Is Hogarth a threat to Australia’s commercial production companies? Is this another Plush? One production company EP fears the worst

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What do production companies do.jpgIn response to the launch by WPP AUNZ of Hogarth Australia last week, one independent Australian production company producer, who wishes to remain anonymous, has emailed this response, fearing Hogarth could be another Plush.

Along with the launch of Publicis’ Prodigious, which is currently being ramped up in Australia, I believe Hogarth Australia could be a threat to creativity in Australia. There are far reaching ramifications of this model that fall into two categories. Obviously Plush didn’t work, but the general feeling is that this time, they are here to stay.

Category one: In the US and Europe there are numerous examples of internal production companies of agencies a) asking external production companies to submit a high bid so that they internally can submit a lower bid for the same project thereby showing their client why it’s better to go with them, and b) receiving external directors’ treatments, and then using that IP as ‘inside information’ to make their own proposal look better to their clients – using that IP that is not theirs. Let’s hope that is never the case in Australia. 

The second category is one that is less obvious. Traditionally, good production companies have taken on young wannabe directors, and financed the beginnings of their careers, by underwriting low / no budget jobs from agencies and teaching / coaching these young directors, helping them develop and seeking out opportunities to develop their reel. Over time, these directors develop their craft, learn, grow and become better directors in the market. 

With internal companies however, they use young directors who are cheap, in a race to the bottom of budgets, and have no care or responsibility to that director’s career and development (like a good production company would have). The internal company has no vested interest in creativity, just in how much they can double dip from their clients, under the guise of being able to do it faster, cheaper etc.

I know of some examples where some reputable TV departments within agencies in a network have been mandated to get a ‘bid’ from their internal production company, as one of the standard three bid process. The internal company has not been able to do it cheaper, nor provide a quality director. The reason they have not been able to do it cheaper is that good production companies have relationships with suppliers who they treat well, respect, and honour those relationships – supporting each other and the industry. So when a favour is needed – on a low budget job for example – it can be given. This is not the same obviously for a network’s internal production company.

I also know of a major multinational – one of the biggest FMCG groups globally, that are completely against the idea of their agency’s internal production company and refuse to use it on account of feeling that they are not getting market rates, nor access to the best directors – which are fundamentally tied up with good production companies.

Creatives hate the idea and generally want to have nothing to do it as 99.9% of the freelance directors aren’t that great – the good ones are snapped up by production companies. Creatives hate it. Agency TV producers hate it.

I believe the local Aussie production body, the Commercial Producers Council (CPC) has been discussing it and is preparing to release guidelines around dealing with internal production companies.

But what I think is really pertinent at this point is that the CPC is run by The Communications Council. The board of directors of The Communications Council has CEOs, CFOs of these network agencies who have inhouse production – so there is an absolute conflict of interest with the Comms Councils running the production body!!