A two-year deal between Time Warner and Snap will see the latter’s social media tool Snapchat host 10 new shows.
Snap has had an incredibly busy 2017, with an IPO earlier this year complemented by numerous acquisitions and a fine-tuning of the company’s business plan.
Its latest deal, however, will have the most customer-facing effect yet.
A broad partnership between Snap and Time Warner will see the latter create up to 10 original shows for the Snapchat app, with Turner and Warner Bros set to commission scripted drama and comedies.
New way to watch
The new deal may ultimately see Time Warner’s premium network, HBO, develop shows for the app, which would be a surprise, as its audience and Snapchat’s demographics aren’t exactly identical.
Snapcat’s shows tend to max out at around five minutes, with the platform appealing to a younger user base and, therefore, threatening established media companies.
So, while other content generators such as Netflix, Hulu or even HBO are busy creating groundbreaking shows consisting of hour-long episodes, Snapchat’s snappier medium is capturing the next wave of consumers.
The deal is valued at around $100m, which encompasses both the creation of the shows as well as advertising commitments from Time Warner’s various arms.
Snap has driven the “evolution of media”, according to Gary Ginsberg, Time Warner’s executive VP.
“We’re confident this partnership will help drive larger audiences to our shows and to the new direct-to-consumer platforms we continue to roll out,” he said.
In March, $3.4bn was the total value of the company’s IPO, largely deemed a major success. In May, Snap spent around $1m on Ctrl Me Robotics, a small drone manufacturer based in LA. It has pushed its Spectacles project quite a bit this year, too.
Geofilters are a cash cow
It’s the business of geofilters that is helping Snap turn over revenue, though, and it’s here that the company has been most active.
Snap acquired Placed last month, a US adtech start-up that measures whether online ads actually lead to store visits and offline purchases. The company’s offering will allow Snap to validate geofilters, something that’s becoming more and more important to the company.
In April, Snap acquired the geofilter patent belonging to Instagram competitor Mobli for $7.7m. Mobli, the company that was co-founded by serial entrepreneur Moshe Hogeg, patented the idea of geofilters in 2012.
Geofilters are photo filters based on a location, which can be bought by advertisers. Around $360m of Snap’s $400m revenues come from geofilters.