In Wake Of Big-Budget ‘Silo’, AMC Networks Entertainment And Studio Chief Dan McDermott Says Company Will Still Produce For Third Parties, But “It’s Not Our Primary Business”

Dan McDermott, President of Entertainment and AMC Studios, says the studio is positioned to do more third-party productions like Silo, though he noted that “it’s not our primary business.”

The big-budget dystopian drama was renewed last year for a second season on Apple TV+. Production for Season 2 wrapped earlier this year, but a premiere date has not been confirmed.

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McDermott and other AMC Networks execs fielded questions about the company’s original programming strategy during the company’s first-quarter earnings call with Wall Street analysts. One wondered about Silo specifically, given its budget is at the high end for AMC as well as the reality that third-party projects don’t feed the company’s own network and streaming portfolio.

“AMC Studios is a vibrant and productive group that produces for every one of our platforms,” McDermott said. “These shows enable us to build a library, which accrues real value over time for the company and allows us to execute on the monetization of this content. The studio is really important to us. As for producing for outside platforms, our production capabilities and the volume of programming that we produce at AMC Studios gives us the opportunity to be highly tactical and selective. When we have shows like SIlo that don’t fit for us but fit for another platform, we’re going to take advantage of those opportunities. It’s not our primary business, but we certainly envision producing more shows for outside platforms as we proceed forward.”

Silo was called out by the company in its quarterly earnings report, which undershot Street expectations primarily due to ongoing difficulties with shoring up advertising and distribution revenue. Because of the timing of when the series was delivered to Apple in 2023, content licensing revenue in the 2024 period decreased 40% to $62 million. Reports of the show’s cost vary, but its 10-episode first season likely ran into the hundreds of millions, based on just the AMC Networks financials.

Execs were also asked about their approach to licensing, especially when they face a choice of whether to keep programming in-house or take it out to third parties.

Chief Commercial Officer Kim Kelleher mentioned The Walking Dead and Fear of the Walking Dead as recent examples of “rights coming back our way.” Members of the management team “look at each of these franchises very carefully and in a considered way, especially internationally. It’s more region by region. Where can we monetize it most effectively and make sure we’re reaching the largest number of fans? So, it’s not a one-size-fits-all. We’re very very careful and thoughtful about how we license these franchises.”

CEO Kristin Dolan added that in terms of “re-licensing for a bigger sum or keeping it, we really do both, depending on the area. That’s what’s allowed us to continue to optimize our growth in the content distribution revenue line.”

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