Studios Wary of Short Orders in Long Run

Feb 2, 2004  •  Post A Comment

Beaten down by the big numbers that short-run reality series pull, several of the broadcast networks have expressed interest in developing short-run scripted series, which could be promoted to viewers as special events rather than long-term commitments.
But whether studios will be there to meet that demand remains to be seen.
Studios typically deficit series for broadcast networks and make most of their money off back-end syndication sales. With the standard broadcast network order of 22 to 24 episodes a year, it usually takes about four seasons before a series can be sold into syndication. If a network orders only eight to 13 episodes a year, it could take twice as long to hit syndication.
Studio executives say they are open to producing short-order series, but most agree that the financial model would have to change so the studios wouldn’t be assuming greater risks.
“The studios will definitely do their homework before they accept that short order and make sure it is the right project and one where they can make money on it,” said Darryl Frank, co-head of DreamWorks Television, which has produced 10- to 12-hour miniseries for cable networks, such as “Band of Brothers” for HBO and “Taken” for Sci Fi.
Pay and basic cable networks’ standard order for series is 13 episodes, but most of those are produced in-house because not many major studios are willing to deficit cable shows, which have virtually no back-end value. Cable networks typically pay license fees similar to those paid by broadcast networks, but the series they buy are cheaper for studios to produce because pay scale rates for talent are lower for cable series than for broadcast series. For example, had FX’s “The Shield” been produced for a broadcast network, it would cost about $100,000 more per episode because the studio would have to pay rates based on the broadcast scale.
If broadcast networks want shorter-run series, they may have to pay higher license fees to studios to get them.
“I don’t think this model is easy to figure out [to produce] fewer than 22 episodes,” said Gary Newman, co-president of 20th Century Fox Television. “To make sense out of it, [the network] is going to have to be prepared to take more of the financial risk so that we’re not out there risking an enormous amount of money hoping to get to eight or 10 seasons hoping to have a powerful syndication package.”
Despite the difficulties, he said, “It feels as if there is a need to figure this model out. 20th and I’m sure the Fox Network both intend to explore this and see if we can’t find a way to make it work.”
In addition to the license fee paid by a network, studios must evaluate whether other potential revenue streams such as international sales and DVD appeal make a show worth producing.
“One of the big financial opportunities in that model is to sell it internationally as a miniseries,” said David Kissinger, president of Universal Television Productions. “If you can succeed at doing that, depending on the property, there is real upside to be had.”
DVD sales can take some pressure off of producing a short-order series. “It’s by no means a guaranteed revenue stream,” Mr. Kissinger said, but “at least it’s a potential revenue stream that makes these kinds of projects more conceivable.”
At the Television Critics Association press tour in January, ABC executives said they were positioning their current midseason offerings-13 episodes of “Stephen King’s Kingdom Hospital” and four episodes of “The D.A.”-as event series to try to get viewers to sample the shows.
While both series were developed as midseason shows with the goal of a 22-episode pickup for next season if successful, ABC Entertainment President Susan Lyne said network executives are evaluating this year’s scripts and pilots to see whether any of them lend themselves to be developed as short-event series.
Several short-term series are already in the works at broadcast networks. ABC has ordered “Empire,” which tells the story of Julius Caesar’s teenage nephew Octavius, from Touchstone Television and Storyline Entertainment. ABC ordered eight episodes and has the option to order more seasons, although none of them would likely be greater than 13 episodes.
NBC is developing a six- to eight-hour series about the battle between God and Satan that is drawn from the Bible’s Book of Revelations. If successful, it could return to NBC’s schedule as another shortened series or weekly series.
Short-order series can offer creative benefits to writers and actors, who are able to tell a story from beginning to end and don’t have to draw it out indefinitely. They also might appeal to feature film talent who don’t want to commit to the grind of a full television season.
“That is going to be very appealing,” Mr. Newman said. “If you can make it an event and bring in auspices that are meaningful, in a way it’s sort of a new form of the miniseries.”
While there are creative benefits, there’s also a downside. Writers and actors usually get paid on a per-episode basis, so if a studio isn’t making as many episodes of a show, the talent doesn’t get paid as much. Creative talent also might balk if the studio and network want them to sign options for future seasons because they would be giving up their television exclusivity while getting paid less money per year than if they were in a traditional 22- to 24-episode-a-year series.
Despite the obstacles, short-term series could be a profitable form of business, especially within a vertically integrated company. A studio could end up producing a short-order series for its sister network at a deficit if it’s for the greater good of the parent company. For example, a hit short-order series would drive up the network’s ratings, which in turn could raise ad rates for the network.
“The importance of a network’s success within a large, vertically integrated company can’t be underestimated,” Mr. Kissinger said. “It drives so many other things. Once we are officially under the same roof as NBC I suspect you will see that decisions like this will be evaluated, with the network’s interest being paramount.”