Biz is booming for the US studios in the Asia-Pacific as new media outlets are growing the overall revenue pie. Don Groves reports
1 May 2007
For the Hollywood majors, these are the best of times in Asia-Pacific, both as a distributor and, increasingly, as a producer of local content, either solo or as joint ventures. Sales to cable and satellite channels are booming, although securing primetime deals with many of the major free-to-air broadcasters in the region is as elusive as ever. And while the business of selling programming to new media platforms is relatively small potatoes, it's incremental revenue for the distributors—with plenty of upside as those platforms become more entrenched. "The outlook for program sales in Asia is extremely optimistic. The expected growth of both traditional and new media platforms promises increased returns, as does the outlook for many of the region's developing economies, particularly India," says Malcolm Dudley-Smith, Executive Vice President, International Sales & Business Development, Warner Bros. International Television."It is hard not to predict an upswing in returns with increasing investment in the distribution sector throughout Asia. This includes digital cable, DTH and IPTV, as well as broadband, all delivering entertainment content. The challenge will be to respond to these opportunities with innovative and practical programming offers."Equally bullish is Ross Pollack, Senior Vice President, Distribution, Asia, Sony Pictures Television International. Asked to describe the studio's business in the region, Pollack responds, "One word: robust. The proliferation of new media outlets has increased the demand for quality content that viewers around the world know and love. Spider-man, Men in Black and Godzilla are all brand names known throughout the world, making us the first stop for these new media outlets." The mood at the Walt Disney Company is upbeat: "It's an exciting time for us with the rise in new media platforms which create opportunities for more consumers to view our content," says Greg Johnson, VP of Sales, Buena Vista Television International (Asia Pacific)."Though these mobile and other new media platforms still account for a small percentage of our overall revenues, we definitely see this increasing over the next few years. The key for any TV content company is to understand what consumers want – whether it's promos and recaps, full length episodes, mobisodes or original content specific to these new devices – and to tailor their approach accordingly. By providing shows like Desperate Housewives and Lost on new platforms, we're reaching new audiences as well as enhancing the entertainment experience for fans of these shows, which in turn strengthens our franchises, and ultimately benefits both ourselves and our clients."Armed with a slate of theatrical hits and popular dramas such as Prison Break and 24, Twentieth Century Fox Television Distribution is profitably placing product with old and new media clients. "Very healthy," is how Richard Samuels, Senior VP & Managing Director Asia Pacific, describes his studio's business. He talks of a revenue pie which is expanding thanks to the proliferation of distribution platforms."As acquirers of content, new media is not replacing (existing) media," he says. "The market which is the most exciting in terms of new technology is Korea," he adds, referring to the advent of IPTV, VoD and TV to mobiles. "Given that a lot of these businesses are new, we are all still learning."Fox is supplying a package of features to Hanaro Telecom's VoD service. Asked about the initial results, Samuels says, "It's early days yet. Ask me again in six months. We do expect to see some fairly significant growth in that area."While theatrical films no longer serve as engines for volume deals with broadcasters inAustralia as they're over-exposed on earlier windows, pics continue to be valuable commodities to FTA broadcasters in Asia. "Films are still enormously important; in markets like Indonesia they are what drives our business," says Samuels.Mini-major Lionsgate is also capitalizing on increasing demand for Western programming in the region. "The climate for sales in Asia is fantastic right now, with the explosion of new outlets and the growing demand for foreign programming," says Amanda Cordner, Vice President, International Television Sales, Lionsgate, who deals chiefly with cable and satellite channels."There are more unique opportunities available than there were say three years ago, plus the region is so technologically advanced in many forms of delivery right now that it has been a great territory to try out a lot of new delivery methods and gauge their success and see what their potential might be in other markets."Of the majors, Disney is among the most active as a production force in Asia, particularly India. As Vice President of Walt Disney Television International (Asia Pacific), Bonny Yu is responsible for the development of regional programming strategies, regional acquisitions and overseeing local programming, scheduling, and on-air presentation strategies. Additionally, she provides creative leadership in the development of original local production in the Asia Pacific that delivers on Disney channels' global brand values, reflects local preferences, and supports global content output.Under her watch, Disney has been busy producing several series in India, with local partners, for the Disney Channel. Vicky aur Vetaal is the channel's first original live action series in Hindi. Launched in October 2006, the 26 x 30 minute comedy focuses on two unlikely heroes who are constantly getting in and out of trouble. A modern day spin-off of an ancient Indian tale, the show is a collaboration between Disney Channel and Indian production house Cinevistaas Limited. Also involved in the project were children's programming director Suraj Rao, music duo Shantanu Moitra & Swanand Kirkire (composer and lyricist) and singer Babul Supriyo. "The ratings have been very good and we are looking at going into a second series, although we have many new projects that we want to test," Yu says.Launched in January 2007, Dhoom Machaao Dhoom is the channel's first original daily series for Indian tweens. It's the story of four girls who form a school band against the odds, reflecting the tastes, preferences and struggles of kids today. The local production partner is Group M Media India Pty. Ltd., with