Steady cash flow, more buyers buoy biz
Warner Bros. Television prexy Bruce Rosenblum talked up the biz Wednesday, saying, “We are truly in a golden age, (with) more buyers creating more demand for more content.
“Television no longer refers to a box or a flat screen in your living room. When people talk about television, they mean content,” he told investors at the Barclays’ Global Technology, Media and Telecom Conference in Gotham.
Rosenblum noted that Time Warner’s TV operations — encompassing HBO, the Turner nets and Warner Bros. TV operations — generate the lion’s share of the conglom’s profit.
The division emerged from last week’s upfronts with nine new series pickups for next season. The eight dramas include J.J. Abrams’ “The Revolution” for NBC and “The Following,” with Kevin Bacon, for Fox. It also has 16 returning shows on the Big Four nets, where it’s been the leading supplier of shows for nine of the past 10 years, Rosenblum noted.
Warner Horizon Television is a major supplier to cable — including a remake of “Dallas,” premiering this summer, on TNT — where a push into original programming has broadened demand for scripted series. Last year, he, noted, there were 94 scripted series on basic cable.
Internationally platforms are expanding as well. Warner’s “The Mentalist” is the top-rated show in France, Rosenblum said, while comedies “The Big Bang Theory” and “Two and a Half Men” are No. 1 in many territories. He said pricing for firstrun comedies and dramas has doubled in five years. The robust market triggered a push into local production and an interest in acquisitions. Last fall, Time Warner acquired BlazHoffski Holding, an independent producer in the Netherlands. The company tried to bid for Endemol and is looking all over the world.
Rosenblum said steady cash flow is TV’s big strength. “We spend a billion on network series, but unlike film…we know what the licensing revenue will be.” Domestic licensing fees cover more than 70% of costs and international 50%. Total fees exceed production costs, and then come home entertainment, syndication and digital deals.
Digital, international and lower costs have offset a drop in home entertainment revenue to 14% from 24% of total revenue. DVDs are expensive to produce and ship. Rosenblum touted deals with Hulu and Netflix as particularly crucial for the CW, which Time Warner jointly owns with CBS.