The drama business has had to become increasingly creative and collaborative as the streaming boom drives up production budgets and competition. Tim Dams reports.
Ambitious BBC/HBO fantasy drama series His Dark Materials
Choosing which drama to watch on TV has got even tougher recently. The November launches of the Disney+ and Apple TV+ streaming services offered up big-budget originals such as Star Wars spin-off The Mandalorian and Jennifer Aniston-fronted The Morning Show. The same month, Netflix dropped season three of The Crown, while HBO and the BBC aired their lavish adaptation of His Dark Materials.
Even though viewers are already spoilt for choice, there’s going to be even more drama on offer in 2020 and beyond. Existing players, such as Netflix and Amazon, are boosting spending to win subscribers in an increasingly crowded market. New global streamers such as AT&T’s HBO Max and NBCUniversal’s Peacock also join the fray next year, while recently launched regional platforms such as BritBox and Joyn are stepping up their commissioning of original dramas. Traditional free-to-air (FTA) broadcasters, meanwhile, have realised the only way to meet the threat from the streamers is to offer more compelling dramas of their own.
Nina Lederman
The Economist magazine in the UK recently ran a cover story on the streaming boom – headlined ‘The $650bn Binge’ – which quoted startling statistics to illustrate the scale of investment now going into content.
The average cost of producing a single episode of scripted drama is now close to US$6m, twice the going rate of three or four years ago, according to the publication, citing figures from research firm Bloomberg Intelligence. Meanwhile, 16 firms, from Disney to Quibi, will spend a total of US$100bn on content, according to investment bank UBS. That, noted The Economist, is roughly equal to the sum invested in the US oil industry this year.
Back in 2015, FX chief John Landgraf famously coined the term “Peak TV” to describe the then 422 scripted TV shows produced in the US that year. Far from falling back, as he predicted, the figure has only increased since then.
“The number of dramas has risen and will continue to increase as more and more streamers order more content,” predicts Nina Lederman, exec VP of global scripted development and programming at Sony Pictures Television (SPT).
For producers like SPT, Lederman says, the SVoD boom “means more opportunity, especially global opportunity.”
The BBC’s upcoming adaptation A Christmas Carol
This is only going to increase as the second wave of streamers takes root, all needing original content to build their platforms and determine their brand. “The more buyers, the better,” Lederman adds. “It opens up a lot more opportunities for our producers and writers to develop ideas that appeal to many different buyers with different mandates and multiple access points.”
Her point is echoed by Simon Cornwell, co-founder of The Ink Factory, the UK production outfit behind The Night Manager and The Little Drummer Girl.
Cornwell says the drama production market is enjoying a unique window of opportunity, ahead of a likely “shake-out” further down the line. He cites two key factors at work. Firstly, very deep-pocketed players are spending heavily to enter the streaming market and are prepared to endure significant losses for an extended period to grab market share. Secondly, these new entrants believe one show can make all the difference in the battle to win subscribers, just as House of Cards transformed the fortunes of Netflix.
Carlo Dusi
The upshot, argues Cornwell, is that “you’ve got people who are prepared to make creatively big and bold bets.” Like Lederman, he says this has helped buoy business for leading producers. The Ink Factory, he explains, currently has three times more projects in development with streamers than it did last year.
The boom has benefited top talent, particularly writers, who find themselves in a seller’s market which has driven up prices. But it has created opportunities for up-and-coming diverse talent too, both in front of and behind the camera, says Carlo Dusi, exec VP of commercial strategy for scripted at Red Arrow Studios International. He speaks of a “new injection of life” into the drama community, and that a “bottomless appetite” for content means long-standing barriers to entry are falling.
This has also helped non-English-language fare, with shows such as Spain’s La Casa de Papel and Germany’s Dark travelling widely. Viewers around the world are now “used to and educated in watching subtitled or dubbed content that tells stories about very different realities to their own,” says Dusi.
This is a major benefit for internationally focused studios like Red Arrow or Sony, allowing them to put a much wider variety of content into development and production. “The streamers are focused on a broad curation of series,” says Sony’s Lederman. “Those that are already in numerous territories are commissioning or co-commissioning culturally authentic and relevant series in many languages.”
But it’s not just the new entrants that are taking big risks to win audiences – so too are many traditional free-to-air broadcasters.
Red Arrow’s Dignity centres on a German cult in Chile
Julien Leroux, Cineflix Media’s senior VP of global scripted coproductions, says local broadcasters are now reacting to the disruption caused by the streamers. When they do, they have important advantages, argues Leroux, not least a very powerful relationship with their audience. Many are now focused on transitioning this relationship into the digital era.
Leroux cites the launch of the BBC and ITV’s BritBox platform in the UK, as well as France Télévisions, TF1 and M6’s upcoming service Salto, RTL’s TV Now and Joyn from ProSiebenSat.1 and Discovery as evidence that broadcasters are responding to the challenge.
Broadcasters are responding decisively in the drama market specifically. Red Arrow’s Dusi says: “Heightened competition has made a lot of the traditional players rethink how they operate, step up their game and become more dynamic.”
Simon Cornwell
Cornwell offers the BBC as an example, saying the pubcaster is taking some “incredibly bold and important decisions” and “really stepping up to the challenge.” New BBC/HBO series His Dark Materials, he claims, “is a very clear statement about building and participating in things that are really competitive at a global level.”
For his part, BBC controller of drama Piers Wenger says His Dark Materials is “undoubtedly one of the biggest dramas we have ever done.” He also flags up forthcoming series Dracula and A Christmas Carol as shows that demonstrate the “ambition” of what the BBC is now trying to do in the drama space.
