Epilogue to an April fool’s joke.

Isn’t it ironic how fiction parodies fact? When I sat down and penned the idea for the Australasian Union of Commercials’ Production Companies, it was in cahoots with Lynchy for the CB blog.

It was written purely as a joke, tongue firmly in the cheek. I thought: here’s a funny way of highlighting some the issues facing the production industry. I thought it might act as a reminder to one and all of the growing rift between agencies and tv production industry.

Work for production companies has been slowly drying up for the past four years, and since the recession there has been a dramatic decline. We have also seen a marked decline in margins and fees, while all associated costs have increased: advertising, crew, compliance, rent, insurance, fuel, etc. The work load has increased as production is being asked to do more and more work to get a project confirmed; the work that goes in to pitches is endless, not just from the time taken but from the resources required, treatments that look as good as the finished spot, multiple quotes every one with a million minuscule variations. And all this in a competitive environment, with sometimes five, six or seven directors pitching for the one spot and – even more exasperating – when the job is finally awarded, there’s more often a call from a frustrated agency producer that there’s a hiccup: ‘the client’s rethinking their strategy’, ‘its going to be delayed’ or a simple phone call saying the spot has been canned..

We are seeing older well established production houses close there doors – great companies that have brought so much to our industry: Sliverscreen, Aht, Independent, Sydney Film to name but a few – and while the demise or disappearance of these companies may be seen as a good thing by some (a change is as good as a rest), is it really a change for the best? Each of these great companies have provided a great service to the agency world: not only did they act in the agency and client’s best interest and produce highly successful campaigns over the past few decades, but they also provided a nursery environment on which young directors could cut their teeth and for producers, production managers to serve their apprenticeships and to truly learn their craft. This nursery environment was as healthy for the production industry as Axis/Award School has been in finding new creative talent for the agency world.

However, majority of production companies – like most agencies – are deeply set in their ways and consequently slow to change. Both have been cast from a mould set in the late fifties and they have been slow to adapt to a new world order (I twitter don’t you?). But whilst the agencies were pouring money into new ‘digital’ departments (yes that’s where they make those loverly website banners ads for their clients), production companies have been left reeling as mark-ups drop from twenty five to fifteen percent and then in most cases just ten percent – while still reeling from the down turn WPP announced the launch of its production company: Plush.

I advocated as much negative PR and press as I could around Plush’s launch. Noooo, I cried. But the writing was on the wall. WPP is a biggun, and Canute I am not, so I very quickly moved my throne into Plush’s Pyremont offices. And for all the negatives about Plush being the ‘ anti-Christ’ and caustic cries of ‘double-dipping’, WPP/SOM is a publicly listed company, it’s books open to public and client scrutiny. WPP is a progressive and forward thinking company: it looks at Plush as one of many ways to sustainable growth in the future. Has it worked? Has Plush changed things? As the credit crunch continues to bite, rest assured that number crunchers in other agencies are looking at the WPP model. McCann’s and one or two others are trying it, while yet other agencies are opting for what is referred to as the ‘preferred supplier' model, this the one where a small group of production companies get tied to an agency by getting guaranteed supply or volume of work, bidding against others in a tront system!

So what are we in the production industry going to do about the future? Do we in fact need to do anything? Do we carry on like a bunch of shopkeepers, all working in the same small marketplace, all selling the same thing, never talking to each other, just undercutting each other to stave of the inevitable? Don’t forget this is a business; this is what we do to pay the mortgage. The yanks have a great production association – AICP – and right now Matt Miller (the association’s president) is taking a stand on behalf of its members against Omnicom’s latest terms of trade (you get paid when we get paid. WHAT!!). In Australia we have SPAA… hello!!

In the early eighties, Jonty Barruad was producing for Geoff Dixon at Silverscreen. Jonty was starting to bid a lot of work for Geoff out of the US. The US agencies wanted the quotes on the AICP form. At the time, as now, we all had our own bid forms and our own way of doing things. Jonty contacted a bunch of us: ‘What about standardising the way we work?’ he asked, ‘What about the leading tvc companies getting together and sorting out some of the basics like the bid form, the terms and conditions for working with the agencies and crew?’ ‘Piss off,’ we said, ‘I’m all right Jack,’ was the call. We were high on the hog back then, unlike now when there are serious issues facing us. I know now that it was an opportunity lost. We were young and bullish and in refection naïve not to have acted back then. Jonty was onto it…

I guess the issue here is that television commercials are, and will be for a long time to come, the agencies’ and their clients’ highest profile format. (It doesn’t matter what the IT guys spin, television will be king till we all get ultra high speed fibre optic broadband, and this for most of us is a decade away. And then by crikey you’re going to see some changes!!) The TVC production industry supplies a vital production service to the agencies and right now those that work in this key industry are being asked to eat their young in order to survive…

I don’t know if this scribe is enough to set off a discussion, as we are known as an industry that responds well to any kind of forum or debate, however my inclination is that we are but moments away from needing to have one.

Look we don’t want to alienate the agencies, goddamit we love them, they are our lifeblood, but they are busting our balls. We know the problem: the clients hammer the agencies, the agency then gets the producers to hammer us (like they’ve always done, after all, we are renowned for our resilience..) but that resilience, that ability to bounce back is becoming harder and harder: mark-up is down or gone completely on some jobs, fees are nailed right down or the job is done for no fees some production companies are doing the work just for turn over. And this when most production company suppliers are rasing costs. Here’s a quote from the Sweet Shop global president Steve Dickstein as he comments on the Omnicom deal from last months Creativity Mag “The only thing I can say is that I have always considered it my job to provide smart solutions to our agency customers. Clever solutions are needed more now than ever before. And, in fact, the circumstances encourage innovation. Invention has always been the best part of the production company process."

Now I’m sure Steve’s comment echoes the way many off us think but when it comes to addressing the problems that face us the ‘we’ll be right’ sentiment can only take us so far. It’s going to get tougher; and there will be issues that we will need stand up for…

Always the keen fisherman I’ve started a blog: autcpc.blogspot.com it’s a kinda holding tank for your thoughts, well those of you wanting to vent your spleens, if so inclined….

April Fool’s day indeed..