Disney retaining creative control; the series airs Monday to Friday and will total 104 episodes.Dhoom Machaao Dhoom brings the number of hours of locally produced content on Disney Channel to 30 a week. Yu sees that as important step in building Disney Channel's viewership amongst kids aged 4-14.Due to debut early this summer, Agadam Bagadam Tigadam! (a catch phrase similar to Abracadabra), is a 26 x 30 minute show looking at an alien family who try to blend into their new planet, the Earth, but without being able to use their magical powers.Yu hopes to mount Singapore and Hong Kong versions of As the Bell Rings, a concept created by Disney Channel Italy. In Australia, a pilot of the show, which has tweens at school talking about the issues they face, is being produced as a precursor to a hoped-for series.Mickey Mouse Clubhouse premiered on Disney Channels and Playhouse Disney Channels worldwide in May 2006 and has consistently ranked No. 1 in its timeslot in most Asian markets.Hannah Montana is another consistent performer.High School Musical was a huge hit in Asia, as in the rest of the world, delivering the highestratings ever for a Disney Channel Original Movie, beating pay TV channels and FTA networks. The Asian version of the soundtrack included the song "Breaking Free," sung by up-and-coming Asian talent: Malaysia's Vince Chong, Singapore's Alicia Pan and the Philippines' Nikki Gil. In India the music was re-recorded in Hindi. A Bollywood version of the film is planned for cinema release in India.Speaking of movies, execs at the Hollywood studios say their blockbusters are strong sellers in the region. "Our movies continue to generate record ratings for our FTV and cable licensees particularly our Spiderman franchise and our Asian megahit Kung Fu Hustle,"says Sony's Pollack. "SPTI is uniquely positioned as the Asian Hollywood studio, providing our clients with not just Hollywood hits, but Asian hits as well including movies from China, Korea, Hong Kong, Vietnam and coming soon, India." Pollack continues, "Our network series Kidnapped also did quite well on AXN. Even our library series continue to generate ratings in unlikely markets. Strong Medicine, for example, is the top US series in Brunei. And our local format production The Gong Show is consistently a strong performer on TransTV's schedule in Indonesia."Warner's Dudley-Smith concurs, "Historically movies have attracted a greater value than TV series in our volume deals. In most Asian territories this remains true today. However TV series are seeing an increase in interest, not only from FTA broadcasters, but also basic cable networks which have achieved significant market penetration in many territories."Dudley-Smith notes movies in the middle and lower end categories need to demonstrate ratings appeal to attract buyers. If there is any slackening in demand for features, it reflects the strength of series—local and US—rather than exploitation in earlier windows.Among WB's most popular series are Supernatural on AXN; Smallville, Nip/Tuck, The OC and The Sopranos on Singapore MediaCorp's Channel 5; The Closer and Cold Case on Hong Kong's ATV; and Nip/Tuck, Without A Trace,and The OC on TVB Hong Kong; The OC and Friends, primetime hits on India's Z Café; and The OC, Veronica Mars, One Tree Hill, Nip/Tuck and Tyra Banks Show on Philippines cabler ETC, which launched Pussycat Dolls on April 10. Malaysia is a steady customer for Warner's shows such as Supernatural (TV3), Two and a Half Men (NTV7), and Nip/ Tuck and The OC (8TV).Disney's Johnson says movies such as Pirates of the Caribbean, Flightplan and The Chronicles of Narnia: The Lion, the Witch and the Wardrobe have performed very well. Desperate Housewives, Grey's Anatomy, Lost and Ugly Betty are the studios' strongest series in the region.Amazing Race Asia grabbed 15 million viewers across Asia on AXN, aired at 9pm Thursdays from November 9 2006 through February 1 2007. Not only did the series outperform the past 10 seasons of the US Amazing Race on AXN, it was also the No. 1 show on international cable channels in its timeslot in Singapore and Malaysia.Lionsgate's best sellers include the miniseries The Lost Room (pan-Asian rights acquired by STAR) and The Dresden Files. Cordner says Korea and Japan are good markets for her product, where she works a lot with the Fox-owned channels.Unlike the majors, Lionsgate does not typically package movies and series together in Asia. "We have been quite successful selling our series television on a stand-alone basis as the production value of our television programming is quite high, which is very appealing to the Asian buyers," she says. "The bonus of selling on a standalone basis is that the right series typically ends up with the right broadcaster in the right time slot, and is put in front of an audience that is seeking that type of program. Of course it is many of the same broadcasters buying our television series who have been buying our films for years and with whom we have excellent relationships that have grown as our production has expanded."All distributors face the challenge of juggling windows between traditional clients and telcos and others that are distributing content digitally."Managing windows is time consuming, but not difficult as that is one of our core competencies," says Pollack." What makes SPTI particularly strong in managing windows withboth new media/mobile clients such as telcos and traditional clients, is that SPTI handles distribution to both; which is not necessarily combined under the management of one division at other Hollywood studios."Johnson says, "Each market is unique and so are the broadcaster and telco dynamics in all of these markets. We therefore approach each territory individually to seek a solution which makes sense for the business and our clients while respecting the windows. At the end of the day it's about finding both the right home for our properties and partners that respect and value our content."Sony has been among the most aggressive studios in building its mobile broadcasting business. "Our mobile entertainment team has grown and will continue to grow," says Pollack. "We have invested much in our infrastructure in order to meet the demands for our mobile content. With the success of our Casino Royale mobile products and the demand for our upcoming collection of Spider-man 3 mobile products, we are very excited about the possibilities of this new revenue stream."