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Marblemedia's co-founders and executive producers Matthew Hornburg, left, and Mark Bishop, right, flank Blue Ant Media CEO Michael MacMillan.Steve Craft/Handout

According to Michael MacMillan, chief executive and co-founder of Toronto-based content producer, distributor and channel operator Blue Ant Media, the technical term for the current small-screen environment is “crappy.”

Between the pandemic, rising interest rates, recession fears and a number of U.S. streaming services rightsizing their operations after years of wild growth, MacMillan says that it is hard to shake off the sense of uneasiness and fear in the industry. Which makes it an interesting time to announce one of the biggest deals to recently come along in Canada’s independent television sector.

On Thursday, Blue Ant revealed that it would be acquiring entertainment company Marblemedia, with the two companies’ production and distribution operations to be combined into a new “super-charged” studio and rights business that will be named at a later date.

Marblemedia is known for its slew of original scripted and unscripted series, including Netflix’s Blown Away and Discovery’s A Cut Above. Its co-founders and executive producers Mark Bishop and Matthew Hornburg will now serve as co-presidents reporting to MacMillan.

Blue Ant produces series (such as Canada’s Drag Race), operates distributor Blue Ant International and owns a portfolio of cable and FAST (free ad-supported television) channels including Love Nature, which is available in more than 145 countries.

“We all see the industry malaise, but it’s not going to go on forever because the things that we create are in as big demand as ever – people still love watching audiovisual content. These clouds are going to part,” MacMillan said in an interview ahead of the merger announcement. “It’s a great time for people who are ambitious about the future.”

Blue Ant, which was founded in 2011 and quickly grew into an international media powerhouse after a number of high-profile acquisitions (including Cottage Life Media and Saloon Media), is far from MacMillan’s first marquee venture. The entrepreneur co-founded Atlantis Films in 1978, which would acquire Alliance Communications to form an entertainment empire. The company was sold to CanWest and Goldman Sachs for $2.3-billion in 2007.

Marblemedia, meanwhile, was founded by university friends Bishop and Hornburg in 2001, with the company finding early success in children’s entertainment (notably, Disney Channel hit This is Daniel Cook) before launching its international sales arm Distribution360 in 2010.

Sam Sniderman, co-president of content production for Blue Ant, will now serve as the parent company’s chief commercial officer, working alongside MacMillan and chief financial officer Robb Chase. New York-based Laura Michalchyshyn will continue as Blue Ant’s chief creative officer. Meanwhile, Blue Ant’s Asia-focused production company Beach House Pictures will continue to operate independently out of Singapore.

In a joint interview, MacMillan, Bishop and Hornburg said that the deal’s exploratory stages began a year ago.

“The goal of Blue Ant was always to create a significant, internationally focused content-creating and content-owning Canadian enterprise that would serve the world,” MacMillan said. “This deal was directly in pursuit of that goal, as it has always been the goal of Marble, too.”

“Eighty per cent of our business already comes from the U.S., and that’s not going away,” added Bishop.

Financial details of the deal were not disclosed. The privately held Blue Ant has 375 employees, while Marblemedia has 35, with the two outfits headquartered in offices located around the corner from each other in Toronto’s Liberty Village. The production side of the business ebbs and flows, though, as both companies can have hundreds of freelancers working on sets or in the offices when shows are being shot.

According to MacMillan, the merger will result in “modest” job losses.

“Inevitably there are going to be some, but the purpose of this deal is not to create efficiencies or eliminate costs but to create a company that can grow,” MacMillan said. “In getting more activity going, more shows made and sold, we’ll need more people to do those things. We expect there will be many more jobs created than lost.”

The early days of the pandemic led to a boom in the global appetite for the kind of at-home content that both Blue Ant and Marblemedia specialize in. Yet recent economic downturns could threaten the stability of the international streamers that the Canadian outfits rely upon to purchase programming.

“In the past year or so we’ve seen a reduction in the immediate demand for new commissions by those streamers, so it’s a pullback, but a pullback from what?” MacMillan said. “The previous four years were insane, wild and wonderful times.”

“The streamers were spending silly amounts of money that wasn’t sustainable, and we were all beneficiaries, so we wouldn’t complain,” Bishop added. “But now streamers are looking for new opportunities of doing business and that’s where we’re going to excel.”

The executives pointed to Marblemedia’s recent deal to create the “multiverse teen comedy” series Davey & Jonesie’s Locker, which was commissioned by both Prime Video and Hulu, a rare joint venture between competing streamers.

“Canadians are great at telling stories for international audiences in general,” Hornburg said. “And scripted entertainment is where we see our growth and expansion as these streamers are setting up shop in Canada.”

Those streaming services, including Prime Video and Netflix, have been expanding operations within Canada in anticipation of the Online Streaming Act becoming law this past spring, with Bill C-11 intended to compel foreign streamers to invest into the domestic screens sector. But according to Blue Ant and Marblemedia’s leadership team, the legislation – which would regulate digital streaming services and is currently being studied by the Canadian Radio-television Telecommunications Commission for implementation – was not the driving force behind the merger.

“We’ve already been working with the foreign streamers operating in Canada, and there are a lot of important conversations going around C-11 that we’re active participants in,” Bishop said. “A lot of it still needs to be determined, but there’s already great momentum.”

“I suppose that however C-11 gets implemented it will lead to an increase in production in Canada,” MacMillan added. “And we’re well-positioned for that.”

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