Both Channels Plan to Air More Original Series to Refresh On-Air Branding for Twenty-Somethings and Their ParentsCable network IFC and its new sibling Sundance Channel are dividing the indie-film audience into two pools -- short-attention-span twenty-somethings and their art-house parents.
Three months after IFC owner Cablevision Systems Co. closed its $496 million deal to buy Sundance, the two networks are rolling out their coordinated strategy. With IFC aiming at young men and Sundance serving older "thought leaders," the company hopes the two similarly themed networks can expand their reach without stepping on the other's toes.
During an internal presentation last week, IFC and Sundance executives detailed a plan that calls for both channels to air more original series and refresh their on-air branding over the next few months. Even the movies they air will be increasingly distinct: Sundance will have more festival darlings and foreign-language fare, while pulp and "grindhouse" films aimed at younger audiences will likely end up on IFC.
As part of the plan, Sundance plans to announce "Man Shops Globe," a tentatively titled new series that follows the head buyer for Anthropologie as he travels on behalf of the upscale boutique chain. By contrast, IFC is teeing up a new pilot, "The Underworld with Dave Navarro," in which the Jane's Addiction guitarist explores odd subcultures, like bare-knuckle fighters and blood worshippers.
"Their personalities are completely different," Evan Shapiro, president of the IFC network and Sundance Channel, says of the networks' target audiences. "They both are 'independent,' but there's a difference between being edgy and being authentic."
The combined IFC-Sundance faces big challenges as it attempts to increase revenue and profit -- and justify Sundance's price tag. Both networks get more than 80% of their revenue from cable and satellite operators, according to SNL Kagan, but IFC is in about 50 million homes and Sundance is in only 31 million. Both networks sell sponsorships and custom-made branded series in lieu of traditional advertising, but that business is still nascent on Sundance, and SNL Kagan projects it will generate only $23 million for IFC this year.
"Integrating acquisitions is always a challenge," says Chris Marangi, an associate portfolio manager at Gamco Investors Inc., one of Cablevision's top shareholders.
But Mr. Marangi suggests that the bifurcated branding could make it easier to convince some cable operators to take Sundance when they already have IFC: "Differentiation ensures the value of each network does not get diluted."
The networks also plan to announce this week that they have merged their sponsorship and branded-entertainment staffs into a single group to court advertisers for both networks and increase revenue from other sources.
"They should be able to expand their advertising base by having broader offerings," says Ed Gentner, a national buyer for Publicis Groupe SA's MediaVest. But some big advertisers are still reluctant to plunk down money on nontraditional media without more third-party measurements, like those from Nielsen Co., to which IFC and Sundance don't subscribe, he says.
The moves to combine and simultaneously differentiate IFC and Sundance come as Cablevision has told investors it would be willing to put its Rainbow Media programming arm -- or parts of it -- up for sale. Last month, Cablevision CEO Jim Dolan said at a conference that Rainbow's "more developed channels tend to be more likely as sale candidates." AMC, for instance, is in 94 million homes, and is riding high on Emmy wins for its series "Mad Men."
But Mr. Dolan also said the company is focusing on boosting Sundance's advertising revenue, and broadening its distribution. Rainbow is also merging IFC's and Sundance's movie-acquisition departments and is launching a Sundance-branded pay-per-view movie service in addition to existing IFC-branded services.
Movies will still fill the large majority of the two networks' schedules, and Sundance will continue to offer extensive coverage of its titular film festival. But the new original series they're launching generally tackle topics apart from film.
In December, for instance, Sundance is launching a music and interview show hosted by genre-jumper Elvis Costello. And on Tuesday, IFC launched "The Automat," which consists of short "blasts" of anime, sketch comedy and musical performances from bands like the Shins woven into a single telecast.
By: Sam Schechner
Wall Street Journal; October 3, 2008
