South Park will continue for another five years as a major cable presence and simultaneously as one of the biggest streaming properties with an extension of its Comedy Central deal together with a huge re-up of its Hulu deal. The streaming service will pay Viacom and the show’s creative team $192 million over five years, according to sources.
The two pacts — adding three more years to the two remaining on the existing Comedy Central and Hulu contracts — marks a new symbiotic strategy between conventional and streaming television.
For Comedy Central and its parent Viacom, its 50/50 split of the Hulu deal with the show’s creators, Trey Parker and Matt Stone, represents one of the first instances where digital monies will underwrite current production costs.
For Hulu, the show targets a vital digital demographic and is a key element in building the streaming network’s competitive position against Netflix and Amazon.
For Stone and Parker, who will continue to write and direct every episode — with $110 million earmarked for the creative team over the five-year period — it’s a capstone of an 18-year show run that will raise South Parkto a more than 300-episode library and a long-term, if not permanent, television franchise.
It is also for Stone and Parker something of a vindication of their efforts to crack the digital code for television, both in their early decision to hold on to streaming rights, and in their part in television’s digital piracy battles. South Park, among the television industry’s most pirated shows, was a central issue in compelling Viacom in 2006 to sue YouTube and owner Google, widely seen as setting the framework for tougher pirating policies at major platforms and for YouTube’s current licensing model.
“This is now particularly satisfying,” said Stone in a recent discussion. “It comes full circle since the tech guys came to Hollywood and said you better give us your stuff for free to put online or else it will be taken from you anyway.”
The deal, too, is evidence in Viacom’s argument that the recent ratings drop at its cable networks marks not so much a weakness in cable but an as-yet-largely-unmeasured expansion of the audience across digital platforms. This deal helps monetize that shift in audience.
At Comedy Central, facing the departure of Jon Stewart at The Daily Show in August, the deal keeps in place the network’s central tentpole. “South Park is one of the foundations on which the house of Comedy Central has been built,” said Viacom music and entertainment group chief Doug Herzog, who first signed the show in 1997.
For Hulu, South Park marks its biggest content deal yet — after its $160 million pact for Seinfeld announced in late April and its deal with CBS for all 300 episodes of CSI — in its effort to build a streaming network that competes with Netflix and Amazon by acquiring major franchise television. “Very few shows in the history of television will have made it to 23 seasons,” said Lisa Holme, Hulu’s VP of content acquisition.
In addition to the availability on Hulu of the entire library of South Park — one of Hulu’s consistent top draws — current shows will be available a day after airing on Comedy Central, a significant differentiator to almost all of Netflix’s licensing deals.
Hulu, jointly owned by Comcast, Disney and 21st Century Fox, has been refocusing its business model from free, ad-supported programming to a Netflix-like $8 monthly subscription model (though some programming will still be available for free). At the same time, Hulu runs the South Park website, selling ads against a free, curated selection of episodes.
For Stone and Parker, whose “creative studio” is one of the industry’s most innovative and successful talent entities — holding the South Park TV and video game franchises, as well as the team’s hit musical The Book of Mormon — the deal marks another step in its long-term bet on the expansion of television. “South Park was one of the first shows sold on DVD, the first basic cable show on off-network syndication and the first to retain its streaming rights,” said Stone and Parker’s partner, entertainment lawyer Kevin Morris, reflecting on the deal.
For Stone, the deal most of all indicates a new level of maturity for digital television in its relationship with the creative side of the entertainment business. “Digital now represents not only a real audience, real money, real competition and a real marketplace, but there’s finally an understanding that the business is going to have to rely on the talent community and the franchises that it has built and not on algorithms,” said Stone.
“You can’t have shows like ours without someone like Doug Herzog who knows how to bet on talent and deal with talent,” he continued. “That’s not what you get from the technology business. Frankly, in the past I haven’t much liked dealing with the people from Silicon Valley. I don’t like our stuff being talked about as content. Spoons are metal and guns are metal, but they’re not the same thing. We don’t make content. We make television. And that’s now what digital understands it has to pay for.”
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