As the TV Drama Bubble Bursts, Producers Look to Indie Film for New Models
The bubble, that surge of cash that over the past decades helped bankroll an unprecedented boom in TV drama production, appears to have burst.
TV producers, gathered in Cannes this week for the MIPTV international television market, are pondering a future in which the cost of TV drama continues to spike while the primary sources of financing, namely broadcasters and online streamers, are slashing their commissioning budgets.
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“The cost of an hour of television drama in the U.K. has gone from £1.5 million ($1.86 million) to £2.5 million ($3.1 million) per hour, and you can’t finance that out of the U.K. market,” said Christian Baute of Headline Pictures, producers of Amazon Prime’s Man in the High Castle and Ten Percent. “Traditionally, over the last seven years, we went to America [for financing], but that money is ebbing [because] the American market is a mess.”
Morfydd Clark, who plays Galadriel in Amazon’s The Lord of the Rings: The Rings of Power was honored in Cannes on Friday with the Rising Star award of Canneseries, the TV festival that runs alongside MIPTV. But that sort of megabudget project — Amazon reportedly spent $465 million on the first season of The Rings of Power, a staggering $58 million per episode — now looks like a relic of another era. Rising inflation, soaring interest rates, and stagnant or declining subscriber growth for the big streamers have led to a perfect storm in which the old production and financing models — having shows fully financed by a global streamer or a single national network — no longer work.
“Streamers still have the same demand for the same amount of content,” noted Diego Ramirez Schrempp of Columbia’s Dynamo, a producer on Netflix’s Narcos. “[But] the bigger budgets are going to fewer projects, so we have to figure out how to co-finance and co-develop the rest. That’s a real change.”
In designing new models to meet the challenge, David Flynn of the independent production group WiiP, one of the producers of HBO’s Mare of Easttown, said the TV industry should look to the independent film business. Instead of counting on a single global streamer to cover all the costs of a big show, he says, series could be financed and sold “[by] getting an anchor tenant in a local network or broadcaster than partner that with equity and [international] sales. The same way we do movies.”
Flynn pointed to the British sitcom Toast of London, which WiiP produced with Objective Media Group, which used a similar, indie-film-style financing model, combining a local commission from the BBC with equity financing and then selling the series internationally.
Baute noted the financing structure for Headline’s Irish gangster series Kin was similar: with Ireland’s RTE as the local commissioning network, and the budget gap made up by international sales, handled through Fifth Season, to the likes of Viaplay for Scandinavia and AMC+ for the U.S..
“Trying to configure it, to make the finances work, was like doing an independent film,” said Baute.
“The challenge within the TV space [for this model] is that the TV sales market hasn’t quite adapted the way the film sales market has where you have film festivals where actors and directors come and meet with buyers,” said Flynn. “But I think that will be the evolution of the sales business because, ultimately, there’ll be a lot more independently financed shows, and they will need to have a place to sell them.”
Baute also sees a challenge for producers, who will have to “dig deep” to bankroll their own development, including commissioning scripts, and no longer be able to rely on networks or streamers.
“Seven years ago, you’d pitch an idea with a piece of IP and it would get optioned to a broadcaster or streamer, who would then finance the first episode script,” said Baute. “That time is really over. You need a lot more than a treatment now. You need to have deep pockets to develop and to find the right partners to develop with. You need everything in order to have all the options open and to retain rights.”
Another major hurdle for producers, familiar to the indie film business, is the rising cost of in-demand talent.
“The talent has been used to being paid vast amounts of money by the streamers,” says Flynn. “[The streamers] have disrupted the market because they flooded it with so much money. And now, they’re saying: it’s too expensive. Well, it’s their fault if it’s too expensive.”
But Flynn did see opportunity in the current market for the most creative independent producers.
“I think over the next period of time, smart producers will make shows for less money which will become very successful, which will then ignite [the industry] in the same way we’ve seen in film, where the Sundance festival was this big driver within the business, in launching new talent, talent, in figuring out how to get movies made for less money, and therefore giving the talent more creative control. I think a similar thing will happen in the TV space.”
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