Confidential Draft Game Show/Reality Format Business November 2007.
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Transcript of Confidential Draft Game Show/Reality Format Business November 2007.
Confidential Draft
Game Show/Reality Format Business
November 2007
2
Overall Approach
• Build a “Base Case”
– Include:
Embassy Row existing shows
Embassy Row existing staff (ALL overhead costs)
Assumptions for new SPE U.S. shows (creating a “new” case for number of shows to develop;
effectively adjusting aggressive Embassy Row assumptions downward)
Keep Embassy Row assumed 10% EP fee and 10% chargeback
Includes $2MM in a domestic development/acquisition fund (for scripts, advances, sourcing
other ideas, etc.)
– Assume:
U.S. based development with show formats sold internationally
New headcount (~5 people) to acquire and sell international formats
Development team (~3 people) based in the U.S.
• Add an “Acquisition Case” on top of the “Base Case”
– Include:
Significant acquisitions in years 3, 4 and 5 to build local production capabilities in Latin
America, U.K. and others (TBD)
3
SPE Slate/Project Tracker
2007 EPS 2008 EPS 2009 EPS 2010 EPS 2011 EPS 2012 EPS 2013 EPS
WSOPC 2 (CS1) 8 WSOPC 3 (CS1) 10 WSOPC 4 (CS1) 12 WSOPC 5 (CS1) 12Grand Slam (CS2) 8 Grand Slam 2 (CS2) 8 Grand Slam 3 (CS2) 10 Grand Slam 4 (CS2) 10 Grand Slam 5 (CS2) 12Chain Reaction 2 (CSS1) 65 Chain Reaction 4 (CSS1) 65 Chain Reaction 5 (CSS1) 65Chain Reaction 3 (CSS1) 65P10 (NS1) 8 P10 (NS1) 16 P10 (NS1) 16 P10 (NS1) 22 P10 (NS1) 26
WSOPC (FMT1) 40 WSOPC (FMT1) 40 WSOPC (FMT1) 40 WSOPC (FMT1) 40Grand Slam (FMT2) 40 Grand Slam (FMT2) 40 Grand Slam (FMT2) 40 Grand Slam (FMT2) 40 Grand Slam (FMT2) 40Chain Reaction (FMT3) 40 Chain Reaction (FMT3) 40 Chain Reaction (FMT3) 40P10 (FMT4) 40 P10 (FMT4) 40 P10 (FMT4) 40 P10 (FMT4) 40 P10 (FMT4) 40P10 (SYN1) 195 P10 (SYN1) 195 P10 (SYN1) 195 P10 (SYN1) 195 P10 (SYN1) 195
Net Series 1 (NS1) 40Cable Series 1 (CS1) 10Acquired Series 1 (AS1) 40
Cable Series 4 (CS4) 10 Cable Series 4 (CS4) 10 Cable Series 4 (CS4) 10Acquired Series 2 (AS2) 40 Acquired Series 2 (AS2) 40 Acquired Series 2 (AS2) 40
Cable Series 4 (FMT5) 40 Cable Series 4 (FMT5) 40Acquired Series 2 (FMT6) 40 Acquired Series 2 (FMT6) 40
Net Series 3 (NS3) 40 Net Series 3 (NS3) 40Cable Series 7 (CS7) 10 Net Series 3 (FMT7) 40Acquired Series 3 (AS3) 40
Cable Series 10 (CS10) 10Acquired Series 4 (AS4) 40
Net Pilot 1 (NP1) 1 Net Pilot 2 (NP2) 1 Net Pilot 3 (NP3) 1 Net Pilot 4 (NP4) 1 Net Pilot 5 (NP5) 1Cable Pilot 1 (CP1) 1 Cable Pilot 4 (CP4) 1 Cable Pilot 7 (CP7) 1 Cable Pilot 10 (CP10) 1 Cable Pilot 13 (CP13) 1Cable Pilot 2 (CP2) 1 Cable Pilot 5 (CP5) 1 Cable Pilot 8 (CP8) 1 Cable Pilot 11 (CP11) 1 Cable Pilot 14 (CP14) 1Cable Pilot 3 (CP3) 1 Cable Pilot 6 (CP6) 1 Cable Pilot 9 (CP9) 1 Cable Pilot 12 (CP12) 1 Cable Pilot 15 (CP15) 1Acquired Product 1 (AP1) 1 Acquired Product 2 (AP2) 1 Acquired Product 3 (AP3) 1 Acquired Product 4 (AP4) 1 Acquired Product 5 (AP5) 1
4
SPE Slate Assumptions
