Cartoon 2021 – Cartoon Business
Industry Report: Animation
Karen Vermeulen and Diego Ibañez Belaustegui profile animation buyers at Cartoon Business
The two speakers talked through how buyers’ habits have changed, their financial resources, the types of content they are looking for and the different types of deals they aim to seal
What type of animated series are buyers looking for? How much money do they have? What type of deals do they seal? These are just some of the questions that were tackled during one of the last panels ofCartoon Business (8-10 December), held this year in Las Palmas de Gran Canaria. The debate, entitled “Animated Series – What Do Buyers & Co-producers Want?” and moderated by Christophe Erbes, involved contributions from Karen Vermeulen, of Gaumont (UK, who attended virtually), and Diego Ibañez Belaustegui, of Planeta Junior (Spain).
During her presentation, Vermeulen talked through the different types of buyers, their levels of investment, their habits and content needs, as well as the usual types of deals they strike. Speaking about public service broadcasters (for example, ZDF, the BBC and France Télévisions), she explained that these buyers generally possess a stable, transparent budget and represent good value for money, but they also have limited slots. They normally commission content or seal co-production deals and provide marketing support. As these bodies promote “public values”, they look for culturally relevant content, local partners and stories, and have diversity and inclusion policies to comply with. They can cover part of the budget, but can also trigger applicable tax credits, grants and subsidies, funding up to 50%-70% of the costs.
Private networks and streamers (for example, Paramount+, HBO Max, Cartoon Network, Disney+ and Nickelodeon) obviously follow different patterns. Their strategies are typically pre-buys, co-productions and Original deals, as well as the very frequent (and much-debated) IP buy-out deals. These players can cover the budget totally or just in part. In terms of content, they look for groundbreaking, iconic IPs and hybrid animated shows (for instance, episodic ones with some serialisation), with a focus on pre-school and family-orientated pieces.
Meanwhile, equity-driven investors can encompass animation studios, co-producers, master licensors, advertising or licensing-and-management agencies, private investors, or even private individuals, and these usually cover 10%-50% of the whole budget. They look for a positive track record and the presence of a demonstrable audience segment (for example, via YouTube or pre-existing IPs) with a long-term commercial value, or editorial SVoD content with an additional margin for strategic upside. Their deals include co-production agreements (with cash or cash in consideration for services) and potential distribution advances, although the latter have reduced, owing to the shrinking second-window value. Their habits are difficult to pin down, as they are either business- or creative-driven, depending on the type of content they work on.
The last buyer’s profile presented by Vermeulen was that of second-window distributors, which usually seal revenue share and one-time licensing deals. They focus on volume, known IPs and track records when looking for new content. They follow a repeat business model and do not invest any money in the production budget.
In his contribution, Ibañez Belaustegui pointed out how the OTT world represents an opportunity with ample room for animated shows, as European animated TV content circulates significantly better than European TV content spanning all categories. Some recent OTT content trends highlighted by Ibañez Belaustegui include the focus on teen and tween content, whilst male- and female-focused content remains underserved. In terms of the stories, the top trending ones feature the themes of friendship and magic, and centre on a family, team or group as the lead characters, rather than an individual. For young boys, vehicle-based anthropomorphic characters are particularly successful at present, and overall, there is a push to create more gender-neutral content outside of pre-school across content for young kids, teens and tweens. Spin-offs, as things stand, still prove to be IP-efficient, and themes of adversity and adventure/mystery aimed at girls or with a female lead character may be an area that deserves further exploration.
Later, Ibañez Belaustegui had a closer look at the figures collected by Ampere Analysis over the last six months. The data show that Amazon seems to be targeting pre-school with a push for classical, recognisable IPs, and in particular for mystery-related content, whilst Netflix keeps on intercepting teens and tweens, pushing for mystery-themed pieces, but also for book-based series and anime.
In the last part of his presentation, he spoke about toy and game manufacturers as potential commercial partners (for example, Mattel, Bandai and Giochi Preziosi), which can also seal servicing or co-production deals. As potential buyers, these players tend to handle marketing initiatives to support sales, and may produce short-form content (to publish on YouTube, for example) and finance it in its entirety, while they may typically invest 50%-80% of the budget for broadcast-quality shows. They look for highly targeted content, aside from early pre-school and toddlers, including action, vehicle-driven, superheroes and humanoid characters for boys, and fashion, baby-nurturing, fairies and fantastical animals for girls. IPs recently benefiting from this type of partnerships include Gormiti, My Little Pony, Masters of the Universe and Transformers.
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