Business Musings: Lockdown Licensing Partnerships

Somewhere around the middle of March, I got an email from one of the television producers I’ve worked with for three years now. He asked for an extension of our agreement, which expires in June.

A little background. As of January 1, we had a script. We had interested parties. He was going to start filming the pilot sometime in the summer. Whether or not we needed a pilot on spec depended on two extremely interested studios, both of whom needed content desparately, both of whom loved the project.

The producer had just dictated rewrites to the script, which is lovely—except that he removed a major female character and made her male. (Sigh) He had initially brushed off my comments about changing her gender, even though I kept telling him she was one of the most popular characters I’d ever written. Then one of the studio heads mentioned that they wanted more female-centric material—and viola! The gender switch needed to be reversed.

That was the last pre-COVID-19 conversation we’d had. He was going to send the new script in March, we were going to see what the studios wanted, and whether we would get a full season order or just a pilot order.

Then the world fell apart, and surprisingly, the film/TV industry completely cratered. For those of you who haven’t been following this, production had to shut down on almost all TV shows and movies, because it takes a lot of people to put a show together. Those that did get finished were usually in post-production, and usually could be finished by a single editor, alone somewhere with the right equipment.

If you want to see the scale of the problem, this article by Vox shows some of the changes (although not all). They’ve been trying to keep it current, even though it’s missing a ton of information.

Deadline is also running a series called “Reopening Hollywood” which is looking at everything from insurance to casting and more. Here’s the latest there.

I can’t quite convey to you the depth of fear and panic and sheer “we have no idea what to do next” that I’m getting from my film and TV partners.

The producer I mentioned above was the first to contact me, as everything was beginning to go south. We had a long back-and-forth about the future of the project, and I slowly began to realize that he was deeply, deeply, deeply panicked.

He listed a variety of options that we had to do something by the fall (remember, this conversation occurred in March), including an animated pilot. He asked if I would be amenable to that.

I was, more or less, but I told him we’d have to negotiate a new agreement to accommodate animation. I know enough about animation to know that the agreement we had wouldn’t cover some of the things he needed and wouldn’t protect me properly in the animation world.

He also asked for video game rights, and I said no, since a gaming company held options on those rights. He was so panicked, he wanted to maybe talk to the company. And I said, you’d be in a negotiation with them, and they’re sharks. Let’s wait and see what happens first, and what you need to get things done.

What he needed—and what we settled on, in March—was an extension of our agreement, which went until July 1. The way everything was moving at the beginning of the year, we figured we’d be doing a detailed extension with studio involvement and lots of lawyers.

Ha! We had no idea that we’d all be sitting on our hands right now, waiting to see what comes next.

After talking to him, I looked at all of my agreements with the film and TV industry. (I’d already looked over my gaming agreements, because of a large deal that came through just as this all started to close down.) Most of my agreements and options would continue through 2021, and needed nothing from me. At some point, I will contact those producers once we know what’s happening in the industry.

Until then, there’s no need to start discussions.

But I knew I needed to contact one producer I’d been working with off and on for decades. We had done a variety of projects together, although none of them ever got filmed.

This producer has put a lot of money into our current project and has gotten a lot of traction—or had, as of February. It looked like a new studio startup was about to fund our TV show, and if they weren’t interested, one of the big streaming services had circled back around after initially saying no and expressed a strong interest.

We had an agreement through July 1, and we both figured (like the other producer) that we’d be doing a new partnership agreement with one of these companies, or we would renegotiate with each other, as we had done in the past.

What I hadn’t done in the past was approach her about a new deadline. She always approached me.

The problem with new deadlines for producers is that they have to pay something for the privilege of working with my property for additional time. The properties I have in development and under option (with the exception of one) always have interest, and I leverage that interest so that it benefits me.

What do I want? A good producing partner. Someone who sees me as an equal. Someone I can work with. Someone who will license only the rights that they need, not try to own the entire copyright.

And oh, yeah. Money is good. But it’s not the be-all and end-all. I care more about what we’re licensing and where my name and book title go on the credits than I do about buckets and buckets of cash. (When something gets produced, I would make more money just in book sales on that five-second ad created by my name on the credits before every show than I would on up-front money, ever. And no, I’m not explaining all of this in detail. If you want the lecture, come to the Business Master Class in 2021.)

