Major construction work along Cannes’ famous Croisette has turned this most glamorous of French coastal towns into a chaotic construction site. Television executives in town for the MIPCOM Cannes international TV conference, which runs until Thursday October 19, faced a gauntlet of concrete slabs and cordoned-off danger zones.
It’s an apt metaphor for the mood at MIPCOM this year. A variety of factors – the actors’ strike, rising inflation, a collapse in the advertising market and a decline in investment by global streamers – have combined to weaken the fundamentals of the international TV business. Executives proceed cautiously, as if afraid the entire structure will collapse beneath their feet.
“There is a lot of fear out there, a lot of companies are worried that they might not be there in six, 12, 18 months,” said one MIPCOM veteran, CEO of a mid-sized European manufacturing and distribution company. “Netflix and Amazon no longer buy almost everything in most markets, but only one or two shows. If you’re not one of those two, you end up with nothing.”
The hardest hit were the top tier of the market, those producing big-budget drama series. Since most broadcasters and streamers are now unwilling to provide premium fiction with cash flow, small and medium-sized producers are coming under pressure, inflation is eating into their margins and the risk of default is increasing.
“There will be blood in the water before this is over,” notes Danny Fisher, CEO and co-founder of AVOD group FilmRise.
While high-end dramas have become a risky venture, unscripted entertainment and reality TV are seeing a revival at MIPCOM. This has less to do with the ongoing strike by actors in the USA and more to do with the cost-benefit analysis of individual channels and platforms. Streamers in particular rely on cheaper entertainment programs. Prime Video announced at MIPCOM that it has signed a deal to adapt the British game show The 1% Club, and ITV quiz program produced by BBC Studios for its service in North America. The news follows the launch of Fremantle’s successful competition format to have talent on Disney+ in Italy and the new edition of the legendary Australian soap Neighbors on Amazon’s Freevee in the UK and US
“I’m in talks with streamers for entertainment and reality shows, even soaps,” said Sascha Schwingel, the new CEO of Fremantle-owned German production giant UFA. “On the script side, everyone wants less ‘edgy’ shows and more mainstream, procedurals and the like.”
What makes the unscripted deals particularly striking is global streamers’ new willingness to share format rights with producers and other channels – Neighbors Premiere, for example, on the Australian broadcaster Network 10, part of Paramount Global – instead of insisting on securing exclusive worldwide rights.
“The changes in the market mean that many people are having to change the way they do business,” said Andrea Scrosati, group COO and CEO for continental Europe at Fremantle, who pointed out that windowing – different broadcasters and platforms sharing the rights to shows over time-limited periods periods – came back into fashion as buyers began to favor cost-efficiency over exclusivity.
Bob Bakish, president and CEO of Paramount Global, made a similar point in his keynote address at MIPCOM this week, arguing that the way forward is a return to the good old licensing business. Instead of “retiring content and building walled gardens,” as Bakish argued, Paramount’s studio rivals sold local rights to programming to international partners in an effort to build their fledgling streaming platforms, which was a “profitable, multibillion-dollar business.” and “a key driver” for global expansion.
“I’m still very confident about the future of the streaming business,” said Guy Bisson, managing director of digital research group Ampere Analysis. “The current downturn has more to do with macroeconomic factors, inflation, etc. As platforms and studios return to licensing and windowing and focus less on subscriber growth and more on ROI (return on investment), we should see a return to growth.”
MIPCOM Cannes 2024 will take place from October 21st to 24th, 2024. The MIPTV partner market will take place in Cannes from April 8th to 10th, 2024.
