How Can Traditional TV Networks Compete With Streaming Services’ Mega-Deals?

Variety | 5/16/2018 | Michael Schneider
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If Shonda Rhimes’ deal with Netflix was the initial shot heard round the industry, Ryan Murphy’s was the nuclear bomb. The one-two punch of losing two of the most prolific and successful mega-producers to their streaming rivals has given the linear networks even more reason for anxiety in an increasingly fraught landscape.

“The Shonda-Netflix deal was a game changer,” says Fox entertainment president Michael Thorn. “Just that amount of money” — a multiyear pact worth at least $100 million, although insiders contend it’s even more — “to develop at one place, it definitely raised the bar. For the studios that want to make overall deals as part of their business, it’s going to be really competitive.”

Netflix - Upwards - Years - Company - Hundreds

Netflix plans to spend upwards of $8 billion on programming annually in the coming years, which explains why the company didn’t flinch at shelling out hundreds of millions of dollars for Rhimes and Murphy — with additional deals likely to come.

“I would look at our overall deals as a way we’re continuing to develop IP,” says Netflix chief content officer Ted Sarandos. “Instead of buying companies and buying a factory, really you’re buying the ability to create [intellectual property] together with Shonda, with Ryan, with Jenji Kohan.”

Sarandos - Notion - Anything - News - Talent

Sarandos disputes any notion that this is anything but good news for the talent and those who rep them. “A lot of people talk about Peak TV as a pejorative,” he says. “I talk about it as a complete celebration. If this is Peak TV, I’ll take more ‘peak.’ It’s the best time in the history of television to be a producer and a creator.”

But the traditional outlets are at a distinct disadvantage, without the deep pockets to mount a counteroffensive. As the networks announce fall schedules at their upfronts, it’s also the time of year when many studio deals...
(Excerpt) Read more at: Variety
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