This new article in Advertising Age magazine sheds some interesting light on where the Idol business is heading these days.
Take a look at the numbers:
Conservatively valued at $2.5 billion as a franchise, the American Idol empire already brings in $500 million a year in TV ad dollars, including a number of $30 million to $50 million core sponsorship packages, music sales, live tours — read: more sponsorship revenue as well as ticket sales — and an explosion of products from 40 licensees.
Expansion is the key word. According to Ad Age, chocolate bars, ice cream, a monopoly game, a theme park attraction and a “sims”-style virtual Idol world are some of the related merchandising deals Freemantle Media has either done or is in the process of negotiating.
And there is more. There are plans to stream the ENTIRE program at americanidol.com after it airs. McDonalds and Mastercard have signed on as sponsors. Cingular will make clips from the show available for download on cellphones after the program airs in Hawaii.
Keith Hindle, Fremantle Media Licensing Worldwide exec VP-integrated marketing and interactive-Americas, said the goal is to make “American Idol,” which hits the Fox airwaves Jan. 16, a year-round phenomenon.
What? It isn’t already a year round phenomenon? Heh.
According to Hindle, the goal is to capitalize on the viewer’s desire for interactivity. So, not only will viewers be able to vote for their favorites during the season, they’ll have an opportunity to appear in a music video with the contestants via a Ford contest and submit questions for the contestants through mycokerewards.com.
This is interesting:
Fremantle owns AmericanIdol.com, which is built, hosted and sold by Fox through a revenue-sharing agreement. Fremantle, approached by a major web portal last year about hosting the Idol website, came close to yanking the property from Fox entirely, said one executive close to the company, noting that the company felt that Fox hadn’t sufficiently capitalized on a web presence until season five.
The Fox-hosted site attracted 40 million unique visitors last season.
Fox and Freemantle have been slow to make video and audio downloads available for fans to purchase.
While Fremantle appears to be cleaning up — pretax revenue in the first half of ‘06 was up 75%, according to parent German media consortium RTL — it’s being careful to keep control of its golden goose. When executives last checked, YouTube was carrying some 32,000 “Idol” clips — all illegal.
And at this point, their biggest competition are the enterprising fans…
A question: If Idol saturates the market with products, could it be overkill? At what point does fatigue set in and folks start tuning out?
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Can’t believe the AI franchise made that much money, considering Katharine McPhee deliberately tried to bankrupt the corporation last summer by missing the first three weeks of the Idol tour.
Exactly. This has killed more than one program–overexposure. “Who Wants to Be a Millionaire” anyone???
And now they are going to put a spring edition of “Dancing with the Stars” out.
I think this-type-of-show fatigue is what may slow Idol, and other similar programs, down.
I say this, and watch Idol have the biggest season ever.
This is the type of fundamental change that, in hindsight, often becomes a jump-the-shark milestone.
This franchise had a credibility problem at the outset, made fun of in the media and ridiculed in the music industry. Being a winning contestant with an association to ‘AI’ was considered negative for your ongoing career, not a positive. That started to change, with some in the entertainment industry admitting that legitimate talent could come out of the ‘process’, etc. Advertisers realized that there was a broad and often well-to-do and educated audience that should be taken seriously.
This type of ‘expansion’ and supporting marketing, together with each year there being more contestants out there with recordings and the hints that more ‘ensemble’ product using top-tier contestants will be produced, could bring it full circle, to where anything associated with AI is not taken seriously. The contestant, especially the ‘winner,’ becomes superfluous. It won’t be something new and different that people are making fun of…and that’s when you hear the funeral knell.
I’m seeing many similarities here to changes over the past couple of seasons with Trump’s ‘The Apprentice.’
Ratings Slump
I thought that’s what they were doing when they started American Idol Rewind. What a huge disappointment that turned out to be! All they’ve shown so far is the crappy season 1 audition episodes (over and over). I know it’s on a different network, but I don’t understand why they didn’t show the entire 1st season in the fall when viewers didn’t have the current show to watch. Well, if Fox wants a “year-round phenomenon” maybe they should try a Fall show featuring contestants from previous seasons (kind of like IdolWaves).
Isn’t it already a year round phenomenon? Oh wait, that’s just for us!
I think it’s a bloody shame that the video files of AI on YouTube, et.al. are considered “illegal”. Under normal circumstances it is entirely legal to make a copy for personal use, and to share it with people. Under copyright laws it is only illegal to take someone else’s intellectual property and sell it for profit without permission. If AI pursues those who share episodes and clips with others on a supposed legal basis it would do more harm than good and would alienate a huge section of those who are responsible for that $2.5 billion in revenue. Big mistake threatening the fans.