The multi-billion dollar TV world is made up entirely of programs. In other words, every TV station, TV network, or cable TV out there lives on and is perpetually in need of programs.
Aside news gathering and news casting, TV networks are structured to source their shows from external parties. There lies the vast opportunity for people with creative minds and investment initiatives to participate in the TV world.
TV shows—one-time productions or series—come in different types. They could be “scripted” or “unscripted”. Scripted TV shows could be fictional (like comedy and drama) or non-fictional (like news and documentary). Over time, specific scripted entertainment has evolved in the form of…
- Animated shows
- Drama in the area of adventure, comedy, legal, medical, police procedure, political, science-fiction, fantasy, horror, supernatural, serial drama, soap opera and teen drama
- Television movies
Unscripted entertainment comes in the form of game shows, reality shows, talk shows (on fields like finance, health, fashion, real estate, tourism) and talent shows. TV shows have various angles. They could be instructional, educational, informational or entertaining.
Creation of TV Shows
Bringing TV shows to life involves many players—including the creator, producer, production company, TV network. Along the line, agents and attorneys could be involved. Of course, actors and crews will also participate. While the roles of the creator, producer and production company are distinct and can be separated, they could be rolled into one personality.
Every TV show starts as an idea from a creator. The idea is developed into a concept. The concept grows into a script consisting of characters and crew, done by the creator of the idea or by a producer or production company. The story is pitched to a TV network and then another if one network declines the show. A network that is interested requests a pilot—which is the first episode. Request for a pilot flags off production.
When a pilot is accepted, full production of the series follows. The show is then turned over to the accepting television network which broadcasts the show according to a schedule. If the show has good ratings and viewer acceptance, the show continues for as long as possible. Otherwise, the show is cancelled. That could mean the end of the show if the remaining episodes are not accepted by other networks. A highly successful show can go into syndication through which broadcast rights can be resold. It can also yield DVD sales.
How to Make Money Buying and Selling TV Shows
The person engaged in buying and selling of TV Shows is a producer. Buying and selling TV shows involves scouting for creators and screening their concepts and/or scripts. The producer buys either a concept or a full script from a creator, pitches the concepts and scripts to TV networks and produces the show.
Once the producer is interested in the concept or script, the creator receives a little “option payment” pending the acceptance of the show for broadcast. When the show is to be broadcast, the creator receives either a one-time payment or an on-going payment arrangement which continues as the show gets serialized.
For a show to succeed commercially, it must appeal to and be valuable to the active population of ages 18-49 because this is the target group for most advertisers. Revenue for the show will invariably come through advertisements, which will be earned by the TV networks from the popularity of the show.
It is critical for a producer to be able to identify what constitutes a good and valuable idea, concept or script and to decide which idea is suitable for which TV network. Only such valuable and suitable concepts will survive, earn revenue for a long while and make profit or fortunes.
How to Finance and Make Money from TV Shows
Major cost elements for TV shows are payment of creators, production and airtime. A producer with the required financial muscle can bankroll the project. In this case, the producer recovers costs and makes profits from proceeds of licensing to TV networks, advertisements, sponsorships and sale of DVDs. However, there are many options that can ease the financial burden of the producer.
Instead of bankrolling the project, the producer can secure sponsorship from public agencies or commercial organizations depending on the nature of the show. A public enlightenment show can attract sponsorship by public agencies while shows that complement some commercial activity may attract sponsorship by relevant commercial organizations.
With deficit financing, a producer can get a studio to finance the production of a show and take care of negotiated payments for the producer and creator. The broadcasting network pays a license fee to the studio or enters into a revenue sharing arrangement with the studio. The studio eventually recovers its costs and makes profit through licence fees or revenue shares from as many networks as possible that may opt to air the show. The studio can further earn through syndication, DVD and Blue-ray disc sales. The TV networks, of course, recover their costs through adverts plus subscriptions for cable networks.
Feasibility of TV shows
A look at prevailing advert rates reveal that revenue from adverts can adequately pay TV show production costs and return considerable profit.
Apart from adverts, a producer has a lot of avenues for recovering costs and making profit. There are the licensing, sponsorship, revenue sharing and profit sharing options. Opportunity to sell DVDs is also available.
Different partners for a TV show can contribute services and resources to finance the show so that the producer carries very little financial burden. Choice of shows to promote is as wide as there are human interests.
There is a widespread presence of TV networks and Cable TV jostling for relevance and viewer retention through presentation of acceptable shows. Advertisers and sponsors are willing to spend on promising TV shows. A venture into the buying and selling of carefully selected television shows is bound to be profitable.
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