The future of production for iZen: less “originals” and more technology

José Velasco and Sara Fernández-Velasco, president and CEO of iZen, respectively, analyze the state of Spanish production based on the current situation of the group of independent production companies, made up of Zebra Producciones, BocaBoca, EuroTV Producciones, Hill Valley, Proima Zebrastur, IndaloYMedia, CAPA España and NewCo Audiovisual.

25 years of experience, 4,700 hours of annual production, 120 projects in development and 32 projects in production and pre-production are the notorious figures that exemplify the intense activity of the group iZen. Through the independent production companies that comprise it, projects in Latin America (Cacao), the push of iZen International (which brings together the UK production companies Chalkboard TV, Storyboard Studios and Clapperboar) and the umbrella of the international group Newen Studios (TF1), accumulates an important portfolio of projects that exemplify a persistent ambition for growth.

Fiction, entertainment, documentaries, theater, musicals, exhibitions, podcasts and feature films They make up this “content factory” that, through each of its production companies, signs important projects in the Spanish ecosystem. Whether in large initiatives aimed at international platforms such as Memento Mori for Prime Video (Zebra Producciones) or the reality the Netflix Insiders (iZen), or in adventures for the broadcast world such as Grand Prix (EuroTV Productions), Asturias Connection (Proima Zebrastur), What a night (Indaloymedia) or A country to laugh at (Hill Valley), iZen develops formats adapted to the needs of each client supported by the muscle that makes up the business group.

The company is progressing in markets such as British and take advantage of opportunities Latin America, while focusing its attention on technology with its own infrastructure and solutions post-production. Close to the latest trends, it analyzes the benefits of IA applied to all branches of your business, and adapts to each new condition of the global market, personified in a period of prominence of the originals which seems to be close to mutating in the face of the instability of the large players.

The world of production, inside and outside one's own iZen, is analyzed by Jose Velasco (president) and Sara Fernandez-Velasco (CEO), which allows us to discover the group's vision of the market and anticipate current trends that, once again, will shake up the game board.

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iZen: from 2017 to 2024

The germ of the group iZen, as we know it today, is set in the year 2017. After a few years in which Zebra was working hand in hand with the audiovisual branches of Vocento, the decision was made to carry out an integration operation with these assets which, as Velasco explains, “were basically Veralia.” “For them it was not a core business given the reorganization of the world of the written press and its diversification into other fields, but for us it did make a lot of sense,” says the president of the company.

The next step was support international growth of the company, which was advancing steadily in England: “We looked for an agreement to buy Vocento's participation and there we found New, a TF1 group company that had an ambition for international growth. Then it had about 15 companies, but now it has 40 throughout Europe"The consolidation in the UK, "very satisfactory with significant growth in the fiction territory", has been complemented with an adventure in Latin America called Cacao, created in a partnership with Non Stop: “We are very present in many territories,” Velasco emphasizes.

Sara Fernández-Velasco: “We are in conversations to continue integrating companies that diversify the type of productions, genres or clients those we work with.”

iZen's ambition is largely based on the role it plays in Spain, a “consolidation” process that has already been overcome, according to Fernández-Velasco, and which translates into six daily productions on different channels of the FORCE, formats entertainment as Grand Prix the big ones fictions as El Cid o Memento Mori. After completing the integration of companies such as Indaloymedia, the president of iZen acknowledges that they are already in “conversations” to “continue integrating companies that diversify the type of productions, the genres or the clients we work with.”

These production companies operate individually, although they receive advice and guidance of the iZen group in its entirety, allowing us to offer clients “the best product creatively, with the best dialogue, production efficiency and best cost”, which forms an ecosystem of “companies of the right size creatively, but backed by a structure that allows them to act as if they were big", in the words of Velasco. "Each brand has its DNA and there is a prior internal and common work of analysis of the group's catalog, market or development, but then each brand presents to each client the contents that are decided," clarifies Fernández-Velasco.

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Local content and global distribution opportunities

Over the past few years, iZen's decision-making has been focused on consolidating its position as global content partner, taking advantage of synergies acquired during nearly three decades of life or the key that represents the Spanish currently. One of its latest initiatives has been its alliance with Non Stop in the form of the production company Cacao to build bridges with Latin America and create stories with reach on both sides of the pond.

