The Wall Street Journal
Snapchat doles out creative notes to old media giants on making quick, original shows on a vertical screen for young viewersSnap Inc.’s SNAP +1.36% ambitious effort to create television-like content has old and new media companies alike clamoring to learn how to produce shows for Snapchat’s lucrative young audience. Over the past several months, Snap has signed original show deals with NBCUniversal, Turner, A+E Networks, Discovery, BBC, ABC, ESPN, Vice Media, Vertical Networks, the NFL and Metro-Goldwyn-Mayer Inc. It is also in discussions with CBS and Fox, according to people familiar with the matter. On Thursday, Snap plans to unveil another show deal with Food Network-owner Scripps Networks Interactive , SNI +1.82% which will produce offshoots of existing TV hits like “House Hunters” and “Chopped.” Snapchat hopes to have two to three new episodes of original shows airing each day by the end of the year in the “Stories” section of the app, which displays collections of snaps from friends, as well as stories from media outlets. The shows will be three to five minutes long. Snap is plunging headlong into developing original shows—which are presented vertically like the rest of its app—to keep its 158 million users engaged and boost revenue growth in its nascent life as a public company. Ad revenue growth, which could come from its original show efforts, is key to supporting its valuation of more than $25 billion. And shows could encourage its users—who already spend 25 to 30 minutes a day on the app—to stick around even longer. To that end, Snap hasn’t been shy about doling out extensive and detailed notes to its TV partners—much like what TV network executives themselves give writers and showrunners. Snap executives weren’t thrilled with some of NBCUniversal’s initial ideas last summer for Snapchat shows based on existing television shows because they sounded like promotional clips typically found online. “They were very much in a TV mind-set,” said Snap’s vice president of content, Nick Bell. “We wanted something as premium as television itself.” Instead, Snap and NBCUniversal created a version of “The Voice” singing competition on the app, where users could submit 10-second audition clips. More than 20,000 submissions came in and the winner made an appearance on the live TV show. Snap even sent its staff on set to advise on faster pacing and framing the vertical camera shots closer to faces. “Naturally, healthy friction happens, but it’s very collaborative” said NBC Entertainment’s executive vice president of digital, Robert Hayes. “We’re really open to hearing their point of view.” Snap’s 26-year-old CEO, Evan Spiegel, is closely involved in thinking through how best to present shows on the app, according to Mr. Bell. Beyond reality fare, the company is looking for scripted dramas, daily news shows, horror, documentaries, animated shows and more. To make room for scripted shows, Snap says it may tweak the app to allow for binging and catching up (the few shows it has aired so far have disappeared within 48 hours). While media companies have had various disagreements with YouTube and Facebook , TV companies are flocking to create original shows for Snapchat. That is in part because Snap executives including Mr. Bell, a former News Corp. executive, embrace certain old media values like scarcity and promoting a select group of premium content above user-generated fare. Mr. Bell says he wants to help grow TV audiences by exposing Snapchat’s young user base to their brands. “I don’t want to be a TV killer,” Mr. Bell says. Unlike streaming services like Netflix , Snap shares detailed data on performance with its show partners—everything down to when people “tap out” of a particular episode. Snap executives have advised A+E on everything from talent selection to granular details, said Paul Greenberg, executive vice president of A+E’s digital content arm. “We both look at the data for each scene: When does the audience fall off and why? Is there a quicker cut we can make?” Mr. Greenberg said. Snapchat is only offering show creators an ad-revenue share, rather than paying upfront for content. Media executives say the approach works for now because the deals are short term and “all of us are still enamored with their audience,” said Henry Ahn, Scripps’ president of content distribution. Plus, Snapchat shows are much cheaper to produce than network television. A Snapchat episode can cost anywhere from $6,000 to upward of $45,000 with marquee talent and higher production value, media executives say. “When you start cutting checks in the early days,” you get sucked into a cycle, says Mr. Bell. He said Snap wants to build an ad-based business model that will make shows lucrative profit-generators for creators within three to five years. Shows can also become profitable nearer term, he said: some of Snap’s early shows already make money. On “Discover,” Snapchat’s publisher platform, the company offered at least some partners 70% of the ad revenue if they sell the ads and a 50-50 split if Snapchat does. People familiar with the show deals said the company is offering only a 50-50 ad split for original shows. A Snap spokeswoman declined to comment on the ad-revenue split. Barry Poznick, MGM’s president of unscripted television who is developing comedies for the app, said Snap executives are far from “kids in cubicles” offering notes and instead make suggestions with more authority than some TV executives because of their data. “We thought we were going to teach them how to make TV, and instead, they are teaching us,” he said.
—Georgia Wells and Suzanne Vranica contributed to this article.Write to Shalini Ramachandran at email@example.com