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Oscars on TV: Statuette Can Mean Bigger TV Fees

Feb 7, 2005  •  Post A Comment

Winning an Academy Award often translates to box office gold, and when it comes to attracting television license fees, Oscar is definitely a supporting player.

That’s because such fees are often tied to a film’s box office performance, which in turn, usually jumps if the film wins a major award.

“A nomination and a win can make a picture extremely more valuable, specifically if you’re talking about pictures that are not runaway hits,” said Eric Frankel, president, Warner Bros. Domestic Cable Distribution. “Since many deals are based on box office, the recognition of the nomination or win increases the box office and makes it more valuable.”

Mr. Frankel said nonblockbuster films such as “Chariots of Fire” or “The Killing Fields” increased their box office total by more than 20 percent after winning an award. In the case of some nonblockbusters, ticket revenue doubles or triples.

If a film is sold in advance of the Academy Awards and is honored by academy voters, a network could end up paying more than expected for its rights.

On top of that, some studios seek contract terms that provide bonus license fees should a picture win a major award, usually best picture or best director. But those bonuses were bigger and more widespread a few years back, and some buyers today say such a deal point would be unacceptable.

Last year’s best picture winner, “The Lord of the Rings: The Return of the King,” did not have an Oscar kicker in its deal. New Line sold all three films in the series to The WB and Turner Broadcasting long before the Hobbits took center stage at Hollywood’s Kodak Theatre.

“It’s done picture by picture,” said David Spiegelman, senior executive VP of domestic television distribution and marketing at New Line. “Sometimes you have a clause, sometimes you don’t.”

Winning an Oscar is always a positive, Mr. Spiegelman said, but what really determines the salability of a film is “how well a network believes it will perform on its air.”

Networks acknowledge this. “There is added value, and occasionally a movie has so much buzz, and an early negotiation ensues where you can directly say that the price has been enhanced because it’s been an award winner,” said Bob De-Bitetto, senior VP of programming for A&E Network.

Mr. DeBitetto cited the film “Chicago” as an example. Miramax sold “Chicago” to NBC and Bravo in a deal that was announced the day after the film won the best picture award in 2003.

“They made a deal while the news was hot off the presses,” Mr. DeBitetto said. “The movie’s recognition was part of the factor of that deal being made when it was, and it probably helped the price tag.”

NBC reportedly paid $13 million for rights to “Chicago,” less than 15 percent of the film’s domestic box office at the time. The price might have been even higher except that buyers generally believe musicals do not attract ratings the way action films do. NBC also bought the film for three years, instead of the normal five-year window.

Mr. DeBitetto said it has been harder for the studios to get 15 percent license fees in recent years, but “being an award winner can help mitigate against the downward [pricing] pressure.”

There are also questions about how long the Oscar glow lasts. “It’s all wonderful, but that electricity and that excitement have long dissipated by the time that movie is going to be on broadcast television or cable television,” Mr. DeBitetto said.

He said networks can bring some of that back by promoting movies as Academy Award winners. “Awards matter to viewers. It’s just that at a certain point, a number of years after the fact, the correlation between ratings and viewership and awards becomes fairly attenuated,” he said.

At Oxygen, an Academy Award-winning performance helped drive one of the network’s highest-ever

ratings.

Last March, one day after Keisha Castle-Hughes appeared at the Academy Awards ceremony as the youngest best actress nominee ever, her film “Whale Rider” appeared on Oxygen. The premiere drew a 1.23 rating, representing 690,000 viewers, according to Nielsen.

“As a programmer, we love it when movies win awards. You really get a lot of extra eyeballs checking it out, because a lot of people don’t necessarily see things in the theater,” said Deborah Beece, president of programming for Oxygen.

Mr. Frankel of Warner Bros. said winning an Oscar can mean that instead of a movie debuting on a network like Independent Film Channel, which is digital and commercial-free but reaches a relatively small audience, it becomes attractive to a channel like Lifetime or A&E, which can pay more.

An Oscar is also like an annuity in that it ensures that a film will stay on the air and be part of movie packages for a long time. Since winning Oscars, films such as “Driving Miss Daisy,” “American Beauty” and “L.A. Confidential” have been on the air regularly.

“They’re always licensed and always out there,” Mr. Frankel said. “Instead of a little feature, it’s a big, important picture.”