For me today is going to be a challenge to focus on work while keeping an eye on the info-fest that is Transfer Deadline Day. For those that aren’t into football, it’s one of the two days in the year (the other is the end of August) when the transfer window closes, and clubs are no longer allowed to sign players. The day is covered by the BBC and Sky on TV, text, radio, and probably carrier pigeon too. It’s known as the only business where people still use faxes to send contracts at the end of the window approaches, and no TDD is complete without a story of a last-minute paper jam which prevents a deal being done. Leaving shopping till the last day of the sales is something I can really relate to. I’m never through the doors first, unlike this lot…
The Football Transfer Window has been in place since 2002-3, which coincidentally is just before the acquisitions spree that started with new Terms of Trade being introduced for the UK production sector in 2004. This gave companies control of the righs in the ideas they created, and, therefore, made them valuable. Money poured in from VC and other investors in the UK, and from a cottage industry the production sector suddenly became a business worth billions. (Big thanks to Nick Ware who gave me the idea to connect these two themes for this blog even though he’s not into football!)
Britain’s status as the capital of production company mergers and acquisitions hasn’t changed. It seems that the main reason now to start an independent company in the UK is to be able to grow it fast and then sell it – it’s business, after all.
For Brits, most global revenues still come from America. At last week’s Realscreen summit, 70 UK producers were in attendance. PACT set up a British Pub in the lobby of the Washington hotel where it all happens. The UK trade association PACT also announced the setting up of a US organisation for UK companies and their US offshoots, – with offices in LA and New York to be set up this year.
PACT’s figures seem to show that the only full commissions for UK companies over the past two years were from the US – though this doesn’t include coproductions, as there have been plenty of those from elsewhere in the world.
Companies in the US have a struggle to hold onto the IP in the formats they create – the channels try and take as many rights as they can – but in the UK that IP is the foundation of their business. That doesn’t stop UK companies pitching, or investing in US companies – the size of the business there means that companies are still profitable even though the rights position isn’t nearly as good. Arrow Media’s John Smithson has a pithy column in Realscreen magazine and he returns to the theme a lot.
It does of course mean that the development focus for companies is on returnable formats, as this is what those investors want to see to get a revenue stream from the company. Like transferring a football player for an eye-watering sum, there’s no guarantee of success though; while ideas are still dependent on those capricious commissioners, there’ll always be a big element of uncertainty.
Now, how about a Transfer Window for production companies?