AMSTERDAM — European channel launcher SBS Broadcasting has inked a deal with News Corp.-owned Fox World to create and operate a northern European production company.
Company, at press time still unnamed, will churn out format-based and other entertainment programs for Scandinavia, Dutch-speaking Belgium and Holland, Central Europe and Switzerland.
SBS chief operating officer Markus Tellenbach told Daily Variety that the new company would be a major plank in SBS’ new multiplatform content strategy, “allowing us to play format production in all directions, whether it be an idea inspired by a U.S. or European hit.”
The 50/50 venture will be managed by a board of Fox and SBS execs, including Tellenbach and Grant.
The all stock transaction gives News Corp. one of the largest stakes in SBS.
Tempting new auds
As part of the pact, SBS will commission the new company to deliver 13 episodes of at least three local versions of Fox’s U.S. hit “Temptation Island” for its channels in the territories to which the new company is targeted.
Fox World is the international production arm of Fox Television Studios, a subsid of the Fox Entertainment Group. News Corp. Fox Television Studios president David Grant said that given its strong youth profile, SBS is “the kind of partner Fox World is looking for.”
Grant cautioned that the deal was specific to Scandinavia, Belgium, the Netherlands, Switzerland and Central Europe and is non-exclusive. “This new venture will work for anyone and everyone” in those territories, he added.
At press time the headquarters of the new company had also not been decided, although SBS’ greatest ties with Fox are in Holland, SBS’ largest revenue churning territory.
SBS is in the final stages of due diligence to acquire a 50% stake in News Corp.’s TV10, the holding company for Dutch channel Fox 8.
RTL competish key
While the need to ensure content for multiplatform revenue streams was a prime mover for the creation of the new company, the competitive pressure from the Bertelsmann-owned RTL Group is also a key factor.
The merger of the U.K.’s Pearson TV and CLT/Ufa last year created the RTL Group, now one of the richest content banks in the world and SBS’ rival in several broadcast territories.
SBS estimates it could spend as much as $800 million on local production in the next five years, and wants half of that to be turned into a rights library that will feed multiplatform revenue streams.
SBS already has 50% ownership in a several formats with Endemol Entertainment and is in co-production with Nordisk Film TV on a format called “71 Degrees North.”