Digitalization is driving the cost of content creation to zero and the format business reduces the cost of failure, but the cost of content is still escalating… which is the justification for mergers and acquisitions. It’s a mess out there!
Two recent books, both, coincidentally, from Italy, are animating the international TV debate. One, Unbundling Entertainment, was written in English by Giovanni Pedde. The other, Gli scripted format (The Scripted Formats), was written in Italian by Maria Chiara Duranti.
Pedde is a Rome, Italy-based former entertainment lawyer and ex-SVP of Paramount Global Distribution. His digital-only book (reviewed in this Issue) is self-published (U.S. $9.99). Duranti, a format expert, is a professor at the University of Sacred Heart in Milan, Italy. Her book has been published both in print and digitally by Carocci Editore of Rome, Italy (16 euro or U.S. $19).
Duranti’s book makes the case for two types of formats: Scripted and non-scripted, with the former reserved for fiction (drama) and the latter for unscripted or “reality” TV shows. Both books describe their subjects’ histories well. Duranti credits the origin of format sales to Associated London Script, a company founded by Beryl Vertue, who licensed the first format — the BBC’s Hancock’s Half Hour — to Finland’s public TV network in 1960. However, Duranti doesn’t mention the fact that others have credited Italian-American Mike Bongiorno with doing it first, after he brought the American version of The 64,000
Question to Italian public TV in 1955 under the title of Lascia o Raddoppia? He also hosted the Italian version of the show.
The international licensing of formats was initially easier to do for game and quiz shows, but later, both reality and drama formats began to be sold, as well, often under the term “remake.” Meanwhile, in his book, Pedde explains how vertical integration failed, how technology caused people’s tastes to change, the “terrible deals” that the U.S. studios made to sell Netflix their library material (and make its streaming service a viable competitor), and how the streaming wars triggered a brutal consolidation endgame based on a “scale or fail” imperative.
Subsequently, Pedde argues that the entertainment industry is in the grip of two simultaneous, massive disruptions — the Internet with digitalization (which is driving the cost of distribution toward zero, circumventing the traditional middlemen), and generative AI (which is driving the cost of content creation toward zero).
All of these issues were predictable and predicted. Nevertheless, entertainment executives went ahead with them, and now the sector is paying the price. It would be nice to have a picture (or a book) of what the solutions should be, other than the oft-cited suggestion of further consolidation.
For Duranti, the challenge is less intense, but still important in view of Pedde’s review of entertainment’s massive disruptions (as he believes that digitalization brought the cost of content creation “toward zero”). Duranti believes that formats reduce the chance for failures (since the shows are already known to be successful elsewhere) and thus reduce costs. As for producers, distributors, and TV outlets, the cost of content is far from zero — it actually keeps escalating — and that is all the justification corporations need for consolidation.
(By Dom Serafini)
Audio Version (a DV Works service)
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