Anyone who's been watching The CW this fall is intimately familiar with the tangled lives of a certain upper-crust group of New York City teenagers. But the penthouse-living, private-school-attending, alcohol-swilling high schoolers portrayed on Gossip Girl were already popular with America's teens, thanks to the bestselling book series of the same name that Alloy Entertainment created. The media division of Alloy Media + Marketing, which owns various teen-oriented businesses, Alloy Entertainment established itself as a go-to YA packager in the late '90s. Despite the controversy about Alloy's role in last year's plagiarism scandal that forced the withdrawal of Kaavya Viswanathan's How Opal Mehta Got Kissed, Got Wild and Got a Life, the company has morphed from a well-known publishing packager to a Hollywood player.

“We've always been a traditional book packager... focused on fiction and dedicated to developing our own ideas,” said president Leslie Morgenstein. “The biggest distinction now is that, for the past five years, we've been active producers in film and TV.” To that end Morgenstein and his v-p, Bob Levy, who serve as executive producers on Gossip Girl, are taking that same role on almost all of Alloy's current and forthcoming TV and film projects. (In addition to two movies in production—The Sex Drive and The Sisterhood of the Traveling Pants 2—Alloy has more than half a dozen TV projects brewing, with one, Samurai Girl, already in production for ABC Family.)

Alloy Entertainment got its name when Alloy Media + Marketing acquired 17th Street Productions, a children's book packager founded in 1987 by Daniel Weiss. Since then, the company's track record has been impressive. With Little, Brown alone, Alloy has published four bestselling series (including Gossip Girl); it's also delivered bestselling series for HarperCollins (Pretty Little Liars) and Random House (The Sisterhood of the Traveling Pants). Despite the Opal Mehta-related bad press, Alloy's reputation in publishing remains strong.

Alloy's successes seem to stem from the fact that the company “gets” teens. “I'm sure there are other competitors, but Alloy is at the top of its game right now,” said Little, Brown editor Cindy Eagan, who has worked closely with the company on various series, including Gossip Girl, which debuted in 1999. Former Alloy employee Ben Schrank echoed that, adding that if there are any packagers going after Alloy's market share, none has made a dent. “People have tried to replicate their model, but no one has been able to make a go of it.”

So what is that model? If there's a secret to the company's success, Morgenstein insists it's talent. With 10 employees in New York and two in Los Angeles, Alloy packages about 40 books annually. On Gossip Girl the idea was born in-house, assigned to a writer—series author Cecily Von Ziegesar was an Alloy staffer but this isn't usually the case—and then sold to Little, Brown. But, as Alloy has become more established, publishers have also come knocking. Kate Brian's series Private came about after S&S approached the packager, as did Scholastic's Summer Boys by Hailey Abbott.

Morgenstein, who said the Gossip Girl TV series put Alloy “on the map in a different way,” is hoping that film and TV execs start approaching the company to develop entertainment properties, in much the same way publishers come in search of bestselling book series.

Even without Hollywood execs at the company's doors, Alloy has made significant headway in the entertainment world. Much of that is due to Morgenstein, who paid close attention to what the TV execs did on the set of Roswell, an Alloy book series that had a three-year run on The WB circa 1999. Through the experience, Morgenstein gathered enough know-how and connections to set up Alloy properties on his own.

So are there any disadvantages to working with a packager? Eagan—who also works with Alloy on The Clique, The A-List and a forthcoming series called Poseur—said she thinks of Alloy staffers as “co-workers who don't work in my building.” The only bother, Eagan said, is occasionally having to work things on out on conference calls. “Sometimes when we're having brainstorming meetings over the phone it would be easier if everyone was in the same room together.”

Schrank agreed that there aren't many cons to editorial outsourcing. Although packagers might be “less deeply moved by deadlines than writers,” he said Alloy brings something more important to the table: “an additional measure of conceptual strength, relentlessness and drive.”

Speaking to the controversy surrounding Opal, Morgenstein said it had an “emotional effect” on the staff but “did not impact business.” One thing the scandal did do was turn the consumer press onto the industry practice of book packaging, which led to questions about ethics and artistry. (In a New York Times article, book packaging was referred to as “assembly-line production.”) But few publishers blamed Alloy for what had happened; that same Times piece noted that Alloy's authors are largely held to the same standards as those writing a book for a traditional house.