You would think there would be some editorial oversight on a cover like this:
The red boxes were added by me. Obviously not meant to go together but still – a terrible image to go with the top headline.
Jill Kennedy – OnMedea
Hollywood Studios’ Only Chance For Long-Term Survival
GO PRIVATE.
There will never – ever – be enough growth and margin improvement to satisfy Wall Street.
Maybe short-term the studios will get a bump by telling investors they are going to make 100 comic book movies over the next 5 years – but after that flattens out – there’s nothing left to grow on top of that.
And it’s all Wall Street’s fault. You can’t blame studio executives. They have to appease Wall Street or they’re out.
I mean, my company, Manka Bros. just announced a trilogy of films based on the board game CHECKERS!
Wall Street’s insistence for high margin growth in such a mature business is destroying creativity (again, note all the sequels and re-makes and re-hashes and re-dos) and in it, ruining any realist opportunity for growth.
To grow the way Wall Street would like, 21st Century Fox (for instance) would need to have an “Avatar” one year (and double the amount of TV production); two “Avatars” the next year (and double again the doubled amount of TV shows); four “Avatars” the following year – and so on and so on. And they would all have to preform as good or better than the first!
And the market is saturated already.
There are too many choices and studios don’t have the monopoly on content creation that they once did.
And the moguls long for those days.
Sorry, fellas, they are not coming back.
It won’t be cheap to go private – billions and billions – but there is plenty of private equity out there that would love an asset that consistently pumps out up to $1 billion in pure profit.
Without the need to top profits year after year, the content produced can be more experimental, and thus, much more interesting and exciting for the consumer.
It would even allow for the occasional down year when things just didn’t work out. Hollywood IS a cyclical business, after all.
Hollywood Studios are sacred treasures in this country (and around the world) and should not be allowed to just fade away because Wall Street wasn’t happy with the growth prospects.
We must do what we can to save these institutions and going private is the best way.
Jill Kennedy – OnMedea
I Didn’t Realize ‘Community’ Fans Were Such Dorks
The internet is blowing up today on the news that “Community” will be exhumed and given a 15 episode Season 6 on Yahoo!’s video streaming service called Yahoo! Screen.
This, I suppose, is a big get for Yahoo! because now people have heard of Yahoo! Screen.
It’s also, obviously, a real life saver for many “Community” fans who, apparently, have been walking around the Earth like the cast of “The Leftovers” after the Rapture.
Don’t get me wrong, I consider myself a dork for many television shows and would be upset if they were cancelled but this spontaneous ejaculation of joy today is on par with the Brazilians reaction to winning the shoot-out against Chile in the World Cup.
This news also creates an interesting scenario in that most of the rabid fans that love “Community” so much hate Yahoo! equally as much.
It should be a fun experiment for Yahoo! (they have nothing to lose and a boatload of cash coming from the Alibaba IPO). And it could just be another nail in the coffin of Broadcast TV.
I just hope Dan Harmon and company are up to the task. It’s one thing to make an announcement on Twitter – it’s another thing to sit in a writer’s room and realize – “Ah, shit, we’re doing this on fucking Yahoo!”
There are insanely high expectations going into this streaming video show (it’s no longer a TV show).
Sucking could result in a mass suicide.
Jill Kennedy – OnMedea
The Twilight Of The Katzenberg
It’s going to be a long summer for Jeffrey Katzenberg and DreamWorks Animation. It may just be the last summer those two names are associated with each other.
Sure, they’ve got “How To Train Your Dragon 2” coming out. And, sure, it’ll do $500 million worldwide and make a decent profit.
But not enough to convince anyone that DWA isn’t a dead-company-walking.
By early next year, something will have to happen – maybe a sale, maybe a shutdown – but business as usual is not an option.
This failure seemed to happen in slow motion – nearly 10 years with a terrible, unsustainable business model.
I seriously doubt the Company Mission was this: “We’re going to produce two animated movies a year – and one of them will fail. Repeat. Repeat. Repeat. Repeat.”
In baseball, getting a hit fifty percent of the time would be superhuman.
In Hollywood, fifty percent sucks.
When your job is to produce animated feature films, and over half of your movies bomb, there is something wrong with you. It means, you are incompetent and, deep down, you really don’t know what you’re doing.
Big Hollywood animated feature films is the ultimate fish-in-a-barrel/low-hanging-fruit type entertainment. Kids of a certain age will see almost anything. And parents need these diversions to pass the time on a hot summer afternoon or a miserable cold winter day.
But I suppose over the half time, parents would rather be miserable than go see a DreamWorks Animation film.
I’m not saying everything has to be “Frozen” – but nothing should ever be “Turbo” or “Mr. Peabody & Sherman.”
From the beginning, I never understood the Animation unit IPO.
If the reason was just to get enough cash to pay-off Paul Allen at the expense of giving up your dream of building a giant entertainment conglomerate on par with the other majors, then that was truly short-sighted and weak.
Taking the whole company public was really the only option – a piece of it was just too small. I’m sure there was a reason – but it was mistake nonetheless.
Seriously, you went from producing content like this:
To content like this:
AwesomenessTV and OTT, in general, is not going to be enough to save the company – though it will be a nice asset for someone to pick up on the cheap – after the whole OTT bubble bursts (any moment now).
So, I’m sorry, Jeffrey, it’s time for you to just enjoy your money and your philanthropic work (cocktail parties, clambakes at Geffen’s house, etc.). You do many great things for the world – producing movies isn’t one of those things.
Sorry.
