How Canadian Broadcasters Work
Broadcasters are the catalysts (and major customers) for content production. They license, co-produce, commission or outright create television and online content. They trigger a number of external funds for producers to access, and they acquire various types of rights and clearances to broadcast that content to Canadians, thereby generating advertising and / or subscription revenues. Broadcasters generate revenue in a variety of ways: selling advertising (sponsorships, spots and time buys), international sales and syndication, merchandising and product placement, streaming or download fees, and in the case of specialty channels, via subscriber fees.
What Broadcasters Want from Interactive Digital Media
Broadcasters differ from each other in how they are structured to support interactive digital media. Usually there will be an executive with the sole responsibility of managing interactive content for the network or channel. At larger broadcasters, there may be an online/digital/interactive content liaison executive for individual content areas, such as Children’s, Documentaries, Drama or Variety.
Broadcasters Want to be a Participating Partner
What many broadcasters want most out of the online content proposal process is participation.
It is essential to establish contact with the right individual at the broadcaster early in the process to determine what their expectations are, how much involvement they want and what they might have to offer.
Check with the broadcaster and ask a lot of questions:
- What rights do they want? For how long? What territory?
- How long is the site (or application) expected to remain online or active?
- How closely linked to the television content does the site (or application) need to be?
- What are the requirements for ads or sponsorships?
- Will they require an “evergreen” version of the site when it is not on the broadcast schedule?
- Can the site creatively expand the characters or plot from the TV series? Who will review and approve, and do you require a writer, talent or content from the show?
- How does the broadcaster feel about content extending to other platforms or channels, like YouTube or social networks?
- How comfortable are they with the risks and opportunities associated with technical innovation?
- What are the technical specification for their website? Who will be responsible for updating the content?
- Do they have deals with mobile content providers? Social networks? Portals?
Consider the basics goals that broadcasters likely have for interactive content associated with a television program:
- promoting the broadcast component and attracting new audiences
deepening a relationship with audiences; the phrase “360 degree content” is often used, and broadcasters look for opportunities to go where they think their audiences spend time
creating compelling content that can exist on its own and draw in audiences
Enhancement of revenue opportunity
Broadcasters Want Approval Rights
Broadcasters are used to having many stages of approval on content for television. This is now the case for interactive content, so plan for this in every stage of communication with them from proposal concept, to writing the proposal to actual content production and delivery. Establish milestones for approvals, and formal sign-off. Expect revisions, and budget for them accordingly.
Broadcasters Want Your Timing to be Right
Broadcasting is very much a deadline business and interactive content linked to broadcast has to be synchronized extensively with the television content. Interactive producers often deal with moveable deadlines as technical issues and scope creep emerge in production, which can lead to be a constant cause of tension between television and interactive producers. This tension can be contained via good research, accurate estimates while preparing proposals, and management of scope during production. One of the best ways to assure broadcasters that things are under control is by establishing a top-level group of milestones, and remain in contact with the broadcaster as each is met. Everyone recognizes the challenges of emerging technology so it is vital to constrain concepts to realistic time lines.
Broadcasters Want Quality
Quality of the interactive content is a top priority. Quality can mean many things. For example, if you are creating a back-story video for a drama, a broadcaster will expect the writing to be similar to the series, if not by the same writing team. Replacing actors with overdubbed audio for a game will probably not be acceptable. If a site uses video on it, expect the broadcaster to push for the best experience possible for their audience.
Broadcasters Want Content that Fits their Budget
Some broadcasters offer license fees or equity investments for interactive content. These fees can range from a few thousand dollars to closer to $100,000, depending on a broadcaster’s interest and priorities. Not all broadcasters offer fees, and there is no current standard for the amount of money made available. Broadcasters will have different fiscal years, different approval processes, and varying sources for how they fund interactive digital media.
Even if license fees are not offered by the broadcaster, they bring a lot of in-kind services to the relationship. Hosting, marketing, advertising, syndication and many other commitments can be made by the broadcaster to increase their leverage and push the project to success. Perhaps the greatest asset broadcasters have is the size of their audience, and ability to sell against it.
A word to the wise about putting your interactive production budget together. Some broadcasters have very experienced teams in place that also design and create interactive content. They will have input on production budgets, so expect their scrutiny on production and content plans.
Don’t forget to include all rights acquisitions and clearances for the term of the agreement with all related parties. Broadcasters have relationships with various collective bargaining units, and it is important to recognize this when creating any new content that requires their skills.
Broadcasters May Want Technical Support
Broadcasters usually have very structured technical services established for their content. They have bandwidth, redundant servers, and consider their websites to be similar to their channel, with very little downtime. If independent producers are hosting interactive content, there could be an expectation of a similar level of service on behalf of the broadcaster. Hosting can be an enormous fiscal burden depending on the content, and should be factored in clearly for the proposal.
Often it makes sense to leverage the broadcaster’s technical infrastructure for expensive data like video or multi-player gaming. Be explicit about who hosts what, if there are any costs associated with hosting, and how long it will remain online.
Often the broadcaster is only interested in Canadian rights. Producers may still have to run an alternate site for each territory in which the interactive content sells.
