confidential draft spe worldwide format business may 27, 2008
TRANSCRIPT
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• Non-scripted television represents a compelling growth opportunity for SPE
• Success requires global coordination and further investment to reach scale
• We need to manage our investments as a unified global business, including:
– Expanded portfolio of content producers
Embassy Row will serve as the cornerstone of domestic development;
complemented by investments in third-party EP and production company deals
2waytraffic and our equity stakes in smaller production companies will provide
international development capabilities
– Global acquisitions team, including executives from Embassy Row and 2waytraffic
– Dedicated staff to manage global ad integration
– International distribution led by 2waytraffic
Executive Summary
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Demand for Game and Reality Formats Continues to Grow
NOTE: A 6-year trend of reality/game shows as a percentage of primetime hours for the 5 major networks.
Game / Reality as a % of Primetime Hours
Game/reality shows make up 14 of the top 40 primetime programs among Adults 18-49 and represent 30% of the top 20 primetime programs among Adults 18-49
8%
19%
13%
16%
21%
24%
0%
5%
10%
15%
20%
25%
30%
2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009
Per
cen
tag
e %
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• Non-scripted programs are usually less expensive to produce
Business Dynamics are Attractive
Growth• Format business continues to grow as broadcasters increasingly rely on hit
non-scripted formats
Lower Cost
Interactivity• Polling, voting and games increase viewer engagement and time spent with
show brands
Global• International and domestic markets are closely linked (30% of scripted; 29% of
reality broadcast pilots are adapted from international formats)
Cross-Platform • Shows offer ancillary profits (mobile games, online games, SMS)
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Network
Number of weekly primetime hours that are reality/game shows (08-09 Season)
Percentage of primetime hours that are reality/game shows (08-09 Season)(1)
Notable Series on Primetime Lineup (08-09 Season)
6 ½ 30%
• Dancing With the Stars (2 ½ hours)• Wife Swap (1 hour)• Super Nanny (1 hour)• Extreme Makeover: Home Edition (1 hour)• Opportunity Knocks (1 hour)
5 23%• Biggest Loser (2 hours)• Deal or No Deal (2 hours)• America’s Toughest Jobs (1 hour)
6 40% (2)
• Cops (1 hour)• America’s Most Wanted (1 hour)• Don’t Forget the Lyrics (1 hour)• Kitchen Nightmares (1 hour)• Moment of Truth (1 hour)• Are You Smarter Than a 5th Grader? (1 hour)
2 9%• Survivor (1 hour)• Amazing Race (1 hour)
3 23% (3)• America's Next Top Model (2 hours)• Stylista (1 hour)
Networks are Investing In Non-scripted Programming
(1) Based on a 22 hour week unless otherwise noted; based on Fall programming
(2) Fox based on 15 hours (does not program the 10-11 hour); excludes American Idol which debuts in January
(3) CW based on 13 hours (programs 8-10 M-F (10 hrs) plus 3 hrs on Sunday)
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Domestic
CategoryPotential Partners
Term (Yrs.)
Cost / Year (MM) Genre Notes
AcquisitionEmbassy Row (Michael Davies) Acquire $25-75
Game Show/ Reality
• Acquire Embassy Row • New York based global format and digital production
company • Created “Who Wants to be a Millionaire” & “Power of 10”
Executive Producers (1-3 of these)
Scott St. John 2 $3 Game Show • Executive Producer of Deal or No Deal
Tom Foreman 2 $2.25Reality/
Competition
• US based producer • Created “Kid Nation” & EP on “Extreme Makeover Home
Edition”
Allison Grodner 2 $2Reality/
Competition• Executive Producer of “Big Brother”
Lisa Levenson 2 $1.5Reality/
Competition• Executive Producer of “The Bachelor” and “The
Bachelorette”
Production Company
Ryan Seacrest 3 $3-$5Reality/
Competition
• Hosts the morning show on 102.7 KIIS FM in LA, host of “American Idol”, “E! News” co-host and host of American Top 40
• Overall deal similar to “Old Reveille Deal”
Production Company (1 of these)
Rocket Science Laboratories
1 $2-3.5Reality/
Competition
• Creator of “Temptation Island”, “Joe Millionaire”, “My Big Fat Obnoxious Fiancé”
• Overall deal
Jay and Tony 2 $2-3.5Reality
Competition
• EPs on “High School Musical: Summer Sessions,” “Here Come the Newlyweds,” “Dane Cook’s Tourgasm”
• Overall deal
SPE Will Continue to Expand its Network of Domestic Producer Partnerships
Acquisition
Annual Spend
$25–75MM (one-time)
$2–6MM
$3-5MM
$2-3.5MM
$7–15MM
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SPE Global Game/Reality Operational Structure
Embassy Row
Game/Reality
Domestic Dev. Execs Cross-genre
Domestic Prod Cos (Partners)
Cross-genre
Domestic EP Partners Reality/
Competition
2waytraffic Game Focus
International Dev. Execs Cross-genre
International Prod Cos (1)
(Investments) Cross-genre
Embassy Row 3 new hires (UK/Scandinavia; Australia; South America)
2waytraffic
(1) SPTI’s worldwide production and distribution offices are complemented by investments in international production companies including: Starling, France; Lean-M, Russia (51%); Shine, UK (20%); Tuvalu, Netherlands (51%); Huaso, China (JV)
Dedicated Staff (New hires)
2waytraffic (And existing SPTI Staff)International Distribution
Ad Integration
Content
Development
International Acquisitions
Manage all assets as a single business with a dedicated P&L