Famous TV shows like “Game of Thrones” and “Money Heist” made huge waves when it was released.
HBO reported that it cost them $2.37 a viewer per season for Game of Thrones because of the show’s immense popularity. And with a total show budget of $1.5 Billion, the show has earned $3.1 Billion through HBO subscriptions alone.
The same goes for Money Heist, a TV show that left the actors with a substantial net worth, none less than $1.5 million.
That is massive!
With all this, the significant source of income for TV shows still needs to be determined.
Unlike the movie industry, where you can easily track the profit each movie generates, television shows are different.
We can attribute it to the fact that movie industries use Box Office calculations, contrary to TV shows. Yet, most TV series-wide up vast amounts of money before the end of each season.
If you have ever wondered how popular TV shows rake in vast amounts of money, this article will explain how television shows make money, especially in 2020 after the massive hit of COVID-19.
Before showing you how TV shows make money, take a glance at how TV shows work.
Table of contents
How Television Shows Work
TV shows are, beyond doubt, one of the most influential forces of the time.
TV industries are always exceptional, from when the logline gets to the network to when they shoot the pilot episode.
When the network approves a pilot for filming, some activities always occur.
First, the showrunner and producers are hired.
The showrunner is in charge of the show, while the producer hires the crew. The showrunner will work with the writers, cast the actors, and overhead the project to the end.
Sometimes they help hire the director, talent, crew, writers, and assistant producers. Their first task is constantly rewriting or updating the script.
Auditioning the cast is always the next step, and finally, the pilot is shot and edited.
Preparing any TV show involves three stages: preproduction, production, and postproduction.
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Stage 1: Preproduction
The first day of shooting a television series is never the first day that it’s being produced.
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Days, weeks, months, years, and sometimes decades can go by from the beginning of a film’s origination to when cameras roll.
A movie’s production and postproduction processes might be shorter but only can exist with preproduction.
Preproduction is the time that goes into a film before its production. This time determines the quality of any movie series, although it can be daunting for some TV shows.
However, six stages should be included in any preproduction process to ensure a good and successful film shoot from day one.
#1. Preparing a Shooting Script: When it is time to shoot, you must complete the screenplay and convert it into a shooting script. The shooting script must be an easy read for the director, cinematographer, and camera crew, just as it is for the actors.
#2. Getting Storyboards & Shot Lists: This goes hand in hand with Shooting scripts. The storyboards and shot list should create a visual interpretation of the shooting script for the director and cinematographer.
#3. Auditioning the Crew: Filmmaking is all about collaboration, not just shooting. There must be an audition to get the right crew for the series.
#4. Scouting for Location: To get the best location, we recommend you hire a professional location scout who already has locales in mind or knows how to find original ones perfect for your script.
#5. Creating your Budget: This is not an exciting part of the preproduction but is essential. There is a need to develop your budget and make sure you stick to it.
#6. Choosing the Cast: You must find the right cast, no matter how many actors you have in a role. You can use a casting agent to find a suitable model for the series.
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Stage 2: Production
Production for TV shows is filming of the movie.
Out of the three stages of film production, the production phase is where the filming of the TV show takes place. Also, the production phase is where background actors and stand-ins get active.
If you intend to add elements such as motion graphics, animation, or voice-overs in your video, the material will be produced in the production stage.
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This stage brings the written idea of any script into a visual view.
Note: The quality of the film you receive in production must be corrected in postproduction, so ensure the footage from the show is the highest quality footage you can get!
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Stage 3: Postproduction
Once the filming has finished, the project will move into postproduction.
This phase involves editing, sound mixing, and any special effects the project may need. While editing the different TV episodes, the director may reshoot or add another scene.
At this point, the different postproduction crews put their expertise into the project. When the director decides the film is good for the audience, he will move it from the postproduction stage of distribution.
Now you know the different stages of TV show series, let’s look at how TV shows make money in 2023.
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How TV Shows Make Money in 2023
Whenever a movie with a big budget comes out to the market, it is always easy to see the statistics of its earnings from the first one to two weeks.
IMDb often shows some stats such as the budget for the movie, gross, and net earnings.
For TV shows, the case is always different because the audience only gets to know if a TV show will be premiered for the next season. They do not reveal the earning statistics of TV shows to determine when a show is a hit or if it was dropped because of the earnings.
For this reason, people wonder how TV shows earn money.
TV shows make money by renting a show to networks. The networks then earn money by selling ads and subscriptions.
The network often uses Neilsen’s rating to determine whether a show is popular in the targeted segment. More advertisers sign up to show their ads in that slot if it is widespread, and the networks make more money.
However, the Nielsen system in the US is one of the world’s least accurate and most costly viewing management figure systems for TV shows.
Because it only captures a tiny sample of viewing data. Meanwhile, it’s a well-known and understood mechanism, and nobody’s too keen to replace it because they all know how to manipulate it.
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TV show producers also make money by syndicating a show. Syndicate means when a television program is shown on a different television network than the one that first established the program.
Advertisers will line up to pay a premium to get a spot when a show gets very popular. A perfect example is “Money Heist,” which creates history regarding production costs and revenue generated.
TV Shows Revenue Stream in 2023
Online TV is the newest borderline of TV shows. From the emerging business models, producers have more creative control over show budgets, thus limiting syndication.
There are significant differences from when shows go live to the revenue it generates at the end. The gain combines advertising, subscription, pay-per-view, and sponsorship.
Traditional television networks generate additional revenue and brand awareness from online television shows. They often run repeats and second-screen material for a monthly fee or pay-per-view.
The cable television business model is undergoing a radical change. They face a generation of cable suckers such as Netflix, Amazon TV, YouTube, and others.
In addition, major Internet service providers, and traditional non-broadcast media companies, such as print media, are becoming full-fledged television production studios and are moving their TV shows from cable television to online platforms.
However, there has a recent activity for a pay-per-view business model where viewers can watch one or more episodes for a monthly fee.
How do TV Stations Make Their Money?
TV stations generate revenue through several sources, including:
- Advertising: TV stations sell airtime to advertisers to showcase their products or services during commercial breaks.
- Subscription: Some TV stations also pay cable and satellite providers a fee for carrying their programming.
- Retransmission fees: TV stations can negotiate fees from cable and satellite providers for the right to retransmit their local signals.
- Sponsorship and product placement: TV stations may receive funding from sponsors for programming or product placement within their shows.
- Owned content: TV stations may produce and distribute content, such as original programming or movies, and sell the rights to other networks or streaming services.
How Much Do TV Shows Make Yearly?
TV shows have become a large part of the entertainment industry, with hundreds of series airing each year. But how much do TV shows make? This article will explore the answer to this question and provide insight into the profitability of television series.
The success of a show can be evaluated by its viewership. Awards won, and financial success. While some television shows bring in huge annual profits through streaming services and product placement deals, others may not generate as much revenue from their broadcast networks or syndication rights due to low ratings or critical reception.
However, most successful shows will generate at least $1 million for each episode produced. Popular shows such as The Big Bang Theory have also earned up to $10 million per episode in past seasons due to lucrative streaming deals or other revenue sources.
In Conclusion
TV shows make money by renting their show to networks; the networks then sell ad times to sponsors at a rate based on ratings for the show.
This means a network “buys the show” at a fixed rate per season. Then pays the production company that makes the show per episode based on ratings and thus earnings potential for the show.
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