company has formed alliances with Carsey-Werner to provide materials for “Third Rock From the Sun” domestically and with Bell-Phillips for “The Bold and the Beautiful” internationally.

TVResources.com, which builds customized Web sites for distributors for a fee, plans to announce its move into the materials-delivery arena at Mipcom.

ReelPlay.com, on the other hand, which offers distributors free posting of marketing materials and product information, will rely on banner advertising for its revenues.

“Our main focus is to aggregate eyeballs,” says Rachel Shapiro, VP for marketing and creative affairs. “We’ll be offering other services, too, but we’re not ready to announce them yet.”

In the meantime, programming buyers and sellers say the jury is out on what role these companies will play — but a judgment is expected soon.

“I think we’ll get our answer in the next two market cycles,” says Aft. “If clients are not using these services by then, it will be time to reevaluate their value.”

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