New Shows -- Developed ProductNetwork
– 1 pilot generated every year– 1 pilot is picked-up every other year– 1 becomes a success every other year– Produce 26 eps on network per year– The successful "big show" airs on network for 2 years before going into 1/2 hour First-run syndication – License format internationally of successful shows– "Looks like Power of 10 Network"
First-run Syndicated Show– Begins after 2nd season of successful network show and runs for the remaining life of show + 2 years– Produce 195 eps (39 weeks, 5 eps/week) of first-run show)– "Looks like Crosswords Syndicated Strip"
Cable Show (Ex. Reality Show format)– 3 pilots generated every year– 1 pilot is picked-up every year– 1 becomes a success every other year– Produce ~10 eps per season– License format internationally of successful shows– "Looks like a show on GSN/WSOPC"
New Shows -- Acquired Product– Acquired Product– 1 generated every year– 1 becomes a success every other year– Produce ~40 eps per season– License format internationally of successful shows– 40% Revenue Share
Format Licensing– Sell formats of successful shows starting during Season 2 for the remaining life of show + 2 years– ~40 Episodes per format
Additional Items to Include– Need to add mobile, internet and other ancillaries
5
SPE Profit & Loss Roll-up
Actual Forecast SPE AssumptionsCY2007 CY2008 CY2009 CY2010 CY2011 CY2012 CY2013
RevenueEmbassy Row Product in Development
Budget 17,156$ 21,366$ 21,757$ 23,836$ 24,016$ -$ -$ EP Fee 1,882 2,182 2,224 2,281 2,350 - - Charge Backs 987 1,158 1,182 1,256 1,194 - - Other - - 31,750 33,700 37,600 42,825 44,150
Sub-Total 20,024$ 24,706$ 56,913$ 61,073$ 65,160$ 42,825$ 44,150$ Newly Developed Product
Network - - - 22,526 - 22,526 25,312 Cable - - - 2,924 2,924 7,602 7,764
Acquired Product - - - 11,696 11,696 25,608 26,256 Sub-Total -$ -$ -$ 37,147$ 14,621$ 55,737$ 59,333$
Total Revenue 20,024$ 24,706$ 56,913$ 98,220$ 79,780$ 98,562$ 103,483$
CostsEmbassy Row
ER Production Costs 14,287$ 18,026$ 42,726$ 45,893$ 47,346$ 28,217$ 29,628$ ER Overhead Expenses 2,308 3,031 3,155 3,551 3,799 3,989 3,989
Sub-Total 16,595$ 21,057$ 45,881$ 49,444$ 51,145$ 32,206$ 33,617$ Developed Product
Network - - 750 19,522 750 19,522 20,510 Cable - - 975 3,412 3,412 5,977 6,112
Acquired ProductCosts - - 160 9,907 9,907 20,167 20,707 Revenue Share - - 0 716 716 2,177 2,220
Sub-Total -$ -$ 1,885$ 33,557$ 14,785$ 47,842$ 49,549$ Format Business
Development/Acq. Budget - - 2,000 2,000 2,000 2,000 2,000 Headcount - - 1,438 1,509 1,585 1,664 1,747
Development - - 3 3 3 3 3 Sales - - 3 3 3 3 3 Acquisition - - 2 2 2 2 2
G&A - - 359 377 396 416 437 Sub-Total -$ -$ 3,797$ 3,887$ 3,981$ 4,080$ 4,184$
Total Costs 16,595$ 21,057$ 51,563$ 86,887$ 69,910$ 84,128$ 87,349$
Net Profit (Loss) 3,429$ 3,649$ 5,350$ 11,332$ 9,870$ 14,434$ 16,133$
6
SPE Model Assumptions
SPE AssumptionsSource ER Pof10 ER SPE($ in 000) Broadcast First-Run Cable AcquiredCost per Pilot $750 $450 $325Fee per ep, for acquisitions $4Episodes 26 195 10 40
