It’s like how Peacock paid NBCUniversal $500M for The Office, even though Peacock is owned by NBCUniversal. Or how HBO Max paid Warner Bros $425M for Friends, even though HBO Max is owned by Warner Bros.
If a studio owns a streaming service, how exactly is that streaming service paying that studio for the content? Is the studio just paying itself? How exactly does that work and why do they have to do it?
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Yes at the “studio” level it is likely just paper money getting moved around. But there are checks getting cut down below. Basically why boils down to office politics.
While you’re correct to say that NBC Universal is buying The Office from itself, in the office politics it is better to say the VP of NBC Streaming is buying The Office from VP of NBC Entertainment, producers of The Office, and anyone else with residuals. (Who exactly signs is unimportant). Yes this is encouraged by the bosses above the VPs but the $$ assigned to VPs are important.
So VP of NBC Entertainment has targets and bonuses. He makes money when he sells his shows. He would like to sell to Netflix/Amazon for $$$. So his bosses say we will give you sales dollars for playing nice with VP of NBC Streaming. Likewise the producers / residual holders get paid when shows re-sell. They would complain quite a bit with lawyers and such if the payments from The Office went from a lot to zero. So again a “sales” price is documented and used to payout 3rd parties.
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