The global economic downturn may not quite be generating a universal blanket of pessimism for TV biz players, but for many, especially in Europe’s Big Five territories, general uncertainty rather than outright gloom seems the prevailing mood.
For much of Europe, big drops in spending are just the most pressing and powerful of current problems. Blighty-based industry analyst Screen Digest recently offered up grim forecasts for 2009 big-market ad-spend drops compared with 2008 — down 4% in Italy to 12% in Spain.
Jan Mojto, prexy of German-based production behemoth EOS/Beta Film and a near 30-year veteran in the business, earned chuckles from Mipcom attendees in October when he said his shingle was now accepting bars of gold as payment from cash-strapped buyers.
Funny, but the situation isn’t a laughing matter, especially as the worldwide recession has only worsened since then.
“The cake will be smaller, you can see that already in Europe,” Mojto explains with regard to profits. “France, especially, is in a very difficult situation with the drop in ad revenues, especially for TF1.”
Mojto sees prices for valued U.S. products, such as the “CSI” franchise, remaining stable, but says a major challenge is that American product is being overexposed on multimedia platforms before reaching global TV viewers.
For Munich-based sales and co-production giant Telepool, exec VP Irina Ignatiew says the scariest new development has been the fast plummet in ad revenues for broadcasters in Russia and Eastern Europe.
Eastern Euro buyers were present in numbers at October’s Mipcom, but that probably won’t be repeated at Mip. Ignatiew, however, will be there to get a sense of what the next global TV trends will be.
As for her thoughts on the current state of the biz, she says: “Overall our programming is remaining very popular in our established territories. European networks will continue to need a great deal of high-quality European content.”
On the downside, however, Ignatiew says, “Big-budget productions in general are likely to suffer, often quite a bit.”
If true, her predictions offer little cheer for Italo pubcaster RAI, which announced in January it would be pumping $400 million into homegrown productions this year, mainly at the expense of Hollywood fare.
While high-end RAI product, such as crime-busting priest drama “Don Matteo,” is now selling in far more markets, RAI Trade topper Sesto Cifola sees buyers increasingly “wanting excellence for a very cheap price.” That’s not always easily deliverable, especially for lavish co-productions such as 2007’s $38 million “War and Peace.”
RAI’s dubbing and other production costs are rising, while the European Union’s traditional markets are producing less, meaning more nets are looking for cheaper acquisitions.
RAI Trade’s recent change in marketing strategy, which Cifola sees as already paying off, has been to boost promotion and increase the number of on-the-ground reps, especially in nontraditional markets such as Blighty, Asia and Latin America.
Despite what might appear to be a buyers’ market, few industry insiders predict a drop in skein prices in their territories.
Sandra Ouaiss, fiction acquisitions topper at Gallic paybox Canal Plus, says program prices “may maintain their current levels, but won’t likely increase.”
As an established paybox, she feels Canal Plus “can afford to be picky and is expected to be edgy” when it comes to pickups such as recent hits — AMC’s “Mad Men” and recently canceled macabre laffer “Pushing Daisies.”
But for Ouaiss, a major factor in U.S. series buying has yet to be resolved to her satisfaction.
“There has been a drop in creativity in the past few years from the States,” which she says has yet to recover from the latest Hollywood writers strike. “The promise of a few years ago has yet to be followed up on. We’re looking for more creativity and better quality” — quality she concedes is often found — as easily and as competitively priced — in non-American product.
Sue Deeks, the BBC’s acting head of acquisitions, feels it is simply “too early to say” regarding pricing trends.
Deeks is looking to May’s L.A. Screenings for a better sense of the industry’s prevailing winds, both in Blighty and developed territories.
“It feels that things have changed so fast, even since Christmas” in terms of the deterioration of overall market conditions.
They could change that fast again.
The TV industry, she says, is “in a limbo period and will stay so until people know what they can spend, and if they will have the wherewithal to do it.”
When: March 30-April 3
Who: 12,000 participants