Creating a project that encourages user-generated content or that integrates with social networking sites can be attractive to broadcasters. However, these activities can also have enormous maintenance and staffing/moderator issues in order to remain relevant.
Make sure that there is a clear understanding of the impact of creating content that requires human intervention. Broadcast licenses often span multiple years, with the assumption or expectation that the interactive content remains active throughout the term. Be explicit about who is responsible for what activity, and for how long.
Some broadcasters have existing social tools or relationships with vendors in place, and the interactive content will be expected to mesh with them seamlessly. These tools change often, so get the latest technical specifications from a qualified person at the broadcaster.
Find a technical contact from the broadcaster early in the proposal stage, and acquire technical specifications and identify integration concerns, regardless of where your project is hosted. Get the technical issues approved as early as possible to avoid surprises in production.
Broadcasters Want Marketing, Sales and Promotion
Most broadcasters have their own marketing and ad sales teams in place that are well positioned to leverage their relationships for your content and may agree to split revenue with you in certain cases. They may also be interested in having sales done via relationships initiated by the interactive company if the benefits are attractive.
Make sure you clearly outline what the project can expect from broadcasters in terms of promotion and marketing, and that they make sense for the target audience. Feel free to suggest alternative methods of marketing early to gauge interest, but be prepared with research to back up your ideas. Broadcasters vary in how modern or traditional they are in marketing, so work closely to benefit the project in the best way possible. Some broadcasters have strict rules as to what and how they can promote or sell. For example, many broadcasters consider children’s programming to be commercial free, and will extend those limitations to online content. Others will select only a group of priorities for promotion, with a focus on series in their first season in order to establish audience. When in doubt, try to include someone from the broadcaster’s marketing or communications department in your discussions.
Broadcasters also differ in their expectation for what the URL of the project will be. Many insist on hosting content and having the promoted URL point to their domain. This is where geo-fencing can be an attractive way to align the distribution of content with broadcasters’ expectations for their territory.
Broadcasters Want Revenue
All broadcasters, whether commercial or public, judge some or part of their online success by measuring traffic. Content must be measurable, and in a perfect world will be verified by a third party in order to make it more attractive for display advertising. More broadcasters are aiming for “total audience measurement,” which provides a snapshot for a property and how it performs in broadcast and all other places where the content is located. Consider this in the design of your content, and expect that broadcasters will push for solutions that fit their current statistics system. For example, if a broadcaster expects to make a certain amount of revenue via display advertising, build your content in a way that allows them to count page views or insert ads.
Revenue for interactive digital media can come from a variety of sources:
- Display Ads
- Syndication deals
- Product Placement
- Subscription fees
- Streaming/download fees
Usually broadcasters will want the rights to exploit the content they have licensed. There are some situations in which a revenue share can be negotiated. Since models are emerging for online revenues, everyone is looking for interesting opportunities. Be clear in understanding what participation you have for which activity. Watch for definitions of “gross” revenue and “net” revenues. The broadcaster may expect a commission (for example 10-15%) to sell content sponsorship with additional deductions for out of pocket expenses incurred. In addition there may be union use fees and broadcasters may expect to recoup their original licence fee or investment and then share net revenues (the split usually negotiated on a case per case basis) with the producer. But not always! Some broadcasters expect to share gross revenues from any exploitation of the interactive content in all formats and in perpetuity. For others, all revenues generated in the broadcaster’s territory is revenue for the broadcaster.
Everyone in the media business is attempting to determine which models for production and revenue make the most sense. Many broadcasters are seeking new ways to create and distribute content. Expect the landscape to continue to change, but know what you want to retain or participate in early in development.
Broadcasters Want Domestic Rights and Territories
Usually television producers license their content to a broadcaster for exploitation within a certain geographical territory, allowing the producer the ability to sell the content to other countries or territories. This model is now extending online, as many broadcasters are acquiring various online distribution and syndication rights but often unifying them to the same territory as their broadcast license via geo-fencing.
Be aware, that interactive content is increasingly considered to be simply a part of an overall, integrated content production. Broadcasters therefore are seeking to synchronize rights wherever possible with their broadcast licence. For example, if their license for broadcast spans seven years, they would expect the same for interactive.
Due to the nature of some funding sources and the requirement for a license prior to submitting a proposal, synchronizing can be problematic. Add in that interactive is often produced by a third party, and it means the reality of having two separate agreements; one for television, another for interactive.
Television has a long history, and the legal and business development processes are established. The emergence of interactive has placed a lot of pressure on the broadcasters to update their approach to agreements, but interactive companies entering into a relationship should come prepared with legal counsel and a strong sense of what they are prepared to do what they are not prepared to do.
Creating content involves a large group of dedicated people and a lot of communication. Contact the broadcaster’s interactive executive early. Get their buy-in for your concept, and the support from their technical and marketing support areas. If they plan on committing a license fee, get it in writing. Establish milestones for each major stage of the project, and stick to them if you’re lucky enough to get your project approved. Allow your broadcaster to have approval on design and content. Broadcasting is a communications business. Keep the lines open, and hopefully your project will lead to many more in the future