With the flood of specialty channels, the coming of digital and the expansion of the Internet, small to mid-sized, Canadian television distribution companies have increasing opportunity to gain a foothold in an industry dominated by a small number of major players.

However, slim resources for buying, marketing and leveraging deals continue to limit the smaller guy from accessing the best product and wooing the commercial broadcasting outlets.

‘It’s difficult to sell a strong package of two or three movies when you have companies out there with 50 that broadcasters are forced to take based on output deals,’ says Charles Falzon, a 22-year veteran of distribution and ceo of Catalyst Entertainment.

Cross-ownership also creates often insurmountable stumbling blocks for the independent distributor.

Creating an alternative

On the bright side, some of these output deals are coming up for renewal and Falzon says ‘some of these broadcasters are finding it more challenging to compete in a diluted marketplace, so they’re looking for alternative suppliers to the majors, and different types of deals.’

The small guy also has access to product that the majors don’t, as the bigger companies tend to have a difficult time doing quality production that is also cost effective.

‘You can’t structure creativity without stifling it….There’s a lot of great talent in and outside of Canada that cannot live within the corporate reality of the majors,’ says Falzon, pointing out that companies like Catalyst provide independent producers with the care, attention and creative freedom to move forward with their original projects.

Catalyst has a broad-range library of 4,000 hours. Roughly 60% is in-house product, including programming from the Britt Allcroft Group, the Toronto-based distribco’s u.k. associate. Its strong points include family and children’s programming, movies, and lifestyle and infotainment product for the specialty services.

The principle behind its ‘department store’ approach is that the distribution business works in cycles, so it’s always important to carry product that fits most time slots.

‘If you specialize too much, you begin competing with yourself. I already find that if we take out six new kids shows, we can’t sell them all to the same broadcaster and it becomes tricky,’ says Falzon.

Diversification or

specialization?

At the last mipcom, for example, there was a surplus of preschool product, a situation that would have been disastrous for distributors who specialize in that genre. So from a basic economic point of view, it’s safer to have a diversified portfolio.

Also, with the multitude of narrowcast services, many of which pay relatively low licence fees, small to mid-sized distributors need to ‘generalize’ if they want a share of that market. If a distributor only carries primetime series or, say, nature documentaries, there are a lot of services that won’t bite. Falzon doesn’t want to miss out.

On the other hand, focusing on a specific genre of programming can be the equivalent of branding. ‘It helps you stay in the mind’s landscape a little more,’ says David Piperni, director of sales, Cambium Releasing.

In the last year, Cambium has been trying to get the word out to international buyers that it’s focusing heavily on lifestyle programming. ‘We feel there’s another year or two of life in the lifestyle genre.’

What’s key, however, for Piperni, is cultivating relationships with those buyers. Every year he takes trips to either Europe or Asia, outside of attending the tv markets. ‘It makes your job easier and gives you instant legitimacy when you send them a fax introducing your programming. They’ll actually look at it, instead of throwing it on the pile.’

As a relatively small player – Cambium has a library of roughly 400 hours – it has to look at innovative ways of marketing its programs. For example, the company produces a four-page newsletter that is inserted in the loot bags given to delegates at all the major markets.

Key markets for Cambium are Western Europe, Japan, China, Taiwan, Korea and Latin America, but new deals are on the horizon in central Europe because of the new cable and satellite channels springing up there, including wizja tv in Poland and hbo in Hungary.

Good things in

small packages

In spite of what Piperni cites as ‘buyers’ biases’ – the thinking that big is better – he says, ‘advantages come when you’re dealing with producers. They feel more comfortable with a smaller distributor because they’ll get more attention on the international market, which more often than not is true, and we use that as a selling point.’

On an even more optimistic note, he says, ‘broadcasters might feel that by going to the small guy they won’t be forced into buying stuff they don’t want to get the stuff they do.’

A quarter of Cambium’s programming is in-house and tends to get presold, but Piperni assures that depends on the ‘newness’ of the product. And in the end, of course, the product speaks for itself.

‘If you have a really good quality program, you can meet with anyone, no matter how small you are,’ affirms Marilyn Kynaston, director of international sales, Forefront Entertainment.

Until recently the Vancouver-based distrib/prodco, best known for its series Madison and The Adventures of Shirley Holmes (with Credo Entertainment), did not have the resources to offer distribution advances to producers. As a result, it has not been able to pick up long-running fictional series and has remained limited to buying magazine-style shows and docs, which are produced on significantly lower budgets and don’t require major distribution advances.

