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Next TV: GroupM’s Tortorici Says Brand-Funded Entertainment Has 'Tremendous Potential' On Netflix

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SAN FRANCISCO--In a wide ranging conversation at the Next TV Summit, the CEO of GroupM Entertainment, Peter Tortorici argued that one of the next big frontiers for brand-funded entertainment will be over-the-top subscription video platforms like Netflix and Amazon.

During an interview that also touched on the CBS-Time Warner Cable retrans brawl and his dislike of the term "branded content," Tortorici noted that programmers were frequently prohibited from charging brands for placement in their shows by the terms of their carriage deals with multichannel video providers.

"That prohibition doesn't exist on these over-the top platforms," he said during the interview with B&C editor-in-chief Melissa Grego. "So opportunities for brand placement will develop."

First steps would likely be as organic placement of products in shows but he also expects brand funded entertainment to start appearing on those platforms in the next 12 to 15 months. Tortorici didn't know if they would be the first to break into the category but he did say "I hope we will be the best."

The former network TV executive also complained about the use of the term "branded entertainment," which he said "didn't mean anything."

Arguing that shows like Mad Men and other hit programs were brands, which in effect made them "branded entertainment," he added that he much preferred the term "brand-funded."

Tortorici, the former president of CBS and Telemundo who founded GroupM Entertainment, noted that the category had proved very successful in the last decade and would continue to grow because advertisers wanted content that would "create a context" for them to better engage consumers.

Drawing on his longstanding experience in the TV industry, Tortorici also weighed in on the CBS/Time Warner Cable dispute, arguing that it showed "content is king and owning rights is more important than ever before."

CBS's ownership of popular NFL rights ultimately gave it the upper hand in the dispute with the MSO because Time Warner Cable couldn't risk having subs move to other multichannel video providers once the NFL season began, he said.

Tortorici admitted he had no idea what would be the next big thing but offered some practical advice on dealing with rapid technological change. Pointing to the emergence of social media and over-the-top video much faster than anyone predicted as examples of how difficult it was to predict the future, he said executives needed to have "an active imagination" when thinking about the future and to be willing to be flexible and work collaboratively with other companies that might help develop new content and products.

"I can't say where things are going but I think those are some clues that can help you be prepared," he told the audience.