Dare to be different

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By Ed Waller 17-10-2012

Every territory around the world wants a bigger slice of the global formats pie. The question is, how should they go about it.

Hole in the Wall

A year ago at the C21/Frapa International Format Awards at ClubC21 in Cannes, intellectual property protection body Frapa and media law firm Olswang said the global television format industry was worth US$4bn, up from its estimate of US$3.1bn in 2004.

Since then, the industry can only have kept growing, as more broadcasters seek to expand their programming from acquisitions to local productions but without the added risk, cost and time of original development. Whether it’s Central and Eastern Europe (CEE), the Far East or US network primetime, the market for TV formats is booming.

John Ranelagh, head of acquisitions at Norway’s TV2, points to the recent row between Banijay and Eyeworks over their celebrity diving shows as a sign of the increasing importance of formats to European broadcasters. “There is extraordinary interest in formats. A few years ago it was scripted drama, and a few years before that it was gameshows. We’ve reached a point where everything is considered a format and everybody is suing everybody else,” he says.

“It’s clear the interest is generated because of the mushrooming of international networks utilising libraries that have been the spine of daytime on secondary channels for years. Suddenly, it’s all available on Netflix and LoveFilm so the value of library to a channel has almost disintegrated. People are looking for cheap and cheerful alternatives and that’s where formats come in.”

But it’s not just broadcasters that benefit from formats. Global production groups are built on them, as they exploit demand for their hot formats to prise open production sectors in other markets, in a way that you can’t do with completed programming. The list of companies that are looking to become ‘the next Endemol’ is almost as long as the list of candidates billed as ‘the next big thing’ in entertainment.

Thirdly, formats also have a role in upskilling production sectors in emerging markets, allowing them to focus on execution before they tackle original development. This has happened in CEE and Latin America and is now happening in Africa. Watch out for hot new formats from producers there.

But the entire edifice of the formats industry is built on two cornerstones. The first is a rather shaky concept of what constitutes a format. Hence, the regular epidemics of paranoia about format theft, the latest examples being Celebrity Splash vs Stars in Danger, Big Brother vs Glass House and Dilemme vs Loft Story. Hence, too, any number of format conference sessions passim ad nauseam titled What is a Format? Hence, people often try to sell things that are evidently in the public domain as their own IP.

The second cornerstone is the fact that for the whole industry to work, somebody somewhere has to take a risk on an untested idea. Not every broadcaster can be risk-averse; some have to take a punt in the first place and then there’s something to sell to those who want to outsource risk.

The system begins to fall down if broadcasters that do take the first risk aren’t rewarded for doing so. For example, Canada’s relatively small slice of the global format exports pie is not due to extraneous factors like its small market size (Israel is a tiny TV market yet has a major share of the business). The fact is Canadian networks aren’t rewarded for being the first to take a punt on a paper format, due to well-meaning but counter-productive terms of trade that hand all format rights to producers.

Ironically, similar terms of trade in the UK helped to propel its producers to the forefront of the formats industry – something the architects of the Canadian terms where no doubt hoping to emulate. However, the key to the UK market is that its TV industry is notoriously self-contained and dominated by a public broadcaster that commissions loads of new ideas and isn’t financially penalised if its shows don’t work.

Countries hoping to move from IP importers to IP exporters – and there are many – should study the risk-taking territories that dominate the sector. Other big format exporters like Japan and Israel are vastly different in size but share certain characteristics: they are both culturally and linguistically isolated, very self-contained markets that are able to grow their own ideas away from the mainstream.

They are what the Galapagos Islands or Papua New Guinea are to evolution, in that formats there develop in isolation, so when they do finally emerge from the bush they look like nothing you’ve seen before. That doesn’t necessarily mean they will be hits, but being different is halfway there, as Japanese formats like Hole in the Wall and Takeshi’s Castle illustrated. Ideas germinated in Canada, on the other hand, have all been influenced by shows beamed in from the US.

If my theory is correct, then formats from the remote mid-Pacific islands should be welcome new entrants to the formats business. In Cannes last week, Absolutely Independent chief Patty Geneste launched some new Tahitian formats. You never know…