ZDFS alum Robert Franke blasts M&A-driven execs

ZDF Studios’ former scripted chief Robert Franke has said M&A deals such as Paramount’s proposed acquisition of Warner Bros Discovery are being fuelled by senior executives who do not care about the content their companies are producing.

Franke, who has been MD at Intaglio Films since leaving his role overseeing drama for ZDFS last year, said the clamour for M&A was being driven by executives simply looking to gain market share and fuel their company’s share prices.

“The people facilitating these mergers are incentivised because they will get a big fat cheque if they complete but they don’t come from the creative fields. Frankly speaking, they don’t give a shit about the content. It is just a balance sheet gain.

“That might be a bit controversial but they all come from Wall Street and a very different environment from the people who used to build companies in this industry back in the 2000s, before private equity really entered the sector.”

Audience fragmentation has led to a flurry of major M&A deals over the past 18 months, with Paramount’s $110bn acquisition of WBD currently coming under the scrutiny of competition authorities.

WBD’s senior team, including chief exec David Zaslav, are set to receive hundreds of millions of dollars in payments should the deal be completed, but Franke told delegates at NEM Dubrovnik that they do not are about the creative on screen.

He described a “culture of corporatism” washing over the sector, adding: “The people running these companies’ objectives are not about making a piece of IP or a show successful. Their only reason and focus is to keep you as a subscriber - for them there is no incentive to make an individual piece of content successful.”

Jamie Cooke, exec vice president & GM of CEE, Middle East, Turkey and Africa at WBD, admitted there was “some truth” in Franke’s comments but pushed back at senior management’s approach to programming.

“I’m not sure it’s about not giving a shit but rather competing priorities - I can think of examples where our chief exec [Zaslav] has really got behind a piece of work and pushed and promoted it,  with the whole team - marketing and everyone else - then getting behind it.

“A lot of the time it is a balance sheet [exercise], there are of course KPI’s around retention and the like, but there are moments when [senior execs do] get behind shows.”

Cooke reflected on his previous experiences of M&A - most recently when Discovery completed its deal for WarnerMedia four years ago - and described his experience as “draining”, admitting: “You can lose a bit of your soul during the process and the people working in those companies can feel that too.”

But he said his job was focused on finding opportunities amid “the chaos”, pointing to WBD’s 2023 acquisition of Turkish streamer BluTV.

“Some of my markets are smaller scale than others and I like that because it can go under the radar. With BluTV, we might not have done that in other markets because of the risk and the KPI’s with mega-mergers, so it’s about working within the chaos.”

Victoria Davies, managing director of Accelerate Consulting, added that she expected future M&A activity to involve tech giants, with Davies and Christian Grece, senior analyst at the European Audiovisual Observatory, pointing to Amazon as one company likely to look for deals to bolster its content library. 

Sandra Lehner, founder of TV Futurist, added that scale moves were driving the market but needed to result in companies that were ”culturally relevant” if they were to succeed, while Damir Vrsajković, chief product development officer at Telemach Croatia, said telcos such as his were well-placed to help integrate numerous streamers and connect services with audiences.