Lic / ep Yr 1 $722 $65 $244 $244Lic / ep Yr 2 $760 $75 $257 $257Lic / ep Yr 3 $800 $95 $270 $270Lic / ep Yr 4 $840 $130 $284 $284Lic / ep Yr 5 $882 $145 $298 $298
Ads / ep Yr 1 $0 $65 $0 $0Ads / ep Yr 2 $0 $65 $0 $0Ads / ep Yr 3 $0 $65 $0 $0Ads / ep Yr 4 $0 $65 $0 $0Ads / ep Yr 5 $0 $65 $0 $0
EP and Chargeback Fee / ep Yr 1 $144 $25 $49 $49EP and Chargeback Fee / ep Yr 2 $152 $26 $51 $51EP and Chargeback Fee / ep Yr 3 $160 $28 $54 $54EP and Chargeback Fee / ep Yr 4 $168 $29 $57 $57EP and Chargeback Fee / ep Yr 5 $176 $30 $60 $60
All Prod Costs / ep Yr 1 $722 $125 $244 $244All Prod Costs / ep Yr 2 $760 $131 $257 $257All Prod Costs / ep Yr 3 $800 $138 $270 $270All Prod Costs / ep Yr 4 $840 $145 $284 $284All Prod Costs / ep Yr 5 $882 $152 $298 $298
OtherFormat Eps 40Formats Sold 10Fee Per Ep/Territory $4
G&A Expenses as a % of Headcount 25%Acquisition Budget $2,000Acquisition Revenue Share 40%Growth in ER Overhead Expense 5%EP and Chargeback Fee 20%
7
Next Steps
• Confirm key assumptions for “Base Case”
– # of shows and success rate
– # of shows licensed internationally
– # of acquired product
– International format/license fees/acquisition costs
– Our assumptions relative to Michael Davies’
• Confirm “Acquisition Case” assumptions
– Current valuations of int’l production companies
– Capacity
– Staff
• Consider market data for number of new and renewed game/reality shows domestically and
internationally
8
Appendix
9
Embassy Road Slate/Project Tracker
Game Show / Reality Format StrategyEmbassy Row Entertainment Slate/Project Tracker
2007 EPS 2008 EPS 2009 EPS 2010 EPS 2011 EPS
WSOPC 2 (CS1) 8 WSOPC 3 (CS1) 10 WSOPC 4 (CS1) 12 WSOPC 5 (CS1) 12Grand Slam (CS2) 8 Grand Slam 2 (CS2) 8 Grand Slam 3 (CS2) 10 Grand Slam 4 (CS2) 10 Grand Slam 5 (CS2) 12Chain Reaction 2 (CSS1) 65 Chain Reaction 4 (CSS1) 65 Chain Reaction 5 (CSS1) 65Chain Reaction 3 (CSS1) 65P10 (NS1) 8 P10 (NS1) 16 P10 (NS1) 16 P10 (NS1) 22 P10 (NS1) 26
Net Series 2 (NS2) 8Cable Series 3- GSN (CS3) 13
Cable Series 4 (CS4) 8 Cable Series 4 (CS4) 10 Cable Series 4 (CS4) 12
Net Series 3 (NS3) 8
Cable Strip Series 2 (CSS2) 65
Syn Series 1 130
Net Series 5 (NS5) 8Net Series 6 (NS6) 8Cable Series 6 (CS6) 8 Cable Series 6 (CS6) 10Cable Strip Series 3 (CSS3) 65 Cable Strip Series 3 (CSS3) 130
Cable Series 7 (CS7) 8
Net Series 7 (NS7) 8Cable Strip Series 4 (CSS4) 40
P10 Pilot (NP1) 1 Net Pilot 3 (NP3) 1 Net Pilot 5 (NP5) 1 Net Pilot 7 (NP7) 1 Net Pilot 9 (NP9) 1Balls of Steel (CP1) 1 Net Pilot 4 (NP4) 1 Net Pilot 6 (NP6) 1 Net Pilot 8 (NP8) 1 Net Pilot 10 (NP10) 1Net Pilot 2 (NP2) 1 Cable Pilot 3 (CP3) 1 Cable Pilot 5 (CP5) 1 Cable Pilot 7 (CP7) 1 Cable Pilot 10 (CP10) 1Cable Pilot 2 (CP2) 1 Cable Pilot 4 (CP4) 1 Cable Pilot 6 (CP6) 1 Cable Pilot 8 (CP8) 1 Cable Pilot 11 (CP11) 1
Cable Strip Pilot 2 (CSP 2) 1 Cable Strip Pilot (CSP2) 1 Cable Pilot 9 (CP9) 1 Cable Pilot 12 (CP12) 1SynPilot 1 1 SynPilot2 1 Cable Strip Pilot 3 (CSP3) 1 Cable Strip Pilot 5 (CSP5) 1
Cable Strip Pilot 4 (CSP4) 1 Cable Strip Pilot 6 (CSP6) 1SynPilot 3 1 SynPilot 4 1