Streamer deals were again on Screen Forever’s agenda on Wednesday, as a selection of prominent Australian producers shared their experiences of dealing with various platforms.
For the second year in a row, Stuart Menzies from Werner Films, Felicity Harrison from Matchbox Pictures and Emma Fitzsimons from Princess Pictures took part in a panel exploring the many considerations for producers, with the trio this time joined by Ben Grant from Goalpost Pictures.
Although details of a variety of different deals have been leaked, none of the services have been mentioned by name due to the real nature of the projects involved.
At the start of the session, Screen Producers Australia moderator Owen Johnston recapped findings from the previous panel, including that the traditional television funding and rights model was collapsing with the rise of streamers, who often fund projects entirely and want to take all rights – reducing the “long tail” or opportunity for producers to exploit intellectual property through secondary windows.
The industry was therefore in a period of transition, with transactions becoming “more complex” and questions being raised about the long-term sustainability of some production companies.
Speaking at the panel, Harrison explained how Matchbox had recently signed a co-production deal with an international streamer, allowing the two to co-own the IP. This involved license fees and the payment of a lump sum premium rather than a percentage of the budget. She said it was important for producers to do their homework before entering into negotiations so that they have an idea of the outcome that would work best for them.
As for negotiating a flat rate, Harrison said producers need to figure out what the right price is to ensure they make money.
“I think the interesting part of a co-production model, because there’s this shared ownership, we retain certain rights. We may take a distribution fee, and then from the revenue that’s separated from those rights, we then share it with the streaming partner. So there’s this ability to maximize,” she said, noting that Matchbox was able to retain almost all rights except SVOD, with a hold for one series plus four years.
Werner Film Productions recently signed two streaming deals: one was a co-production deal, where a distributor put up money for a second window with a three-year hold, and the other, the SVOD service “owned all “.
Menzies said his experience has shown that it’s a mistake to view any of the big streaming organizations as “homogeneous.”
“It’s opaque where these other doors are, let alone how to knock on them,” he said.
“But in this case, there was a co-production door. We went through that, and there were a whole bunch of things that allowed us to do. There’s also a lot of different rules in there, but that allowed us to retain the intellectual property.
Grant, who admitted to being a relatively new participant in the streaming rights negotiations, said discussions should not be simplified into what is possible with single-source funding versus multi-source funding.
“It’s about accessing the long tail that equity has traditionally provided us with, and that we’re trying to reinvent that in the future,” he said.
“I don’t really think fairness is the issue – that’s actually what it would bring. You could still have those things without equity. It’s just a business negotiation.
According to the panel, a permanent point of difference when working with streamers comes with residual payouts to cast members.
Under the Australian Television Repeats And Residuals Agreement 2004 (ATTRA), last update in 2016a three-year license term applies to the use of broadcast and digital works by performers.
However, Fitzsimons said streamers she’s dealt with have always asked for a longer period.
“We find ourselves negotiating many specific agreements with MEAA to try to figure out what we will do after the three years,” she said.
“Generally, I found the MEAA quite happy to move to a SAG-style residual after this three-year period.
“It’s complicated, but I hope a pattern emerges. I wonder if this could then be used as a template for a more comprehensive solution that everyone could access rather than having to negotiate individually each time which is exhausting.
His comments were backed up by Menzies, who said while opening the deal up to change “could take years,” it wasn’t a bridge too far.
“I don’t think any of us are arguing that ATTRA is suitable for any of these types of deals – it just isn’t.
“We all had to make bespoke deals with MEAA and it must be exhausting for them as well.
“There was a 2016 amendment, which allowed for national SVOD – basically the Stan amendment – and I think now there has to be something like that.”
A more immediate concern for Menzies in terms of future negotiations between streamers and producers was a “massive” increase in crew costs which could lead to the exclusion of Australian industry from the competitive market.
“Why are streamers going to come here with these explosive shows when we have 30% year-over-year price increases?” he said.
“We are getting seriously expensive on the world stage. I think we are not viable.
Adding to the comments, Harrison said it’s also worth keeping an eye on how the business of SVOD services is shaping the deals of more traditional broadcasters.
“I think we’ll be looking at our commissioning partners at ABC; they’ll also want SVOD-style rights. They’re naturally going to have to develop iview because that’s what consumers are looking for,” she said.
“But at the moment the way these rights are assessed through our guild arrangements is different. This too must change.
“So I think while there will be a lot of changes in streaming deals as these companies mature, we’re also going to have a lot of changes in traditional models. And as Stuart says, crew rates are expensive, everything is expensive. License fees do not increase; they need it, otherwise the partners will have to take more equity.
“It’s hard. There are a lot of opportunities because there are more choices, but everything becomes much more expensive.