banner Fidelity
March 6, 1996

New-Media Talent Agents:
Wired and Ready to Deal

When The Spot, a Web soap opera about twentysomethings who share a beach house in Southern California, became an on-line hit, its creators -- Scott Zakarin and Troy Bolotnick -- were thrilled that a talent agent came calling from International Creative Management, the Hollywood agency that represents film stars like Arnold Schwartzeneggar and Madonna.

"Before my involvement in The Spot, I was a filmmaker who couldn't get an agent," Zakarin said. "But after The Spot, agencies were interested in me."

Zakarin had high hopes of quickly leveraging the popularity of The Spot into television and movie dels and perhaps putting the on-line world behind him. So far, only part of his wish has come true: last month it was announced that their agent had negotiated a deal with NBC for Zakarin and Bolotnick to develop a pilot script for possible development as a prime-time series.

But their agent, Steve Stanford -- a former computer software product manager before joining ICM -- had a broader vision of how to exploit the on-line success of The Spot. He made certain that Zakarin and Bolotnick also agreed to create a new interactive Web series for NBC SuperNet on the Microsoft Network and NBC's Web site. The new Web series is scheduled to debut this spring.

"The Internet has become a business in itself!" Stanford said.

This cross media deal has been described as groundbreaking because for the first time, a television network has cut a development deal with Internet programmers to create both a pilot for TV and an Internet show based strictly on the developers' accomplishments on the Internet. It is expected that over time, such deals will be far more commonplace and that on-line talent will increasingly diversify into traditional media while retaining a presence in new media.

"At first I thought that we would make a little bit of money on-line and franchise out," Zakarin said. "But our agent really understands the on-line business, had a model and knowledge base of how to make money on line and helped us to figure out that in fact there is a value to this new form of on-line entertainment."

Stanford had earlier picked up some valuable lessons in how to create a viable on-line product by developing the Oldsmobile Celebrity Circle on America Online. The first fully sponsored chat show on an on-line service, Celebrity Circle created a model in which the sponsor paid all production costs and ICM booked all the talent. The show remains in production on AOL five nights a week.

Of course, Zakarin's agent is not the only deal maker finding ways to cash in on the new media world. Increasingly, the established Hollywood agencies -- including International Creative Management, Creative Artists Agency and the William Morris Agency -- and some savvy independents are honing their skills and involvement in the new-media marketplace, performing the traditional role of talent agent.

As a result, said Jonathan Trumper, a new-media talent agent with the William Morris agency, "We play a strong role in defining new media." William Morris began brokering deals in new media in 1989 and formally created a new-media division four years ago.

"We found early on that there were cultural differences between new and old media that could kill a deal very quickly," Trumper said. "But now we have made a market so that if, for example, somebody needs to hire an actor for a new-media project, we know how to create contracts that are sensible for everybody involved." Gay Young, an independent agent and lawyer in New York who specializes in on-line talent, said, "It's all so embryonic, and I feel as though every single deal is helping to define the industry." Young added, however, that he found the new media "more like film than publishing in terms of the business models we are seeing."

Young says that agents are eager to find products that can be packaged across different media to ensure greater profitability, and that they are looking for clients with a demonstrated ability to adapt to the constant changes inherent to new media.

"If you are a writer, you need to know the rules of grammar, but you don't have to keep on learning new languages," Young said. "But in this business, you do -- and you are required to stay on top of more information than ever before. I look for that quality in my clients."

On the other hand, business models have yet to be clearly established in new media, much content is still experimental, and the industry overall has yet to see extraordinary profits (notable exceptions include the creators of the CD-ROM game "Myst," represented by CAA, and the developers of "Doom" and its sequels, represented by ICM.)

Some in the on-line industry assert that lawyers more so than agents are playing a significant role in brokering new-media deals and that to some degree, on-line services like America Online and Prodigy are reducing the need for a "middle man" or talent agents. Under AOL's Greenhouse program and Prodigy's Wildflower program content developers can apply directly to the on-line service for financing and distribution.

Nevertheless, this has not stopped talent agents from energetically trying to carve a role for themselves in the digital arena, actively seeking out fresh talent at new- media events like the Winter Consumer Electronics Show, E3 - the Electronic Entertainment Expo or the Jupiter Communications' Consumer Online conferences.

Agents are stepping up to represent on-line success stories like The Motley Fool, which received AOL Greenhouse financing and, as a result of its representation by ICM, is now branching out into books and TV.

What's more, agents are positioning themselves to play a new kind of game in the new media: forming strategic alliances, bringing companies to the attention of the investment community and proposing deals where the agents themselves may end up with a piece of equity, as opposed to fees -- an activity that is prohibited in more traditional media like film.

In January, for example, Creative Artists Agency announced in association with the Intel Corporation, the start-up of a laboratory to further the creation of new multimedia entertainment. CAA is also credited with engineering the highly publicized Tele-TV collaboration of Bell Atlantic, NYNEX and Pacific Bell.

Bill Block, an ICM talent agent, manages business operations for Anonymous Entertainment, a new multimedia company. And the William Morris Agency has announced that its agents will represent and take an equity position in a company called Wave Interactive Network that will allow for the distribution of software on a pay-for-use basis.

"The role of the talent agent may be changing and may not be fully defined in new media, said Allessandro Piol, a venture capitalist with Chancellor Capital Management and a founding member of the New York New Media Association. "But what they are doing now is a natural extension of their core business, which is bringing people together to package deals,"

Mark Jeffrey, Director of Online Ventures for The Palace Group, Time Warner, said: "I think that traditional talent agents have a role to play in new media, but it may not be the role that people expect. They certainly have a certain mystique within the world of computers, where companies hope to extend their business into other areas, and I think that agents are also learning that developers are the real talent in new media, as opposed to Hollywood actors."

From the talent agent's standpoint, ICM's Stanford sees untapped vistas.

"In new media," he said, "there are no set deal structures, and we are not constrained in the same way we might be in other businesses like film. But I think that the new paradigms are great, and that's just one of the exciting things about being an agent in this area."

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