ƒ Curious Travelers Television: Rick Steves' Backdoor to Europe - The Economics of a Travel Series

Wednesday, August 24, 2005

Rick Steves' Backdoor to Europe - The Economics of a Travel Series

Rick Steves has to hold the record of creating the most economical travel shows. For his thirteen episode half hour series:

His crew is a total of three people:
- Rick Steves - The presenter
- A cameraman - usually a local, so he doesn't have to pay for flying in and housing him.
- A director

Probably if he wanted to he could do away with the cameraman and have a crew of just two people. I personally like to work with a team of at least six - director, producer, soundman, cameraman, presenter and local fixer. I think it's a more enjoyable way to work and you can make a better program.

He doesn't even have a soundman, which is the reason most of his programs are voice over narration. He writes the script as a treatment, only about ten pages for a thirty minute program, then looks for locations to shoot and has a few on camera segments, with the camera on a tripod and a lavalier wireless microphone.

The Total Budget for thirteen episodes:
$500,000 for thirteen half hour segments, so each episode costs a total of $38,461.53 per episode.

Each episode takes one six days to shoot and he shoots an hour of video a day on average.

Most of the expense is in the post production. It's edited and all the post production is done by the staff at Oregon Public Broadcasting, the presenting station, who are paid well for their services. Rick Steves provides a steady source of income to the station.

Public broadcasting pays for half of the shows costs, through a production loan which goes to paying for the post production. Rick Steves pays for the other half out of his pocket and the crew members, including Rick Steves, work for a small salary and a deferred salary.

After the programs air on Public Broadcasting for free in a type of syndication used by American Public Television called exchange, they are sold sparingly to other cable television outlets domestically and internationally -even more sparingly - for very little money but enough to cover all the production expense and also make a modest profit.

The program also receives an income from the DVD's they sell at the end of the program through a web site address and 800 number. Each eight hour DVD sells for $19.95 and cost about $2 each to manufacture.

Once the network's loan is paid off Rick Steves pays off the deferments to himself and the crew, then the profits are split three ways equally among the production company Backdoor Productions, the PBS network and Oregon Public Television, the presenting station.

In addition the program has an underwriter, an advertiser that pays a small fee for a 15 second "announcement" at the beginning and end of each program. In the case of Backdoor to Europe, the underwriter is American Airlines. Underwriting is fairly difficult to get for a new program, as the underwriter is understandably interested in a track record for the program that proves their are a certain number of viewers. In addition underwriters tend to stay clear of travel programs or any programs for that matter that are anyway controversial. Rick Steves shows are certainly not that. In fact they are fairly bland family fare programs, so he can get underwriting while more edgy programs such as Anthony Bourdain's "No Reservations', with its countless references to his genitalia probably can't, not a problems when the advertising income is acquired from Discovery's vast ad-sales department.

Rick Steves programs are fairly popular on PBS, ranking sometimes in the top five programs viewed, so underwriting is no problem and the revenues for it guarantee in advance of cable and DVD sales a certain amount of profit.

So that's it in a nutshell, how this business works, or at least how Rick Steves series is produced. Of course the economics for a far more expensive program such as Globe Trekker is different, as are the programs on the Discovery Travel Channel and the Fine Living Network, which are mostly work for hire commissions

Keep in mind that Rick Steves main business is not producing travel programs. The programs are really infocommercials for his other business, a twenty million dollar a year tour business and guidebooks. If the budget is the lowest in the industry it's for good reason. He knows the income the program can generate and has adjusted his budget accordingly.