The trend of strengthening and creating joint products for the very large LATAM market contradicts the industrial trend of supporting local stories with global reach. What is the purpose of Cacao? Create projects together or take advantage of the group's distribution strength to give a global reach to the projects born from collaboration? Sara Fernández-Velasco sheds light: "I think both. To begin with, it makes a lot of sense to propose content that can travel and have a leg on both sides, but then you come face to face with reality and you realize that everyone is looking for very local products.”

Faced with this situation, iZen, and more specifically Cacao, recognizes that, beyond searching for that definitive story that alludes to all Spanish-speaking viewers, its efforts They are focused on “taking advantage of the distribution capacity outside of Latin America of global content that can be developed for the market from there and vice versa.”

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The end of the predominant model of originals

Just a few weeks ago, both José Velasco and Sara Fernández-Velasco were representing iZen in the market Content Americas. Apart from the future opportunities extracted from the networking that this type of events throw up, Velasco comments that “paradoxically” the most immediate thing that will take place in America will be two originals, that is, content created ad-hoc commissioned by a specific platform, transferring the IP to it: “The plan that you have is one thing and the plan that life has for you is another.”

“Paradoxically” is the key word in the response of the president of iZen, given that the company's vision regarding this model so widespread in the last five years is that is in the doldrums and seems “less efficient in the long term.” “It has been shown that the models of adquisitions or co-productions, combining financing from the production company and third parties, they work better that the originals. They are a lower risk for the issuer and allow them to address a situation marked by budget reductions. with three originals you eat the cost that would allow you to make 15 or 20 acquisitions at a lower cost," details Velasco, who adds other variables of interest such as "tax deductions as a model." And the fact is that, years after the explosion of Netflix, Prime Video o HBO, the classical approach claims its suitability: "It generates a more efficient model for everyone. The producer can maintain the IP in exchange for running the risk of being responsible for production; the streamer or the chain spends less and can choose between more options, and, for the market, it provides additional distribution business, generating wealth in intermediation.”

Jose Velasco: “It has been shown that the models of adquisitions or co-productions, combining financing from the producer and third parties, they work better that the originals”.

Both Velasco and Fernández-Velasco agree that this change in trend does not mean the disappearance of the originals, but yes a logical change in its predominance given the need to better manage resources (in the words of Velasco, “error tolerance is lower”) and the execution of a detailed analysis of your performance, as his colleague explains: "Initially they wanted to take their content to all the countries in which they operated, but in the end they have seen that in some way they are saturating their clients in certain territories with content that they were not interested in. I don't think it makes much sense to pay more to have rights in territories in which your audience is not interested."

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The importance of broadcast today

The arrival of video-on-demand platforms and their interest in the Spanish market has been a relevant part of the production company's business in recent years with formats such as Insiders (Netflix) o Memento Mori (Amazon Prime), although in recent years the group has consolidated its role in Spanish free-to-air television. For Velasco, they are very far from stop being relevant in the market: "Television networks continue to produce and generate most of the consumption. It is true that it is transforming: we make productions in which a part goes to the broadcaster, another part goes to the streamer and the last one we sell to the international market, so they are part of the equation of this business model.” The issue of entertainment deserves a different analysis: "In this area it seems that the models have not yet been fully implemented. I predict that this will happen sooner rather than later and that we will see how the exploitation of entertainment will be done by combining streamers and open broadcasters,” says the president of iZen.

Jose Velasco: “Sooner rather than later we will see how the entertainment exploitation will be done by combining streamers and open broadcasters”.

Fernández-Velasco does not hesitate to scare away the ghosts who point out that "television is in the doldrums", given that for her "the notoriety that free-to-air television has for the purposes of promotion or notoriety is still there." The figures of iZen reinforce this statement: "It depends on the year, but in Spain more than half of our business is in broadcast. If we talk about the volume of hours, we go to 90%, since we will do about 2,500 hours of free-to-air broadcasting. (...) I think this is similar for everyone, but in our case perhaps it is a little more pronounced due to the daily production model we have," comments the company's CEO.