Wenger also notes the BBC has partnered up on each of the three dramas, with Netflix on Dracula, HBO on His Dark Materials and FX for A Christmas Carol. Authorship remains crucial, however. “The premium cable channels are not interested unless we are offering them good material in the first place. Everything still starts with the writer.”
Wenger pitches the BBC as a home for a wide variety of creative talent, both established and new. The Capture, which proved a hit for the BBC this year, was penned by Ben Chanan as his first TV project. Spotting and nurturing new talent, and getting their work on screen, is a “huge part of what we can offer the creative community,” he says.
Despite competition from streamers, top talent continues to work with the BBC, from Sally Wainwright and Steven Knight through to Steven Moffat, says Wenger. “Talking to producers, we are hearing more and more that the deals [with the streamers] aren’t quite as rich for producers and new talent as they once were.” High-profile agreements such as Phoebe Waller-Bridge’s reported US$20m-a-year deal with Amazon are “quite limited rather than the general rule,” he says.
Cineflix spy thriller Mirage has a budget of US$2.5m per episode
Deal-making itself has become broader in scope over the past year, with more producers and broadcasters partnering up to achieve the budgets needed.
Two years ago there was concern that Netflix and Amazon were set to “turn off” the international coproduction tap. They would, warned Sister London boss Jane Featherstone, only be interested in funding projects where they could take all global rights, shutting out FTA broadcasters and working with producers on a cost-plus production model.
However, this has not necessarily come to pass. In September, Netflix CEO Reed Hastings said the streamer would have to change if it wanted to attract the best projects in the face of growing competition. He pledged to be less defensive about how Netflix shares rights with producers in the future.
It’s a similar story at Amazon. Georgia Brown, director of European originals for Amazon Studios, said over the summer that her company would offer producers flexible deals and that it remained keen on coproductions, citing successes such as Fleabag and A Very English Scandal.
Now that Netflix and Amazon are “no longer the only gigantic chequebooks in town,” Red Arrow’s Dusi says he expects them “to go back to softening their all-or-nothing position” on rights. “There’s a myth in the marketplace that there is a ‘one-size-fits-all’ deal when you work with the streamers,” agrees The Ink Factory’s Cornwell. He describes the drama market as “a mixed economy” with different funding models available, from fully funded buy-outs through to broadcaster licence fee plus deficit finance against international sales.
Eight episodes of The Romanoffs cost Amazon US$70m
Sometimes the sums on offer from a streamer are so high, however, that a full buy-out makes sense. Amazon is understood to have paid in the region of US$70m for eight episodes of The Romanoffs. For such a sum, it’s likely worth taking the profit upfront, even at the expense of IP.
Dusi says there is no longer an automatic way to fund shows, but each deal is increasingly bespoke. In part, that’s because budgets now need to be so high that partnerships are increasingly necessary. He says the business side of TV has become much more creative itself. “We all have to be incredibly flexible, adaptable, fast-thinking and pro-active in the way we work,” he says.
Soft money, subsidies and tax credits, through to brand partnerships and private equity, should all now be considered as ways to help fund drama.
Dusi points to Red Arrow’s new English-language series Vienna Blood, produced by Endor Productions and MR Film. It was funded by Red Arrow Studios International, Austria’s ORF and Germany’s ZDF, and secured support from regional funders Television Fund Austria, Vienna Film Fund and Niederösterreich Kultur, as well UK high-end tax credits.
Red Arrow is also behind Dignity (8×52’), a Chilean/German coproduction about a German cult in Chile. The drama has been produced for Joyn and in many ways is emblematic of the growing number of dramas being made for new local SVoD services.
Cineflix’s Leroux also says it is increasingly important for drama players to “join forces” to get expensive scripted projects off the ground. He highlights Cineflix’s English-language spy thriller Mirage, which has a budget of US$2.5m per episode. The show is the first copro for France Télévisions and ZDF as part of The Alliance, formed last year to create dramas with international appeal that can compete with SVoD players. The show is produced by Connect3 Media and Lincoln TV in partnership with Wild Bunch Germany. Cineflix has worldwide distribution rights, including in the US and UK. Bell Media and Superchannel in Canada are also commissioning broadcasters.
The Capture was writer Ben Chanan’s his first TV project
Drama has to be big to stand out in such a competitive market, says Leroux. Five years ago, though, the idea of putting together a US$2.5m-an-episode French-originated drama would have been almost impossible, he says. “But now it’s easier because we have broadcasters that are more flexible.” They are, he adds, shifting their perspective, no longer focusing solely on creating their own local dramas but keen to join forces “to fund big international shows.”
Leroux makes another point: the relationships between broadcasters, producers and distributors like Cineflix has also changed. “It’s very important for us to have a partnership that is beyond financing, that’s about working together to create a show that will resonate.”
If Cineflix is investing in a project, then commitment from the primary broadcaster is key, he says. Marketing support, he adds, is a priority.
This, perhaps unsurprisingly, is flagged as a key reason by the BBC’s Wenger as to why talent should work with broadcasters like his rather than streaming rivals. If the BBC backs a project, he claims, “it means your show is going to be very well marketed, and it is going to have a press campaign behind it that is second to none, and it is also going to get broadcast on a big, live-to-air channel and will be seen by millions of people.”
In other words, a FTA broadcaster like the BBC will help the show to be seen. That’s an important factor at a time when viewers are faced with infinite drama choices and a raft of competing streaming platforms.
