Back in 2009 just as season five was getting ready to start, I researched and wrote an article that gave a detailed analysis on why Supernatural was a profitable little franchise for their parent studio Warner Brothers. Studios do not release revenues on individual shows (then or now), nor do they release costs either, so a lot of that article pulled together what was known at the time and did some basic number crunching.
The studios still haven’t changed their tune when it comes to revenues and expenses, but a bit more is known now that Supernatural has hit the second run syndication market. Supernatural today still doesn’t make The CW much money, but it really rakes it in for Warner Brothers. Considering Warner Brothers owns half of the network, it becomes the classic â€œrobbing Peter to pay Paulâ€ scenario. The losses on the network are more than made up with the revenues from other sources.
So what’s changed since September 2009? Tons. Let’s just say that the past two years have been very kind to Supernatural. Get your math caps on, a bunch of numbers are coming your way.
What’s different since 2009:
Supernatural hit 100 episodes. The grand plateau. The magic number that boosted Supernatural’s per episode premiums from $300,000 an episode (roughly) to $700,000 an episode (a little less roughly). The current number available for second run syndication is now 126 episodes, with another 23 guaranteed at the end of this current season.
Supernatural was picked up for second run syndication in a number of outlets internationally and TNT in the United States. It currently runs two episodes a day Monday through Friday on that network.
Since the show is in its seventh season, Supernatural is getting more expensive to produce. Jared and Jensen are both making more money per episode now and will every year the show continues. Below the line costs for the crew continue to increase because of union agreements. The show still runs on a very tight budget though and because of some cuts hasn’t seen that much of a cost increase. For example, there are a few less producers on staff these days and Misha Collins was released from the show. Classic rock is all but nonexistent anymore. The current budget is estimated at slightly under $50 million per season, but that is with an extra episode. Per episode cost runs at approximately $2 million to $2.2 million an episode. While Supernatural does get tax breaks for filming in Vancouver, just like in 2009 the strong Canadian dollar against the US dollar has all but wiped out any savings with exchange rates.
Supernatural is making more in ad rates for The CW this year, but slightly less than 2009. A lot has to do with the move to Friday, in which ad rates are cheaper. According to the annual Ad Age survey, Supernatural is only making The CW $32,477 per 30 second spot. That number was $29,100 in 2010 and $32,988 on Thursdays in 2009.
Got all that? Great, now let’s talk revenues.
Supernatural’s Revenues in the United States
The CW no doubt is a struggling network. It’s got some serious problems getting exposure and it caters to an audience, the 18-34 demographic, that doesn’t exactly watch their TV shows live routinely. Their woes though are nothing new though compared to 2009. What has changed is they got a new boss, and he’s trying to think outside the traditional network model box.
The most relevant deals made lately have been with online providers Netflix and Hulu. Both deals will not only bring revenue to the parent companies of CBS and Warner Brothers, but for once The CW itself can get a piece of that share. This will help offset some (or perhaps most) of their annual $50 million in losses and will give them some money to develop new shows so they can start airing programs year round.
The Netflix deal brings in HUGE dollars for veteran CW shows. Both Variety and The Wall Street Journal gave some concrete numbers on this groundbreaking deal, which potentially will earn up to $1 BILLION for The CW and it’s parent companies over ten years. How come that much? Because Warner Brothers and CBS sold online streaming of their CW catalogs to Netflix exactly like a traditional second run syndication deal. According to Variety, â€œLong-running series under the deal will fetch a license fee in the $700,000 range, while the less-proven shows will start out with a fee estimated in the low six figures.â€
Three shows fall in that $700,000 range, One Tree Hill, Supernatural, and Gossip Girl. That number is PER EPISODE. One Tree Hill (seasons 1-8) has 174 episodes, Supernatural (seasons 1-6) has 126 episodes, and Gossip Girl (seasons 1 – 4) has 87 episodes. Considering this deal extends four years after a show has stopped airing on The CW, this means Netflix will be picking up future seasons when they are available. So being added onto that total next year is One Tree Hill’s final 13 episodes, Supernatural’s 23 episodes, and Gossip Girl â€˜s 24 episodes.
Who has their calculator out yet? Total upfront money for streaming Supernatural seasons 1-6 comes to $88.2 million. Season seven when completed adds another $16.1 million. That’s $104.3 million. The information revealed doesn’t specify if a veteran show’s per episode cost will go up with each new season added (the answer is yes for newer shows), but every new season will definitely add something to the pile.
Remember Supernatural’s budget a year? This deal has more than paid for two seasons already, and will pay for more in the future. This is just one deal.
Things get tricky beyond this. You see, a lot of CW shows aren’t viable for multiple second run syndication. In the US anyway. Internationally, they all get around. Why? The Variety article gives this explanation. “CW fare is newly attractive to this new generation of buyers in the SVOD window because its style of serialized drama, with a narrow demographic target that has made its programming a challenging sell to TV stations and cable networks, is much more conducive to the on-demand environment, where episodes are more easily digestible in binge viewing patterns than weekday stripping.” Want that in English? Younger viewers watch CW episodes all at once.
Supernatural may not be a sell for local stations, but it at least is enjoying a run on TNT right now. So did TNT pay $700,000 per episode? Every deal is different and not publicly disclosed, but that is going market price for this show right now. Warner Brothers traditionally hasn’t been known to give too much away, but TNT is an “in house” network for parent company Time Warner. Seasons 1 – 6 are airing right now twice a day, so it’s probably safe to assume that’s another $88 million in revenue for Supernatural in second run syndication.
Then there’s the deal with Hulu in which the five most current episodes of each CW show will stream on that site. When each episode airs, it will be available on Hulu after eight days for their free service, or one day for those subscribing to Hulu Plus. This deal is good for five years and only applies to current CW shows. Any money that Hulu pays for these episodes (which wasn’t disclosed) will likely be all revenue for The CW, since they control distribution rights for the current seasons in the US. If anything, airing on Hulu will give The CW more exposure, but there is definitely some question as to whether it will encourage more live viewing.
The best thing about the Hulu and Netflix deals is that The CW shows aren’t limited to just those online services. They can be sold anywhere. So as more online outlets come along, expect more deals. Online video on demand (VOD) is the wave of the future. So the experts think anyway.
The other main revenue stream in the US for Supernatural is DVD sales. This has proven to be a nice little money maker for the show. They have been really big since season four. Back when I wrote my article in Variety for Supernatural’s 100th episode, I was given a confirmed number that nearly 2 million DVD sets had been sold for the first four seasons. I don’t know if that was just US or worldwide, but I’m assuming based on those numbers that’s probably only US. Average revenue from a DVD set is $30 (DVD and Blu-Ray). That’s $60 million. Season five has sold at least 500,000 sets since then, and season six so far has sold around 200,000, plus seasons 1 – 4 has sold more as well. Assuming the tally is 750,000 (my numbers only being based on US sales), that’s another $22.5 million.
It should be noted that Supernatural is always among the top selling TV on DVD sets each year, outgrossing most of the big network shows and even top ones on cable. Warner Brothers puts in a lot of promotion for the DVDs, so that that cost bites into a bit of that revenue, but it still earns plenty.
I hear you all, “What about iTunes?” The studio gets most of the revenue, around $1.70 per episode downloaded (around $2.60 or so for HD). However, downloads run in the 70,000 – 100,000 range per episode. That’s about $200,000 average per episode, around $4 to $5 million per season. That isn’t considered a lot by Warner Brothers’ standards.
(Coming up on page 2, the real money comes from the international markets. See how many countries Supernatural is in).