Crazy cash and snackable shorts: The future of entertainment on SVODs

As the likes of Netflix, Amazon and Quibi begin to get their unscripted affairs in order with heavy-hitting greenlights for global-facing shows such as The Circle, Back Of The Net and Elba vs Block, their strategy remains frustratingly opaque. TBI gathered some of the best creative minds in entertainment and formats to shed light on their experiences with the SVODs. Are the days of “crazy cash” over for Netflix? What is Jeffrey Katzenberg looking for in an entertainment offering on Quibi? Does Amazon stand a chance of catching up in the unscripted arena? By Manori Ravindran

What does the future of unscripted on streamers look like?

Lisa Perrin, Endemol Shine Group: What Netflix is doing with The Circle is interesting. They are doing a hub in Manchester and flying in the Brazilians, French and Americans – and doing it in real time, with one episode a day, rather like Big Brother. But 18 months ago, I wouldn’t have thought that’s something they would have gone for. It’s going to be interesting to see how that works. They’ve yet to crack their big shiny floor show, but they will. People will binge-watch a quiz show now – they will binge-watch something they like no matter what the genre is

David Flynn, (Youngest Media): The interesting thing we’re finding is that, as well as those binge-watch shows, now streamers also need shows for people who have 30 minutes and don’t want to get into something they can’t stop watching, but rather something that will really entertain them for that 13 minutes they have spare. The tradition of snackable shows is coming through. But the competition in OTT is only heating up, and they all need their tentpole pieces to sell in a competitive market. And some of those pieces are drama, but entertainment can be that tentpole as well

LP (ESG): When we’ve spoken to Netflix commissioners, [they have said] Nailed It! is their biggest show. And that’s why the budgets are coming down on Netflix, because that was done for an awful lot less than The Crown. It will be interesting to see how it works when they roll it out in local language, but as a format for them, it’s done incredibly well. It’s not really cooking – it’s a comedy entertainment show, and it’s a hit with their young audience

“I was short-form commissioner at the BBC in entertainment, and Quibi have got right straight away what we wanted to do at the BBC but were restricted by the cash.” Sohail Shah

Sohail Shah (Elstree Studios): I also love Sugar Rush, and what’s clever is that at the end of each episode, they say, ‘If you enjoyed that, there’s another one coming up’, and it just starts. So you watch another one

LP (ESG): I love that niche thing they’ve done. The glassblowers show on Netflix, Blown Away, is fantastic. You just think, ‘Why am I watching this thing about bloody glass-blowing? But I am’. It’s so clever

Michelle Chappell (Workerbee): It’s great because no terrestrial would have put that on

How is Netflix beginning to localise in regards to entertainment?

DF (Youngest): When you start looking at how Netflix is thinking of local content, for a company like ours that is expanding into the international marketplace, that sort of injection of energy, cash and enthusiasm in those local markets has a brilliant effect in that everyone feels like they want to up their game. Everyone starts to look at original content as a way to differentiate themselves

LP (ESG): But they realise it needs to be tonally different in different markets. You can’t just lift an American format and make it in German and assume it will work, because it won’t cut it. You do have to localise it. They’re one of the first streamers to recognise that. Amazon will also do so as well – they have a strong local team starting

Endemol Shine recently sold Family Food Fight into Brazil, for broadcaster SBT and Amazon Prime Video. What else are you working on with them?

LP (ESG): We also did a deal with Amazon for comedy-variety series Last One Laughing. We are doing that in Mexico, Australia and a couple of other markets

We are totally work for hire. They own the format. But we’ve taken a view that we want to be their work for hire in those markets and that’s something we’ve decided to go for. We also have some other original development in both through the US and through Georgia Brown in London. That seems to work OK

SS (Elstree): I was asked by a company to help them with a children’s idea they wanted to flesh out for Amazon, and they have gone for it. It goes into production in November. I found it very easy to flesh out their idea but in terms of what Amazon required to do so, I didn’t think it was anything I wouldn’t have expected them to ask for. But I got the impression that they were learning what they should be asking for based on what we were pitching. Because it’s so new to all of us. Now that their team is in place, they will be more forthcoming and clearer in what they are looking for

Workerbee had the first UK commission from Quibi and was the first company to start delivering cuts to them. Tell us about that experience

LP (ESG): We were there at the pitch with Jeffrey Katzenberg in February in London. They all waltzed in and it was quite a big deal. Everyone traipsed in and did pitches with them.

“Netflix knows they have to pay a premium because they’re paying for producers for hire and taking rights off the table, so they’re prepared to pay a bit more, but those days of crazy cash are definitely gone” Lisa Perrin

MC (Workerbee): It’s quite amusing. [Workerbee MD Rick Murray] was away and I was on jury service and we sent our poor head of development up to pitch to Katzenberg, but he had a great idea so we thought, ‘Well this is going to be fine’. And it was, because when you have a great idea, it sells. He pitched Elba vs Block and he had a great bit of tape and [the Quibi team] just thought ‘Idris Elba, brilliant’ and they backed it. It was very quick.