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Technological investment in iZen

Technology has historically been a fundamental pillar for iZen. Taking into consideration the muscle of Proima zebrasture, with multiple sets that are sometimes also rented to third parties, the company has made important technological efforts responding to demands that were not present in the market. For example, the realization of Insiders, reality filmed in 4K with important innovations such as sound capture without the need to microphone each part of the talent. “We have always done it in a very similar way since the time of Globo or Zeppelin, having the capacity to supply us in a certain way," explains Velasco, pointing out as benefits of this model the "optimization of production" or "developing content that could not be done in any other way, such as the first Big Brother”.

The policy has not changed: iZen continues buying equipment that is considered “critical”, leaving for rental houses those resources that have a high update speed, such as “cameras or optics”. This investment continues in full 2024, reveals Fernández-Velasco, given that the group has opted to integrate post production rooms at its iZen headquarters in Madrid: “The idea is to set it up well to be able to provide service to the parts of the group and, why not, even open it to third parties.”

This is the very short term, but in the medium term iZen plans to continue delving into technologies that will allow it to reinvent the way it produces fiction and entertainment. Among them, Velasco mentions the virtual stages (“we believe they are going to change the entire business”), the artificial intelligence (“to improve creative developments”) or the world of VFX and animation: “We are putting our foot down because it will converge with the conventional business sooner rather than later, with many efficiencies and the possibility of addressing content at prices that you could not do before.”

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Exploring new distribution windows

iZen's varied content portfolio, which includes fiction, entertainment, documentaries or even theatrical productions, will grow in 2024 with podcasts thanks to an agreement in terms of sound fictions signed with The Cursed. Fernández-Velasco considers it essential to continue betting on developments that lead to the generation of a value IP, and the audio could be a very valuable window to this end: "We are going to make a sound fiction with La Maldita that can have its own economic exploitation. If everything goes well, of course, we can cover part of its development and, from there, have an IP that allows you to sell a standard audiovisual series. In the end, you have to look for the IP wherever you can."

Sara Fernández-Velasco: “We are going to carry out a sound fiction with La Maldita (…). From there, we could have a IP that allows sell a standard audiovisual series. In the end, you have to look for the IP where you can”.

Velasco, aligned with his partner's vision, is committed to continuing exploring new roads such as the possibility of “combining live entertainment with audiovisual IPs” or podcast models, although it identifies a valuable opportunity in the exploitation of digital content. The problem is the how: “There has not been a consistent model other than the pure one of influencer that generates content almost individually. That is to say, there has not been a very effective industrial organization from the point of view of a producer.”

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The key concepts of the iZen of 2029

Production in Spain in the last five years has been supported (or conditioned) by key concepts such as VOD, originals, glocal o COVID that have allowed an opening of the Spanish industry to the world as partner for the execution of all types of initiatives. When encouraged to reflect on the terms that will mark the future of production until 2029, Fernández-Velasco questions: “Being philosophical or pragmatic?”.

From the pragmatism, the CEO of iZen considers that the artificial intelligence, virtual production and tax incentives In order to attract productions to Spain and be competitive in the international market, they will be fundamental axes of national production. Velasco takes over to address the issue from the prism philosophical: “If what we want is a model in which Spain can play a different role, we have to differentiate ourselves in something. For now, we have done it when talent is cheaper and more creative. We have been able to tune in to global trends from local content, which is interesting if you add that we have 600 million people who understand Spanish.”

Jose Velasco: “Thanks to the IA they will be able to be carried out more specific content, done better and faster, and all the data will be available practically automated. (…) We will be able to predict success and failure from the content and not from observation”.

Along these lines, the president of the group considers that it is necessary enhance production and the role of independent producers, since the value of "divided or controlled integration" models is increasingly evident: "The model in which the producer takes the risk, arms and seeks financing is more similar to the market economy and seems better to us. If it is established compared to the model of originals, Giant fertility will be generated and this will probably make the business more profitable and will lead to the survival of those who do it best.”

Finally, Velasco does not forget the variable of technology, an area that is going to undergo a "radical change": "The suitability of content to audiences will be better defined. Thanks to AI, more specific content will be possible, done better and faster, and all the data will be available in a practically automated way. I'm not saying that a custom script will be written, but we will certainly be able to predict success and failure from the content and not from observation. This will probably redefine the business over the next few years”.

A report by Sergio Julián Gómez