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Hollywood's latest challenge: Getting foreign broadcasters to buy shows

At this year's annual TV bazaar know as L.A. Screenings, fewer media executives from abroad made the trip to L.A. to buy programming from U.S. studios -- and those that are here are spending less.

May 27, 2009|Joe Flint

Hollywood's annual TV bazaar known as the L.A. Screenings, where international broadcasters descend upon Los Angeles to buy the recently announced new fall shows, is underway.

But this year the studios can't count on the broadcasters for foreign aid. With the domestic market for TV programs contracting, overseas sales in recent years have become crucial in allowing the studios to recover production costs. But now that the global economy has become severely weakened, foreign broadcasters and cable channels are cutting back on the money they spend for new U.S. shows, which were unveiled by the networks last week.

It's just the latest setback for studios, which have been suffering from a steep decline in DVD sales. Because the vast majority of programs produced by the Hollywood studios for the networks are made at a loss, foreign sales have been an important factor in recouping the costs of production.

Not surprisingly, the 1,300 foreign media executives attending the weeklong sales event is down from last year's 1,400 -- and many of them are spending less, studio executives say.

"Unfortunately, the answer is everywhere," said Jeffrey R. Schlesinger, president of international television for Warner Bros., when asked about which foreign markets were proving the most difficult to muster sales. Canadian program buyers had already passed through the Warner Bros. lot over the weekend with much smaller wallets than usual.

"Prices were not at the level of the past two years," Schlesinger said. The United Kingdom and Australia are also challenged. Although new buyers have emerged recently, most don't have the deep pockets of the entrenched networks.

However, some foreign buyers may cut back on their own original productions in favor of outside content to lower their own risks, Schlesinger said.

"They have the same hit-and-miss ratio as we do, so buying from us is a safer way to go. . . . We give them $3 million an hour in value for a couple of hundred thousand dollars."

Stuart Murphy, head of programming for several of News Corp.'s Sky TV channels in the U.K., said that even though he has money to spend, the general market for U.S.-produced shows "is going to be quite grim for the next few years."

It wasn't hard to find European television executives who supported that view.

"The value is going down," said Guido Barbieri, who buys programs for Italian broadcaster Mediaset.

One growth market is Eastern Europe, which now generates more dollars than Latin America, according to Warner Bros.' Schlesinger. Russia, Poland and Romania are particularly hot right now, and deals are done in U.S. currency.

"And yes, we do collect our money from them," Schlesinger added.

But despite the downbeat forecasts, the studios were still rolling out the red carpet -- or at least serving up an international menu -- for buyers.

On Monday, the Warner Bros. lot in Burbank was bustling as caterers scrambled to serve a wide array of cuisine including lamb kebabs from a Glendale-based Armenian butcher. The studio even managed to arrange an appearance by the trendy Kogi Korean BBQ Truck, which has built a following on Twitter and attracts lines that can run more than 300 people deep.


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