With a Murdoch in charge, a startup leads the way on mobile video

Glendale, California

A YOUNG actor with a bushy goatee, cast as a Satanist on a murder-mystery show called Solve, sat facing a camera on a stuffy, no-frills set in July. Six tenderfoot crew members stood sweating in the shadows nearby. One was staring at his iPhone's stopwatch.

The director, doubling as a camera actor, told the actor: "Now give me a take where you're exhausted. You've been up all night worshipping Satan in this one. Ready? Action!"

It was no good. "Too long," the iPhone guy said glumly. "That was 22 seconds." Orders were given to redo the scene - preferably in an 18-second take. Perhaps try a "jittery" Satanist.

This is the down-and-dirty future of television as practiced by Vertical Networks, a startup founded by Elisabeth Murdoch, the media entrepreneur whose father is Rupert Murdoch. While her dad and brothers, Lachlan and James, have been busy selling the family's old-line studios to the Walt Disney Co, she has quietly built Vertical into a major supplier of app-based video series for mobile devices. The stories are told in short bursts - 20-second scenes, and episodes that last mere minutes - that rely on whiz-bang production techniques (split screens, on-screen text) and are filmed vertically instead of horizontally: MTV for Generation Z.

Ms Murdoch, 50, said in an e-mail: "I wanted a front-row seat in seeing this new world unfold. It's harder than it looks. Great mobile video is unforgiving, labour-intensive and often counter-intuitive to produce."

By relying on research, Vertical has figured out how to engage teenage viewers on Snapchat, for instance, even as proven hit-makers like WarnerMedia and Viacom have been slow to gain traction. Vertical-produced hits on Snapchat include Phone Swap, a dating show in which participants snoop through each other's mobile devices and which attracts an average of 10 million viewers per episode.

Solve, which details a crime inspired by real events and then asks viewers to sort through potential suspects, debuted in May and draws a similar audience.

Adam Lederer, 27, the showrunner for Solve, said: "It would be your Law & Order' if you were 13."

Vertical, which counts Snap, the parent of Snapchat, as a minority investor, also makes shows for Facebook (I Have aSecret) and YouTube (Yes Theory). Vertical said its original content - including Brother, a digital magazine for young men that publishes daily on Snapchat and Facebook - attracts more than 50 million monthly active viewers.

Ms Murdoch's startup is profitable, a spokesman said; ad sales contribute the bulk of its revenue. Nike, Intel and Warner Bros are clients.

As the traditional TV business has faltered with younger audiences forgoing cable connections and broadcasters struggling to compete with Netflix, Hollywood has started to get serious about reaching the mobile masses. Disney is paying US$71.3 billion for vast swaths of the Murdochian media empire to supercharge its app-based streaming plans.

Elisabeth Murdoch declined to comment on the sale.

Jeffrey Katzenberg, the DreamWorks Animation founder, said last month that his new venture, WndrCo, had secured US$1 billion from investors that include Universal, Sony and Paramount to create high-quality, bite-size content intended for mobile viewing.

Some conventional media companies, including NBCUniversal and Condé Nast, have found some success in this realm. So far, however, the winners in "mobile-first" original series have largely been scrappy startups like Vertical.

Tom Wright, Vertical's chief executive until recently, said that the biggest mistake Hollywood makes is arrogance. "It's the classic 'We will give audiences what we want, and if they don't want it, well, it's their fault for not recognising our brilliance'."

With Vertical, Ms Murdoch wanted to experiment. Could the upstart studio find novel ways to entertain 13- to 25-year-old users of apps like Snapchat - and spin off that content into traditional television shows, books and other media?

She has reached a verdict after two years of stops and starts. "It looks like we can," she said.

Last month, Vertical adapted Phone Swap for television, a first for any Snapchat original series. (The social network has released dozens of shows this year.) Fifteen Phone Swap episodes - lasting 30 minutes each, compared with about four minutes on Snapchat - ran on local Fox stations as a test for a full-blown syndicated series. The Fox Television Stations Group will decide whether to order more Phone Swap in mid-October, when it typically makes decisions about its summer test shows.

Vertical will also publish an advice book based on its Brother e-magazine, which specialises in audacious lifestyle tips. An example from a recent edition: "Fun fact! Eating snot keeps bacteria from sticking to your teeth!" Irreverent content succeeds on Snapchat, which has 188 million, mostly young, users.

"If we're not giving them three things to look at simultaneously, we're losing them," said Bailey Rosser, Vertical's director of audience development. "Mobile viewers are used to constant stimulation. Consider how much visual info your brain is processing at it scrolls through a Facebook feed or scans your home screen for app notifications."

And use the word "you" as often as possible in mobile content, she advised. "I'm serious!" she said, after a reporter shot her a skeptical look. "This audience is narcissistic."

Some rival studios snipe that Vertical has benefited from close ties to other Murdoch-controlled businesses. The Phone Swap spinoff ran on TV stations overseen by Ms Murdoch's father, for instance. Under a recent deal, Fox also handles advertising sales for Vertical Networks. (Disney is not buying the Fox local stations or Fox broadcast network.)

Vertical's former chief executive Mr Wright and his successor Jesús Chavez dismissed that criticism as jealousy, and noted that they had several non-Fox television projects in the works.

"We've been disproportionately successful because we have built an amazing team that leans really heavily into audience insights," said Mr Wright, who remains involved in the studio. "The default is to lean into the expertise that you already have - to do what you already know."

Mr Chavez added: "It's not just TV for a smaller screen. There is a real expertise." NYTIMES