This time, though, I contacted the producer, mentioned that our agreement was ending in June, and that I was willing to pretend that first 6 months of the year did not exist. Let’s extend to the end of the year, I said.

Why would I do that?

Because I’m this producer’s partner in this project. They need me, and I need them. We’re creating something new here—a TV show—and while it’s based on my work, it won’t be my work entirely. No TV show is entirely the work of one person.

In this crisis, it was time for me to step up—and not try to gouge this producer, but to show that I’m a partner in this mess as well.

The response was relief and gratitude and an addendum, extending our current agreement to December 31, 2020. Let’s hope that’s what we need. Although we’re aware that no one knows.

Because it’s more of a mess than anyone outside of the industry knows.

As one of my producing partners noted in an email, things have ground to a complete halt in the industry—except for the sale of finished films to streaming services. They said, “We’re collectively trying to figure out how production can/will resume, and what it will look like. With the strength of the unions in entertainment it’s a big undertaking to figure out new safety and shooting protocols.” (See those Deadline articles.)

To make things even stranger, agents and managers are losing their jobs all over the entertainment industry. Some of the problems with agents and managers existed before the pandemic, and only got exacerbated as this goes on. But even the venerable William Morris Agency, which is now WME, laid off 20% of its workforce.

And they’re not the only ones. As one of my producing partners said in yet a different email, “Agencies representing actors/writers/directors seem hardest hit, with a lot of agents I know being laid off or furloughed.”

I’m seeing that news everywhere, and I fully expect the same thing in the book industry, which was why I wrote this post.

The point of today’s blog post though is something else entirely. For the past year, I’ve been discussing licensing on this site, and those posts have turned into a book called Rethinking The Writing Business (which you can currently get in a Storybundle along with several other ebooks and a $50 lecture for about $15.)

If you’re going to license your work, you need to be a tough negotiator, as I’ve said many times before. But you also need to be a good partner. You need to know when someone is blowing smoke, and when they’re having issues. You also need to know if those issues will have an impact on you.

Right now, the entire film/TV industry is in a huge flux. The only doors I’ve closed with my producing partners right now are doors that lead to someone else (to stretch the metaphor). I couldn’t license gaming rights to the first producer because that would take a huge negotiation, and I wasn’t willing to do it. The gaming company knows how to do video games; that producer was looking at them as an escape from the problems he currently has, and has zero expertise in the industry.

But animation? Sure, let’s look at it. Because it’s viable even if the virus sticks around for two more years. But we need a new agreement to cover that because animation is a different animal.

Extending the agreements with people who want to make no changes is just sensible right now. And doing so in a way that reflects the situation at hand. Because no one asked to be in this predicament, and no one knows how/when it will end. We don’t know what our industries will look like.

Traditional publishing has some bright spots (juvenile print books) but the adult divisions are just starting to deal with the pain. (I’ll cover some of that in a future post. Just got dismal news on Sunday about a favorite annual project. It’s not mine to announce, so I won’t.)

When you end up partnering with people in licensing, they are not the enemy and they are not your friend. They are people you work with. You share a vision, and you want to create a new product. That new product might not be viable in the post-virus world, but it might be, with some changes.

It’s up to you to be a good partner, to do what you can within your limits to keep your partners happy.

Come 2021, I fully expect some of my deals to fall apart instead of being renewed. The world will be different then, and the old deals might not apply. But some of my partners are flexible enough to survive in the new world, and those folks are the ones I want to stick with.

We’re all traveling these new roads together, and we don’t know what’s ahead. We’ll figure it out, but it’s better to adopt a wait-and-see attitude right now than it is to plunge headlong into something that we might regret. Or to cancel something that might be a good idea a year from now.

Just putting this out there as part of the licensing learning and something—obviously!—I hadn’t thought of when I put the entire book together just a few months ago.

To show you just how quickly things change, I wrote this on Sunday. On Monday came the news that parts of the European film and TV industry are starting back up, and even more news that a low budget film in Hollywood is going to try to start up at a studio.

This is why, as a licensing partner, you need to remain flexible. The second story would never have happened pre-COVID-19.

I’ll be doing more licensing related blogs, particularly since the Licensing Expo was supposed to be this week, in the next few weeks, as well as cover some other important topics.

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“Business Musings: Lockdown Licensing Partnerships,” copyright © 2020 by Kristine Kathryn Rusch. Image at the top of the blog copyright © Can Stock Photo / macrovector.