Partnerships, Tests Define New Syndie Model

Today, syndicators and TV station group owners are no longer merely sellers and buyers of first-run programming and off-network TV shows, including at NATPE, the syndicated TV marketplace that kicked off today in Miami Beach, Fla. Instead, they are increasingly partners who work together toward a common goal: finding TV viewers, locally and nationally, who have a growing number of multiplatform viewing options to take their attention away from TV sets.

But syndicators and TV station groups also are increasingly facing an uneasy shift in power as TV station groups often get the upper hand over syndicators in negotiations as station consolidation results in huge groups like Tribune Broadcasting and Sinclair Broadcast Group, both of which acquired other groups in 2013.

That was the focus of the NATPE panel “Game Changers: How Station Groups and Syndication Execs are Responding to 2013’s Tectonic Shifts,” with CBS Television Distribution’s Hilary Estey McLoughlin, Debmar-Mercury’s Ira Bernstein, Tribune’s Sean Compton, RBC Capital Markets’ David Bank and Rentrak’s Steven Walsh.

TV station consolidation is partly to explain recent partnerships such as CBS Television Distribution working with Tribune on syndicated shows Arsenio Hall, The Test and the recently concluded trial run of conflict-resolution show Serch with MC Serch on eight Tribune Stations.

“It has helped companies like ours,” said Estey McLoughlin, president of creative affairs at CTD. “It’s good for long-term brand building. The partnerships have the stations much more invested in the shows. That gives a show a much better chance to succeed.”

And Compton, Tribune’s president of programming and entertainment, added: “You champion a show you’re part of. It’s the difference between owning a car and leasing one.”

He said partnerships can result in syndicators creating shows that fit Tribune’s needs. “We were looking for a comedy for early fringe. Ira [Bernstein] came to us with Celebrity Name Game. We created a deal [with Debmar-Mercury], where we said to Ira, ‘We can give you 40% of the country.’ ” He was referring to Tribune’s stations reaching more than 40% of TV homes.

“Over the past 12 months, broadcast became the new cable,” said Bank, managing director and global media equity research analyst at RBC Capital Markets. “Consolidation allows for more leverage in buying. The massive retrans consent fees [cable operators pay stations] has really redefined their ability to monetize broadcast TV. It’s a better business model.”

“There is equity and risk capital in the beginning,” said Bernstein, co-president of Debmar-Mercury. “That translates into an investment, a license fee. With Tribune we’re working together on the production of the show and on the back end.”

“The partnerships have become more involved,” added Estey McLoughlin. “There are all sorts of business models. But no one can forget that our job is to make a show work. You have to make it work on a local basis and on a national basis, which is the biggest challenge.”

The downside for syndicators of these partnerships, she said, is that it can be tough to launch a show if a large station group doesn’t sign on. “It will be challenging from a barter standpoint to launch a show without these groups,” she said.

Related to partnerships are tests, which have become common since the summer of 2008 when Debmar-Mercury tested its now successful Wendy Williams Show on Fox stations.

“In daytime, we started with Wendy Williams,” Bernstein said. “You look at the creative. Can she do it? Then, you look at the numbers. On Wendy, her numbers were huge in New York. In Dallas, where no one knew her, we started out doing 0.6 but doubled that by the end of the test. We decided to go with the show and, obviously, we’re very happy with that decision.”

CTD just finished testing Serch. The show is available for fall 2014 broadcast syndication. “Testing is here to stay,” said Estey McLoughlin. “The downside is the lag time between the test and getting on air. You want to keep the momentum going. We started Serch in January [instead of the summer], so that the lag time is less to get it cleared and on the air.”

Compton said the Serch test did OK. “We were very impressed with the returns on the show,” he said “It’s not about its performance versus a station’s performance last year. You look at the quarter hour. For us, it was about: Is he good on camera? We like the show.”

Meantime, off-network sitcoms still have appeal for broadcasters, said Compton, but less so as other platforms — cable TV, SVOD — drain off some viewers.

“[Sony’s] Seinfeld is in its fifth cycle and it still gets cash,” he said. “It gets barter and cash. But it’s not over exposed. We run it in late fringe. We air it only twice a day. That’s it.”

“With Tyler Perry, we tested in a different way,” Bernstein said. “We tested 10 episodes and had the stations commit to 90 more if it works. A network can be a buyer. Fox just said they’re not doing pilots any more. Everything is changing.”

Another huge shift in TV viewing is viewers using social media as they watch TV. In some instances, social chatter has attracted viewers who weren’t previously watching a show.

“There’s a whole process with social media and other ways that audiences find a show,” Estey McLoughlin said. “Stations have to be patient. Older people find shows in the beginning. But it can take a while with younger audiences.

“You hope there will be something that will resonate that brings people back to the show,” she said. “It’s very hard to design something that will go viral.”

Bernstein noted that a clip from Wendy recently went viral, not by design. “Wendy is live every day,” he said. “She cried the other day over something. That went viral online and then she was on The View talking about it two days later.”