(CelebrityAccess MediaWire) —
19 Entertainment Limited, a wholly-owned subsidiary of CKX, together with Simon Cowell, Fox Broadcasting, FremantleMedia and SonyBMG, confirmed they had reached agreements that will guarantee at least four, and as many as six, more seasons of American Idol beginning with American Idol 5, which is set to air starting in January. As part of the deal, Fox reached an agreement with Cowell to keep him on the hit series for at least five additional seasons.
Though the specific financial terms of the new agreements were not disclosed, 19 Entertainment confirmed the following elements of the deal:
— Under the terms of the new agreement with FOX, 19 Entertainment and
FremantleMedia will receive a significantly increased license fee per
season from FOX, reflective of the previously announced increases in
advertising rates for the coming season. Additionally,
19 Entertainment will receive an annual payment tied to its recording
agreement with SonyBMG;
— In addition to guaranteeing at least four more seasons, the agreement
provides for an automatic renewal for up to two additional seasons upon
the show achieving certain readily obtainable minimum ratings in the
fourth and potential fifth years of the deal;
— Commencing with American Idol 5, FOX, whose parent company News Corp.
has recently announced substantial investment in Internet-based
properties, will, at its own expense, build and host americanidol.com,
which is expected to become the show's official website.
19 Entertainment, FremantleMedia and FOX will work together to develop
content for the website and will share the revenue generated under an
agreed upon formula. 19 Entertainment and FremantleMedia, however,
retain the exclusive right to develop and offer premium services on the
website;
— 19 Entertainment and FremantleMedia have granted to FOX certain
wireless telephone rights, including show-related or inspired
ringtones, realtones and video footage. The parties will share the
revenue generated from exploitation of these rights under an agreed
upon formula;
— FOX has agreed to pick-up at least two original shows produced jointly
by 19 Entertainment and FremantleMedia over the next five years. This
is in addition to FOX's recent decision to renew 19 Entertainment's
summer hit So You Think You Can Dance?l
— 19 Entertainment and FremantleMedia will produce certain agreed upon
shoulder programming to be broadcast on the Fox Reality Channel and the
TV Guide channel; and
— SonyBMG will continue as the designated record label for winning
American Idol contestants and 19 Entertainment will receive from
SonyBMG a larger percentage of the revenue from the sales of recorded
music from future American Idol artists.
"We believe the significant increase in our economic share from American Idol under these new agreements, and the unlimited potential offered by partnering with FOX on Internet rights and wireless platforms shows the increasing value of content in a world of newly developing and more personalized methods of entertainment distribution," said Robert F.X. Sillerman, the chairman and chief executive officer of CXK. "These deals substantiate everything we believed when we chose to focus on acquiring premier content and partnering with its creators. With this important step behind us, we can now accelerate our plans for additional growth from our existing properties and through additional partnerships and acquisitions."
"We are extremely excited that FOX has recognized the phenomenon of American Idol by providing the unprecedented guarantee of at least four and up to six more seasons of the show," said Simon Fuller, creator of American Idol and the chief executive officer of 19 Entertainment. "We look forward to working with FOX and our partners at Fremantle to build upon the success of the show and expand the American Idol content and brand into the evolving worlds of Internet and mobile content distribution."
19 Entertainment has also settled its outstanding litigation with Cowell and FremantleMedia. While the specific terms of the settlement remain confidential, 19 Entertainment confirmed that it will receive a minority interest in certain intellectual property and programming related to the X-Factor television program as well as other specified rights with respect to the show. –Bob Grossweiner and Jane Cohen
