Bar on the floor
The Wrocław-based company is looking to raise more than zł.40 million in order to finance the expansion of its production facilities, pursuing a business model which makes it unique among the country's TV producers. None of ATM's competitors have adopted the expensive strategy of building its own infrastructure rather than renting existing studios. According to Kurzewski, this has allowed the company to become the "definite market leader in terms of price," as investment in state-of-the-art equipment has led to reduced costs and increased efficiency, helping it on the way to capturing a 10 percent share of the local market.
"When we moved from a rented studio to our own, we were able to do eight episodes of a quiz-show in the same time that it previously took to do five," he says, adding that the studio's efficiency could still be improved by 15-20 percent, when a warehouse is added. That is one of the projects that will be financed with the funds raised on the stock exchange. Expanding the shooting infrastructure would also allow the company to make programs for foreign producers at its Wrocław studio. Kurzewski says that the firm is targeting the German market in particular and is planning to set up an office in that country. That way, he explains, German producers could take advantage of the lower shooting costs across the border, which stand at just a quarter of those in Germany.
ATM is also the first local producer to have sold its own formats to foreign producers, ranging from Belarus to New Zealand. One of its original quiz-shows, Awantura o kasę, has also been bought by Freemantle of the UK. Kurzewski was so confident as to crack a joke on ATM's success in building its international reputation.
"How does a local producer sell a format to the UK? You just have to prove that, although you are related to the polar bear, it is quite a distant cousin."
On a more serious note, however, he notes that the firm has spent the last three years building its reputation.
"Some of the moves we have made came as a surprise to our competitors," he says. Why get an ISO certificate for television production? Why be present at trade fairs at New York, Budapest or Moscow? ATM has also been the only local firm present at the Cannes fair.
"Actually, I find myself quite often saying that we are the only firm in the country doing this or that," Kurzewski says with a note of pride in his voice. "But I expect that to change fairly soon."
Still, ATM seems to be the only producer in Poland with the potential to become an internationally recognized brand.
"What kick-started the growth of the global market leaders was a single hit, such as Big Brother," he says. "We also want to go down that path." The world's largest companies derive as much as one half of their revenues from selling formats and ATM would like to achieve a similar structure "as soon as possible." Kurzewski claims that the company has already made the first significant step in that direction: ATM was invited to Cannes this year as one of just four or five producers worldwide to present its product.
"That's when the floodgates really opened," Kurzewski says. More than sixty firms made an approach for the license and, as a sign of the long way the company has come over the last few years, some had to be refused. Kurzewski reminisces on how ATM used to be refused licenses by international producers due to lack of experience. What then seemed to him a discriminatory practice has now become his own policy.
"You only sell to recognized producers, as a format that has been done badly once is burnt on that market," he explains. ATM has now surmounted most of the obstacles on the way to international recognition. It does not, however, make it necessarily a safe bet for investors. One area of concern may be its over-reliance on a single client (Polsat), which accounts for 80 percent of its revenues. Kurzewski counters, however, that for the contracts for future work that proportion is reduced to 60 percent.
Another problem facing ATM is the lack of transparency on the market it operates on. Kurzewski jokes that in this respect he can only say: Thank you very much, Mr Rywin. The situation has definitely improved since the outing of the Rywingate scandal, though it has been the market that has done the most to purge television production of corruption.
"No TV station can afford to air shows that are not up to scratch," he says. And since corrupt decision-making so often results in bad decisions, the quality of programs is lowered; but if people aren't watching, then it doesn't matter who the producer knows - the show is off the air.
"When we moved from a rented studio to our own, we were able to do eight episodes of a quiz-show in the same time that it previously took to do five," he says, adding that the studio's efficiency could still be improved by 15-20 percent, when a warehouse is added. That is one of the projects that will be financed with the funds raised on the stock exchange. Expanding the shooting infrastructure would also allow the company to make programs for foreign producers at its Wrocław studio. Kurzewski says that the firm is targeting the German market in particular and is planning to set up an office in that country. That way, he explains, German producers could take advantage of the lower shooting costs across the border, which stand at just a quarter of those in Germany.
ATM is also the first local producer to have sold its own formats to foreign producers, ranging from Belarus to New Zealand. One of its original quiz-shows, Awantura o kasę, has also been bought by Freemantle of the UK. Kurzewski was so confident as to crack a joke on ATM's success in building its international reputation.
"How does a local producer sell a format to the UK? You just have to prove that, although you are related to the polar bear, it is quite a distant cousin."
On a more serious note, however, he notes that the firm has spent the last three years building its reputation.
"Some of the moves we have made came as a surprise to our competitors," he says. Why get an ISO certificate for television production? Why be present at trade fairs at New York, Budapest or Moscow? ATM has also been the only local firm present at the Cannes fair.
"Actually, I find myself quite often saying that we are the only firm in the country doing this or that," Kurzewski says with a note of pride in his voice. "But I expect that to change fairly soon."
Still, ATM seems to be the only producer in Poland with the potential to become an internationally recognized brand.
"What kick-started the growth of the global market leaders was a single hit, such as Big Brother," he says. "We also want to go down that path." The world's largest companies derive as much as one half of their revenues from selling formats and ATM would like to achieve a similar structure "as soon as possible." Kurzewski claims that the company has already made the first significant step in that direction: ATM was invited to Cannes this year as one of just four or five producers worldwide to present its product.
"That's when the floodgates really opened," Kurzewski says. More than sixty firms made an approach for the license and, as a sign of the long way the company has come over the last few years, some had to be refused. Kurzewski reminisces on how ATM used to be refused licenses by international producers due to lack of experience. What then seemed to him a discriminatory practice has now become his own policy.
"You only sell to recognized producers, as a format that has been done badly once is burnt on that market," he explains. ATM has now surmounted most of the obstacles on the way to international recognition. It does not, however, make it necessarily a safe bet for investors. One area of concern may be its over-reliance on a single client (Polsat), which accounts for 80 percent of its revenues. Kurzewski counters, however, that for the contracts for future work that proportion is reduced to 60 percent.
Another problem facing ATM is the lack of transparency on the market it operates on. Kurzewski jokes that in this respect he can only say: Thank you very much, Mr Rywin. The situation has definitely improved since the outing of the Rywingate scandal, though it has been the market that has done the most to purge television production of corruption.
"No TV station can afford to air shows that are not up to scratch," he says. And since corrupt decision-making so often results in bad decisions, the quality of programs is lowered; but if people aren't watching, then it doesn't matter who the producer knows - the show is off the air.
