International Channels: Global Branding Country by Country

Mar 24, 2003  •  Post A Comment

The advent of increased local production around the world combined with an international economic downturn has hit a lot of distributors right between the eyes, but MGM sees a very different picture. In the past year MGM has grown the ranks of MGM-branded cable and satellite channels fourfold while continuing to service other clients in the same territories.
MGM recently launched a channel in the Netherlands and The MGM Channel launches in Germany, the largest non-English-speaking market, in the coming month. That will put the MGM name on the small screen in 97 countries, with more to come.
The studio’s not-so-secret weapon is its massive film library consisting of titles from United Artists, Orion, Samuel Goldwyn, post-1986 MGM and other sources. “You cannot go out and create 4,000 movies,” said James Griffiths, president, worldwide TV distribution, “so that puts us in a unique position.”
Another advantage is name recognition for a brand that has been part of Hollywood legend for more than eight decades. “The level of emotional response to the roaring lion is exceptional in all the parts of the world I go to for our company,” said Bruce Tuchman, executive VP of MGM Networks and the force driving the massive growth of the brand worldwide.
MGM rarely puts up cash to launch the channels. Instead it offers the brand and loads of high-quality content to a local partner who puts up most of the cost or provides the infrastructure. MGM most often works with existing local cable or satellite providers but controls choice of top management. “We like to be lean, hungry and smart,” Mr. Tuchman said. “You have to find the right people to do that, because we all have to be strong links in the chain.” MGM is partnered with powerful German company Premiere in a long-term multifaceted agreement in Germany, traditionally a tough market to enter. “Our strategy is simplicity,” Mr. Tuchman said. “Our library holds an enormous amount of content. That plus the fact that MGM is a brand known worldwide has created an enormous appetite out there for our product.”
In January MGM hired vet sales executive Marcus Ammon to serve as general manager of the forthcoming German channel. It will be carried on the Premiere Plus Tier of the Premiere platform, with the MGM movie channel offered on a 24-7 basis to subscribers in Germany as well as Austria.
“Marcus is a dynamic and innovative programmer with remarkable passion for the business and a proven track record for success. We are very pleased to have such a highly regarded executive as we create a new branded gateway for MGM programming in Germany and German-speaking Europe,” Mr. Tuchman said. “He typifies our international goals to find the best to represent our interests and be able to target more revenue sources for the company.”
In January MGM Worldwide Television Distribution entered an agreement with UPC Nederland B.V., Holland’s largest cable operator, to launch the MGM Channel for the first time in the Netherlands.
MGM plans that both those channels present round-the-clock offerings from its celebrated 4,000-title library, which includes Annie Hall, Bull Durham, The Fortune Cookie, Last Tango in Paris, The Manchurian Candidate, Midnight Cowboy, The Misfits, Moonstruck, Network, Paths of Glory and The Pink Panther.
MGM now has branded channels in Latin America, Europe, India, Israel, Turkey and New Zealand as well as the Middle East and South Korea. Most of those deals were made directly with a satellite or cable operator to “simplify the deal.”
“We have found it necessary to go as close to the course of revenue as possible in order to keep things from becoming too complicated,” Mr. Tuchman said. “We normally tend to approach major cable or satellite providers in a market and partner with them, so we are able to execute our plans quickly and smartly.”
“It was imperative for us to not invest huge sums of money in establishing these channels “Mr. Griffiths added. “Bruce has brought in a very good team that will ensure that the world’s best library will help us expand our distribution relationships throughout the world.”
MGM continues to sell from its huge library to other TV and cable outlets, so there is no antitrust concerns or hard feelings. Mr. Griffiths said the library is so large it is not a problem. However, these days deals are done for a relatively short term. Under previous management, production and library output deals with foreign countries ran for as long as10 years. Today most are for six months to three years. “We don’t want to do long deals,” Mr. Griffith said. “We want to be in a position where we can use our strongest assets to build the company.” With tastes and cultures running stark contrasts from market to market, Mr. Tuchman said that one key top success was to customize programming based on that region’s tastes and competition, with some channels subtitled, while others are dubbed to best mix with audiences.
Although the channels are all movies so far, that may change down the road. With MGM’s handling international rights to NBC scripted programming, Mr. Tuchman noted that adding U.S. shows to the mix remains an option down the road. Branded channels featuring westerns, romance and so forth are another option, but for now expansion remains the hot button.
“There isn’t a territory I’m not looking at right now,” Mr. Tuchman said. “But we won’t sell our soul to do it. Our primary interest is to build assets that we own and control, because this library is just too good to give away.”