As multi-national media companies turn with increasing interest towards Asia for their next phase of growth the focus on intellectual property, its respect and protection gains ever more profile and importance. Yet for those of us who trade not in tangible goods or services but in creative ideas, concepts and formats, navigating the cultural landscape throws up many new and often unexpected challenges.

Around the world our experience of the evolution of what I might call ‘creative respect’ follows three distinct phases. The first is a ‘wild west’ or ‘free for all’ where there is little or no respect for any type of IP or ideas. Creative content, whether in part or in total, is openly appropriated without permission or payment, with the owner having no effective recourse through legal or trade routes to resolve their issues. Phase two is characterised by a general recognition that ownership does exist within our type of IP but respect for it is only shown if failure to do so damages a local interest. It still remains OK to appropriate content and ideas from some faceless foreigner without acknowledgement or cost. For the IP holder the cost of protection and enforcement still outweighs the chance and value of successful objections. Phase three is where there is both a recognition of ownership and an acknowledgement of value from the potential user.

As we all transact business around the region it is relatively easy to identify which territories have reached which stage of the evolution outlined above. We have developed a range of strategies to try and protect our interests and minimise our exposure. These include limiting access to materials, building in difficult or impossible to replicate software or prizing and widely exposing the success of the original to encourage viewer rejection of any copies. More importantly, we try to set our business models and our pricing structure in a way that encourages cooperation and that brings value and support beyond the straight licensing arrangement.

This value and support can take many forms and has historically been centred around the provision of consultancy services which provide production support for the set up and execution of the show and its further development over time, ensuring successful enhancement from around the world can be added at a local level to keep a format fresh. This is in addition to the production bibles which provide detailed execution guidelines on all elements of the show, technical support and skill transfer and the opportunity to visit other productions of the same property in other territories. However, more recently, IP owners like ourselves have been bringing sponsor associations based on successful partnerships in other markets, interactive, mobile and on-line applications, pre-built and available for localisation and other proven marketing and revenue generating models which enhance the overall value of the offer. We can also provided detailed demographic and ratings information from other territories. More consultancy is offered and there is a greater understanding of how to deliver the core creative idea or format whilst at the same time ensuring that viewers get a truly local experience.

However now we face two new challenges. Firstly the growing confidence of many of the region’s broadcasters is encouraging them to commission local ideas which don’t carry an obvious ‘format’ fee. FremantleMedia applauds these local initiatives and are actively seeking ways in which we can extend our regional presence to be part of this vibrant community as well as looking to facilitate broader distribution of these local or regional formats. However, there should be no misunderstanding that such programming carries a different risk profile from programming that has already been proven in other markets and like all new programming original concepts stand or fall based on the strength of their core idea and their appeal to viewers in a competitive market.

The second challenge is around the licensing model. Some broadcasters and also licensed producers resent the continuing financial obligation to the IP owner and query the additional value they get on renewal after a successful first term. This is a fundamental misunderstanding of the business arrangement. IP holders are offering up limited use of a creative idea against which their partner expects to make a profitable return either as a producer making a production margin or as a broadcaster through advertising sales. If either partner wishes to extend the arrangement because they see a continued business opportunity then a further license is required. This makes the risk reward ratio for both parties attractive. The alternative of the broadcaster or producer buying out the rights for a one time only fee would either prove prohibitively expensive against the potential risk or financially unattractive in the long term for the IP owner looking to capture maximum value and hence not a sale that they would wish to make. IP holders do not underestimate the investment made or the huge contribution their partners play in making a project successful but it is, as I state, a partnership in which all players must be fairly treated and appropriately rewarded.

Active engagement of both Asia based and international creative companies in media markets around the world requires a mutual understanding of and respect for the value of creative ideas and intellectual property. Closer relationships will lead to a more multi-directional flow of these ideas to the benefit of both businesses and viewers around the world.

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