Made for Digital: Believe Entertainment Group Is Bypassing Television

A new breed of media companies are trying to convince people to get their sitcom and drama fix directly from online original programming instead of television.

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Didn’t get your fill of LeBron James during the NBA playoffs? You can always tune in to “The LeBrons,” an animated series that debuted on YouTube last year.

Like techno? “In the Booth” gives back-stage snippets of legendary Dutch DJ Tiësto during a recent North American tour, which included the first ever live stream concert on Twitter.

Meanwhile, this fall teens can tune in to “Tiger Beat Entertainment” for five-minute segments covering fashion, health and music, with regular appearances from co-producer Jennifer Lopez. The program is slated to debut in early fall on AOL’s Cambio.

While decidedly different, all three shows are attached to big names in entertainment and connected with deep-pocketed “brand sponsors.” And none are made for television.

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The masterminds behind this digital lineup are Dan Goodman and William H. Masterson, who founded Believe Entertainment Group in 2010. Their goal:  Bypass cable and the major networks altogether and bring Hollywood-quality entertainment directly to the likes of YouTube and Hulu.

Both former advertising executives, Masterson and Goodman met about five years at Media Rights Capital, where they helped launch “Seth MacFarlane’s Cavalcade of Cartoon Comedy” on YouTube. MRC was “doing some interesting stuff” in the digital space, says Masterson, but he and Goodman agreed that digital was ready to stand on its own. “We saw a great opportunity to create great content for the next generation of media,” says Goodman.

With connections both in Hollywood and on Madison Avenue, things happened pretty quickly for them. Their first year in business, they allied with Paramount Digital Entertainment, cutting sales and distribution deals for the digital series “The Legion of Extraordinary Dancers” for Hulu. After an introduction to LeBron James’ business manager, they got the wheels in motion for “The LeBrons,” which has more than 50 million views via YouTube and other channels.

The company, which has 15 employees working out of its New York offices, adheres to a lean business model – ramping up with freelance production staff only as needed. Still, digital entertainment isn’t to be confused with low-budget. These shows cost less to produce, says Goodman, but only because they’re catering to the short attention spans of online audiences. Meanwhile, to fund the projects, and ultimately turn a profit, the company isn’t counting on small-time advertisers. “The LeBrons,” for example, was made in partnership with Bing, Intel, HP, Nike and Sprite.

The concept of an all-digital entertainment company isn’t entirely new, says Forrester media analyst James McQuivey. In the late 1990s, he says, Broadcast.com, had similar aspirations and was ultimately a flop. “They got a little ahead of themselves,” he says. Of course, “back then audiences were dialing up on an AOL account.”

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Now that viewers have high-speed internet available on any number of devices, digital entertainment is no longer in its infancy. The challenge now, says McQuivey, is changing viewers habits. “Most people don’t turn on YouTube expecting or wanting to see the next sitcom,” he says. “Viewers are still programmed to tune into television.”

One way to change viewers habits is to build programming around celebrities who help promote projects by sharing them with their Facebook and Twitter fans. “Our premise is to start with creators who can move the needle,” says Masterson.

When Mark Vaiciulis, global marketing manager for Intel, learned about Believe Entertainment’s ideas a couple of years ago, he was intrigued. “We’d done online video in respect to enterprise campaigns but never anything that featured a high-profile person like LeBron in the consumer space,” he says. Intel and its marketing partner, HP, signed on for advertising spots featuring the show’s characters using the products, as well as product placement within the shows. With response rates, or clicks, around 10% higher than the benchmark, the experiment was deemed a success. Intel and HP went on to sponsor the Tiësto project, which has attracted 70 million viewers through various channels.

Believe Entertainment isn’t the only company counting on star power to capture online audiences, says McQuivey. Tom Hanks’ production company Playtone is teaming up with Reliance Entertainment to produce 90-minute animated adventure series “Electric City” exclusively for Yahoo. Actor Kevin Spacey and director David Fincher have teamed up on the political thriller “House of Cards,” which will be distributed on Netflix.

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But for entertainers who don’t already have production companies in place, Believe Entertainment offers an outlet for them to expand their own brands and enjoy more creative freedom than they’d have with traditional media. And rather than align with a single platform, Believe Entertainment determines the best distribution channel for the show and its target audience.

“It’s an indie model for these celebrities,” says Goodman, who wouldn’t give any details about the financial arrangements with celebrity partners other than to say they’re partnerships.  “We handle all the ad sales, financing and distribution, and they focus on the idea.”

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