Within six weeks, it got over the line, and then we were in production six weeks later. Because we were the first to start delivering cuts, that was interesting because we were figuring it out – should there be closed episodes, cliff-hangers, series arcs? All those bits you’re trying to wrestle with. Initially we started to deliver 10 minutes, and in the end the cuts were five minutes long. We were told that the average 16 to 24-year-old watches content for six minutes and 50 seconds. Katzenberg then watched some cuts and, to summarise it crudely, he just said, ‘I want it louder and I want it quicker’

At what point did he get involved?

MC (Workerbee): At the fine-cut stage, he just watched over them, which is great. They give quite light-touch notes but they’re really constructive. They’re just fun to work with

DF (Youngest): The interesting thing with Quibi is that it’s the most amazing creative challenge and liberation to say, ‘We need to think differently about duration’. But it’s not just US streamers; we’ve just delivered HouseShare for BBC Three and that is 23-27 minutes, depending on what the episode needs. And across the board, the OTT delivery allows us to be free in terms of how we create

MC (Workerbee): Suddenly making it vertical as well is quite interesting, because it’s both vertical and horizontal. You find that enhances the storytelling because you’re looking for other ways to show [the action], so you might have lots of split-screens and lots of different angles on one vertical page. It actually makes you think more creatively about a product, which is quite good

How did you manage technically? Was that all in the edit stage?

MC (Workerbee): Yes, in the edit. We delivered two versions. But we’ve had to play along as we go. It’s the vertical challenge

DF (Youngest): We’ve been talking with Quibi and we found that they’re quick and up for good ideas. We came idea-first to them and they will engage at that kind of level because much like all SVODs, no one knows yet what will work in the entertainment space for streamers, and the only way we can work it out is by trying things out

The rights situation is interesting, because the rights are returned to you after a period of time. What will you do then with that content?

“At MIPCOM, we’re going to bring back I Survived A Japanese Gameshow and present that to the streaming platforms. But it’s the risk of, ‘OK are we going to make more money by doing that in 13 territories or 25 territories?’ That’s the risk” Tim Crescenti

MC (Workerbee): You can repackage them. It’s perfect. For something like Elba vs Block, obviously we have shot a lot more than what’s going to go out, so when we do repackage, it’s almost like a whole different programme with much more narrative. They’ve really thought about what makes them different

Tim Crescenti (Small World IFT): So, when you’re producing the show, you’re thinking, ‘Okay, these are 10-minute segments,’ but you’re also thinking how will it work when you repackage this

MC (Workerbee): On the next one, we’ll be more forward-thinking on that, but for this one, things happened on set that we captured but which were too nuanced to put in the 10 minutes, but brilliant in the long form. Next time, we might plan slightly differently to account for the long form as well.

They said to us, too, to view cuts on our phones. Though we did look in the edit as well (laughs)

DF (Youngest): Good point. You can think something is incredibly clear, sitting in an edit with a big screen…

MC (Workerbee): …But then the kids are watching it on their phones

DF (Youngest): You’ve got to have that viewing stage and look at whether things like subtitles are coming across properly

MC (Workerbee): Colours are also very important and can really punch through on the phone. And Quibi involved us in all the marketing as well. It was brilliant to be involved in that, when you wouldn’t so much in the terrestrial digital space

SS (Elstree): I was short-form commissioner at the BBC in entertainment, and Quibi have got right straight away what we wanted to do at the BBC but were restricted by the cash. Now there has been a cash injection so things have changed, but I had people pitching nice ideas to me, but short-form had a challenging budget. However, the idea and lengths would have been the same, in theory – between 5 and 10 minutes.

The difference is Quibi is giving you the cash to be able to realise what you want us to see in a really, really good way. They’re brilliant, and I look forward to seeing what we can do with it; it just guts me that we couldn’t do it on BBC Three, because it’s what we wanted to do

DF (Youngest): I think, though, as producers we now need to be flexible to be able to work with, in a perfect world, both Quibi and US networks, but also BBC Three and the online distribution platforms whose budgets are even smaller than those short-form ones. You have to think about how to ready your team for that, and whether the tech is there in terms of the way you can turn things around, how you can shoot things, and have edits in the office. You have to be careful you’re not putting everything towards these new providers

How do you go about pitching to these platforms when they’re commissioning extremely niche programmes but also more wide-appeal offerings?

LP (ESG): We’ve started doing some multi-territory pitching. We’re doing non-English language pitches all together, so it feels very joined up for them right from the very beginning, which seems to have worked for some streamers, knowing that local language is something that they want

How does that work?

