Looking to rebound financially since going public in March and looking to expand Snapchat's reputation beyond just funny filters, Snap announced on Monday that it has entered into a $100 million original programming development deal with Time Warner. Both companies are committed to developing up to 10 shows per year that would include a mix of scripted dramas and comedies for the app (with a typical show running five minutes or less). Time Warner is also committed to buying ads on Snap over the next two years for HBO, Warner Bros, and its Turner networks (including Cartoon Network/Adult Swim, TruTV and TBS). Ad revenues from the shows they co-produce will be split between Time Warner and Snap.
For Snap, this deal couldn't have come at a better time: the company has watched its shares lose more than 26% of their value since the company decided to go public in March and after continued disappointing user growth numbers. Original content has become the order of the day, with even Twitter and YouTube going the way of Netflix and Hulu by investing in original programming for their viewers/subscribers. Snap sees their format as offering networks' a fresh and unique platform to work with: two to three new episodes per day, with each episode of a show running between three and five minutes. For a network, this can help get your advertising message out there in a short period of time and for a relatively small budget: The Wall Street Journal reports that some episodes cost less than $6000 to produce.
This isn't Snap's first venture into original content: earlier this year, Snap premiered Boycott, a scripted comedy from Saturday Night Live about a couple trying to boycott all things Donald Trump in their lives that was specifically created to take advantage of Snapchat's abbreviated time and vertical viewing experience. Building upon the traction gained from the success of Boycott, Snap has signed programming deals with a number of companies such as BBC, ABC and A+E Networks to boost the original content on their two year old Discover content platform. For the networks, it's another chance to reach potential viewers who might not "live" online or with their televisions. As Scripps Networks' Henry Ahn, president of content distribution and marketing, noted when his company announced that they would be bringing original HGTV and Food Network shows to Snapchat:
"Snapchat's distinctive mobile platform provides an ideal environment for us to touch millennials and centennials who may not yet be hooked on our premium offerings. We're finding more and more new fans among the hard-to-reach mobile natives."