Strike means new model of TV production

The writers strike was about far more than who gets what cut of Internet revenues.

For the strikers, that issue may have been the main prize. But for the network executives on the other side of the negotiations, the three-month ordeal had another, even more vital consequence.

In profound and permanent ways, the television business has changed since the writers declared pencils down. Network and media agency executives agree that the stoppage was the first line of an entirely new script for the television industry, one which, to borrow entertainment parlance, “reimagines” how TV has been developed, bought and sold for more 50 years.

“I’m surprised we made it this far with the current model of television development and production,” quips Alec Gerster, the highly respected, 30-year media agency veteran who retired as worldwide chairman of media services powerhouse Initiative at the end of March.

Clearly, one aftermath of the strike has been enormous: short-term pressure on the upfront, the famous annual media-business circus in which, each May, the networks roll out their schedules amid much fanfare and partying, and the process of buying and selling as much as 75%-85% of the coming season’s available commercial inventory gets under way. There’ll be dramatically less fanfare and considerably less partying this year, though.

Because the networks are still scrambling to produce new scripted shows, they simply don’t have anywhere near as much product as they normally do to present.

In fact, only half the usual 100-plus pilots have been commissioned. And the relentless takeover of the airwaves by reality television, also pumped up by the dearth of scripted fare, was only accelerated by the strike. Some of this is short-term strike fallout, but it’s also a harbinger of what’s to come in the TV biz.

New order

NBC was the first to make a big splash, when NBC U chief Jeff Zucker and his broadcast network’s entertainment heads, Ben Silverman and Marc Graboff, announced a series of changes that include an 18-month launch schedule, dramatically reduced number of pilots, a slew of reality shows, significantly muted presentation party and smaller, more intimate presentations to key clients and agencies.

That approach “makes far better sense than putting on a presentation before 5,000 people at Radio City Music Hall,” says media and strategy consultant Michael Kassan of Los Angeles-based MediaLink, who consults with many of the top media companies and agencies.

“I agree with Jeff Zucker that the strike allowed people to step back and take a very clear view of business models that were there just because they were there and which had been handed down from generation to generation,” Kassan adds. “The strike acted as a catalyst. And lo and behold, these high-seven-figure production and housekeeping deals and multimillion-dollar pilots and millions of dollars in canapes on Tavern on the Green upfront parties are all now being reconsidered in light of the new economics.”

Here’s how CBS Corp. president and CEO Les Moonves explained this revelation to analysts at a March media summit:

“We looked at what was good about the system, what was bad about the system. We realized there was excess cost put into the development process with … overall deals, where you hire a writer for a lot of money, you have an exclusive, and he sits and writes one script over the course of the year … we cut over 50% of those deals.

“We are not making nearly as many full pilots, where you can learn if you’ve got something or not, without having to spend 6, 7 million dollars on each one of those things. So I think our overall system became much more important and much smarter (in) how we do business.”

“There are so many changes coming out of the strike,” lamentedly agrees Chris Mills, literary manager at Magnet Management. “What NBC is doing — not ordering pilots, taking scripts straight to series, the strike’s disruption of production and staffing season — this is usually a great time to get your clients out there and get work, but that timing has been thrown off. And I think it is long-lasting. The development season we’re used to is thrown off because all the networks are changing the way they do business. Until we figure out what that is, there will be a lot of uncertainty and confusion.”

A final but perhaps just as significant trend that’s intensified because of the strike is product integration. Networks have turned to these partnerships with sponsors to defray production costs. Marketers are hoping the end of the strike, with its digital agreements, will encourage even more of them via webisode partnerships and the like.

“We all want to be as close as we can get to the content without infringing on creativity,” says Laura Caraccioli-Davis, exec VP and director of media shop Starcom Worldwide, and a 15-year veteran in developing branded entertainment programs that have brought together such couplings as Kellogg’s and Fox’s “American Idol,” Allstate and Discovery’s “It Takes a Thief,” and the U.S. Army and the History Channel’s presentation of “Band of Brothers.”

“There’s always been a Plexiglas that surrounds the creative community when it comes to talking to the advertising community,” Caraccioli-Davis adds. “That might have flipped with the strike.”

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