"This is purely an investment play in content," said Rino Scanzoni, Group M's chief investment officer, who brokered the deal with ABC and Touchstone for Group M. Peter Tortorici, Group M Entertainment president and the former president of CBS Entertainment, is overseeing creative and production aspects.
Investing in content
"Content is driving the media marketplace," Mr. Scanzoni said. "Having our investments in it allows us to provide better opportunities to our clients." He declined to say how much money Group M Entertainment put toward the project, or whether it was the majority investor.
For ABC and Touchstone, working with Group M Entertainment allowed "us to find another source of funding for programming," said Mark Pedowitz, president, Touchstone Television and exec VP, ABC Entertainment Television Group. Good programming, of course, is always in demand, but it is particularly sought after today, as marketers, agencies and TV executives search for ways to captivate viewers who are migrating to other forms of entertainment.
Several media agencies, including Group M's MindShare, have partnered with clients to fund TV programming. Mr. Tortorici, for example, together with MindShare clients Sears, Roebuck & Co. and Unilever, teamed with ABC to create "The Days." But a media agency going with a studio and network alone is relatively rare. "It is a bold move," said Michael Kassan, CEO of Media Link.
Not about product integration
Product integration, another popular method used by marketers and agencies to get in front of consumers, is possible with "October Road" but not key to the deal. "We're not getting involved in this to force products into shows," Mr. Scanzoni said.
"It's a new model," Mr. Pedowitz said. "If you can bring the ad agency closer to a show's production, if they have a viable funding source and they can deal with their clients differently, it is good for the business."
"The beauty of this deal is relatively simple," said Mr. Scanzoni. "The network gets another series, another chance to hit a home run. We get inventory and a chance to participate [in the show's profit]. Most media agencies don't want to take the risk. We are prepared to take it."
The potential downside, of course, is failure. "It is an experiment," Mr. Pedowitz said.
"It's an interesting proposition," said Mr. Kassan, a consultant and former media-agency chief. "Advertisers have been funding programming forever. But not media agencies. Is this the business they should be in? It is a business of lemmings. If it works, everyone will follow."