LP (ESG): If we come up with a great format idea, we go in with our German, French, Spanish and Italian partners. So, you go in as a multi-language, non-English language pitch, which for Netflix and Amazon is important because they’ve hit a limit in the US and UK and the Nordics are completely saturated – all these countries watch the English versions. So, the big subscription uplift is non-English language, that’s why there’s a massive opportunity. So for us, going in on multi-territory with a format everyone wants to make seems to be working

MC (Workerbee): It is different developing for the SVODs, because you only get that one shot. Everything has to be locked down with the talent. The idea of going in with a few top lines – you might as well just get out of the room now. It has to be fully formed. They don’t really develop in the room first straight away – they’ll develop with you later – but it’s really that one shot

LP (ESG): The tape has to be excellent. You have to spend a lot of money, and once you’ve shown it once, it’s done. As traditional developers, you make a tape and you think you can show it to BBC One, Channel 4, Channel 5. Now you have to specifically make it for a Disney+ or Netflix, because tonally it’s very different. Especially a Disney+ is very different. You’re burning through a lot of ideas and a lot of tape time. It costs a lot of money.

But, to be fair we’re doing something with Netflix, where they looked at it and they went, ‘We love that picture’ and it sold

“Katzenberg then watched some cuts and, to summarise it crudely, he just said, ‘I want it louder and I want it quicker’” Michelle Chappell

DF (Youngest): That’s the other part of it. That front image has become more and more important. Popping on a screen amidst major choice is a real challenge. You should be thinking about that visual at the pitch stage, and what the visual can add

SS (Elstree): Netflix changes their thumbnail constantly for shows – it’s all dependent on the algorithm

What’s new with YouTube?

LP (ESG): We are getting some traction. Remarkable Factual has done a big virtual reality history series, which is amazing. They’ve come up with this innovative way of using VR. YouTube has dropped the paywall and they’re leaning into premium education. Locally, there are a couple of markets they’re really looking into as well

What markets are they targeting?

LP (ESG): YouTube is looking into Germany for German local language, as well as Spanish local language. That’s the main push. Germany is getting a lot of interest because it’s a wealthy country with a big middle-class and big population. Tonally, it’s very different in how people watch TV, so all the streamers feel like Germany is an opportunity. Amazon, Netflix and others all want to commission German local language
As a distributor, how do you navigate – and negotiate – sales into streamers?

TC (Small World): At MIPCOM, we’re going to bring back I Survived A Japanese Gameshow with a turnkey production hub and present that to the streaming platforms. But it’s the risk of, ‘OK are we going to make more money by doing that in 13 territories or 25 territories?’ That’s the risk. Another thing is, if you get a deal with these streamers, they will give you China which is nice, but we can’t sell into China, so thank you for that (laughs)

LP (ESG): For us, as a group, we always look at the formats we’re pitching and think, are they the right formats for the streamers, or are they formats that could potentially be rolled out in a more traditional way? But ultimately, the creatives just want the ideas made. Netflix, Amazon and Quibi are all very sexy places to play – why wouldn’t you want your content up there? So you’re hardly going to say to people, ‘You can’t pitch that’. You have to think ‘horses for courses’

DF (Youngest): It’s a big choice, but for The Circle, it feels like Studio Lambert made a very good choice to drive it through Netflix. They have been very supportive

How have budgets fared in recent years? Amazon reportedly paid up to $250m for The Grand Tour. Are we still looking at these types of deals in unscripted?

MC (Workerbee): They’ve got a pyramid of different tariffs, and the top is really expensive. The budgets are very good

TC (Small World): Whatever Amazon paid for The Grand Tour, you’re never going to get that deal anywhere

LP (ESG): I think the days of crazy cash are gone. Netflix understood that there was a Crown Effect, where they overpaid for that massive bankable thing that I’m sure they’ll make their money back on, but it slightly skewed the drama market and they’re very aware – particularly as they go into other markets – that they have to keep the market rate, and to benchmark what the French market rate is, and what the German rate is

They know they have to pay a premium because they’re paying for producers for hire and taking rights off the table, so they’re prepared to pay a bit more, but those days of crazy cash are definitely gone. But it makes sense: they only have a finite amount of money which has to go to more countries with more content. People burn through because audiences binge-watch. So, they’re constantly running, which is great because they want content, but they’re going to spread that a little bit thinner. What’s interesting is that this is happening right when we begin to see a drop-off in US subs for Netflix, as per the most recent results

LP (ESG): Yeah, and unless you’ve got a Disney+ deep-pocketed budget, it’s going to be quite interesting. It’s inevitable the budgets will be slightly more sensible and the margins will be smaller and they’ll have to look at perhaps doing Quibi-style deals. Certainly, budgets are lower than what they were two years ago

TC (Small World): Streamers initially want to make a splash so they do A-list celeb deals, but where’s all your money going if you’ve got someone like Justin Bieber? And also, when you attach someone like that, is there really a role for this person? Are we going to get Bieber’s 34m followers?

DF (Youngest): He’s very good in the edit, to be fair.