However, Forefront’s direction is likely to change since it picked up Vancouver-based Water Street Pictures’ series Edgemont Road, which it will roll out at natpe.

‘With Edgemont, we loved the scripts and the writers and director, so we came in early with an advance to help it happen. If we don’t come in early on these types of shows, someone else will, so you just can’t wait until the end,’ says Kynaston, who marks this acquisition as a milestone for Forefront.

Internet edge

The next step for the company is to develop its use of the Internet. ‘In the future, buyers from around the world will be able to download segments of our programs from the Internet, so that we don’t spend thousands of dollars each year couriering out. Once we’ve made a sale, the buyer can also download all the publicity materials, the script, photographs…so it will cut down on time, manpower and material costs,’ says Kynaston.

Forefront has roughly 340 hours of programming, focused mainly on children’s, teen and ‘tween dramatic series, as well as adult series, one-off docs and magazine shows.

After five years as director of tv sales for Alliance (he left just before the merger), William Alexander, president of Critical Mass, enjoys the benefits of being the small guy.

‘Because we’re independent we don’t have to worry about huge overhead and we don’t have to feed the machine with a set number of properties. We can actually pick and choose things we want to get involved with,’ he says.

As a young distributor – Critical Mass is about one year old – the company has taken a hybrid approach to buying and selling. No one deal is uniform. ‘Sometimes we acquire product with no money down, sometimes with money down, and sometimes we work all the gray areas in between. Being young enough, it’s easy to do that.’

By coming up with contracts on short notice, by promoting films with unique marketing ideas and by being highly accessible, smaller players are starting to disprove the preconception that the big companies are the only ones that can successfully take out a product, he points out. ‘We’re not a faceless corporation. We are here and on the front line everyday.’

Key markets for Critical Mass are the u.s., Germany, France, and soon, Australia and Japan.

Canada has also been strong for the young distribco, which already boasts a 740-hour library (700 hours for Canada, 40 hours international) of mainly movies, series and lifestyle docs, from companies such as Red Sky, The Film Works and Cadence.

Also, because of Alexander’s previous experience, he has built up domestic contacts, as well as relationships with independent u.s. companies that he uses on a consulting basis to meet with u.s. buyers.

Opening up an office in the u.s. is an eventual goal for the company. ‘It’s a vital way of building your base. You’ve got to know your territory and the only way you can do that is if you’re regularly meeting with the people and seeing them,’ says Alexander.

Selling Cancon

Even so, with the growing level of consolidation all over the world, many producers, who may appear independent, have their distribution tied up in another relationship, says David Seeler, vp development, acquisition and distribution for English Canada, Multimedia Group.

The demand for commensurate relationships is high, which means the ability for the smaller player to secure significant non-Canadian programming is limited.

The Multimedia Group is split between its Montreal office, where all international sales are made, and Toronto, which focuses exclusively on domestic sales. The Toronto catalogue is made up of more than 800 hours of mostly children’s programming and docs; and the Montreal library has another 800 hours, consisting of children’s/youth, doc and drama.

‘The nature of our catalogue means I deal mostly with educational broadcasters and specialties,’ says Seeler, adding, ‘I very seldom have a problem finding a home for the Canadian content in my catalogue. But for the non-Canadian stuff, the bar goes up, it has to be really good.’

More than half of Seeler’s catalogue is non-Canadian, but Canadian programming represents well over 50% of the company’s domestic sales.

Likewise, the company makes a lot of reformatting and versioning deals, in which it will put up some risk money to make any number of versions with the original producer and then distribute them all.

Looking to develop a production arm, Seeler says not having one ‘helped us for a while. We are not in conflict with independent producers, which makes it easier to represent them and make agreements.’

On the other hand, with a production arm, Multimedia could better control its stream of programming and garner more leveraging power, he adds.

Edmonton-based Great North International still has trouble competing with the big boys, even with a production division. The company’s in-house product makes up about 20% of its library.

As a smaller player, ‘we have a greater ability to adapt to an industry that’s constantly changing. We can take on product at the last second because being small means we can act fast,’ says Jim Fraser, manager of business affairs at Great North.

However, he adds, ‘we don’t have the resources to make big changes and that limits our access to the best product.’