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South Park Digital Deal Raises Many Questions August 27, 2007

Posted by David Card in Media.
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They like the promise “50-50” now, but didn’t they like big up-front checks better? (Oh, wait, there is an up-front payment.) What if there’s not that much digital video advertising (or syndication revenues, or consumer spending), or, more likely, LOTS of competition for a medium-sized pie? And what about the always notorious “Hollywood accounting?” Is it 50-50 after costs?

If this is indeed a trend, it might be a good thing for everybody, as programming development risks could be spread more evenly. (That’s one of the problems with music industry economics.) That is, as long as those up-front payments aren’t absurd. Perhaps this is a lesson on how to end-run Viacom-YouTube shenanigans. If so, it’s yet another example of more power to the artists and agents, and less to the studios/networks. Oh, so many variables. As usual, nobody knows anything.

The NY Times breaks the story on a digital deal for the South Park creators:

    Now, however, Mr. Stone and Mr. Parker and their bosses at Comedy Central, a unit of Viacom’s MTV Networks, are attempting to leapfrog to the vanguard of Hollywood’s transition into Web. In a joint venture that involves millions in up-front cash and a 50-50 split of ad revenues, the network and the two creative partners have agreed to create a hub to spread “South Park”-related material across the Net, mobile platforms, and video games.

And maybe it can’t be a trend, at least not for anybody with existing contracts:

    But even Mr. Parker and Mr. Stone would most likely not have been able to negotiate their new joint venture had they not years ago inserted into their contract what has proved to be a killer deal point. Comedy Central’s boilerplate reserved to the network any income generated by the show through other network divisions. But the pair’s lawyer, Kevin Morris, insisted that any “South Park” revenue not derived specifically from broadcast on the cable channel would go into the pot for calculating the men’s share of back-end profits.
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