It is very possible that Khan Manka, Jr. – as he wrote himself – is the Last Hollywood Mogul.
Good luck to you.
Jill Kennedy – OnMedea
The Great Media Bloodbath of 2014
5/12/14 UPDATE: AT&T to acquire DirecTV! Lock the doors – it’s scary out there.
2/12/14 UPDATE: Holy Crap, 2014 just got a whole lot uglier (and it was already hideous) with the announcement of Comcast acquiring Time Warner Cable!
ORIGINAL POST:
It’s coming.
Holy shit is it coming.
Millions are getting pummeled with a horrible winter but brace yourselves further, because you are in for a shitstorm of job cuts in 2014.
It will not be pretty.
It seems that media company CEOs are hell bent on proving to Wall Street that their companies can be growth companies.
Unless they fire every employee and start a new company by themselves in a garage, they cannot be growth companies the way Wall Street would like.
20% margins just will never happen again in the movie, TV, print, or music industries – so deal with it.
But these CEOs are guys (all guys) who think they can do anything.
But they will fail.
And then they’ll CUT.
And… it will not be pretty.
Tribune got things started.
My company’s CEO has called 2014 “The Year of the Hammer.”
No one will make it through unscathed.
First to go will be the packaged media folks. Those who support the production and distribution of DVDs and CDs and magazines, etc.
Gone.
Next will be the slow growth businesses – like movies and Broadcast TV production (serious like a heart attack).
Slates will be slashed, storytelling risk-taking will cease to exist.
Since no one can seem to do comedy anymore on Broadcast, they will be relegated to the epic mini-series format like “Under The Dome” and live Sports to stay afloat.
Then, finally, the low margin businesses will be hit – like console games. With the exception of a few huge titles, it’s a tough business and it certainly doesn’t help these overly-ambitious / delusional CEOs hit their targets.
So what’s going to be left? TV production for cable and Over-The-Top (OTT).
Why TV gets ownership of Internet content production is baffling to me. But they do.
By the end of 2014, giant media companies with their film studios, broadcast networks and massive real estate leases will be much MUCH leaner and the quality of the product will be much MUCH worse.
Hey, but a point of margin here and a point of margin there adds up to… 2 points.
But lighten up, Spring is coming.
Jill Kennedy – OnMedea
I’m Back
The first draft of my book is finished (more on that in the coming weeks) and I am back on the job here at OnMedea.
It was an excellent summer with lots of quiet and lots of work.
Other than the entire media spectrum going to Hell in a handbasket, there really is nothing much going on.
Movie studios are imploding and on their current tract will produce fewer and fewer quality films while continuing to bore audiences around the world with sequel after sequel after sequel. Don’t the studio bosses know that the Tentpole Is Dead?!
My parent company, Manka Bros., is apparently abandoning original films altogether.
That’s one sure-fire way to kill your business (with all due respect).
Broadcast networks continue on their painfully slow journey to complete irrelevance. (Thank God for football, huh?)
I declared them dead a couple of years ago but they are still on life support – though brain dead.
Oh, yeah, and we’re about to go to war. The world is, frankly, in chaos. My colleague Lester Aldrich wrote a thoughtful piece on the prospect of going to war from his own perspective as an 88-year-old man who has been through two wars.
But I digress… happy to be back. Have a great weekend.
Jill Kennedy – OnMedea
The Emmys Are A Joke
I had to interrupt my summer hiatus (I’m working on a book so I haven’t been posting in this space for a few weeks) to say the Emmys Are A Joke.
I’m not talking about the nominations – for the most part, it’s the same actors year after year after year. TV comedy is in big trouble. The only broadcast shows nominated are getting really old. New comedy doesn’t exist on broadcast.
But that’s not at all the point I want to make it.
This is my point: “HOUSE OF CARDS” IS NOT A TELEVISION SHOW!
It is a series of webisodes.
High-quality webisodes.
It was not produced for television…
It did not air on a television network…
It is not a television show.
“House of Cards” is an internet series produced for online and mobile delivery. The last time I checked, TV shows are produced and distributed for satellite, cable and over-the-air broadcast networks.
The TV Academy can’t just cherry pick internet webisodes that it likes and call them TV shows.
And the TV Academy shouldn’t be claiming the Internet as their own – even though on their website they say: “The Television Academy, the only major organization devoted to the television and broadband screen entertainment industry…”
In reality, they have as much claim over the Internet as I do.
And it would be impossible for the guys in the TV Academy to watch all of the content produced for the Internet (so, to make it easy on themselves, they just give the nominations to Internet content that features big stars – Kevin Spacey, Jason Bateman, Zach Galifinakis, etc.).
Can you imagine these TV Academy members sitting with their iPads watching every series produced by comedy improv troupes around the freakin’ world? “Hey, did you guys see this one from some guys in Des Moines that make fun of working in an office? It’s hysterical! It should nominated for an Emmy!”
On top of that, the TV Academy refuses (because of arrogance) to even acknowledge The CW as a legitimate producer of programming (how “The Gilmore Girls” on old The WB never got a nomination is still one of the great injustices in entertainment history – and that’s no platitude) and yet they’ll throw a few nominations to Netflix to prove some kind of point. To show that the TV Academy is aware of the future and is very much on the cutting edge of content production.
But they’re not. When you think of the TV Academy – you still think it’s just a room of old white guys longing for the days of Norman Lear and the three powerful networks that everyone watched. Remember when the cable industry had to form their own pathetic award show (the Cable ACE Awards) because the TV Academy didn’t allow cable shows to be nominated?
Now, anyone can be nominated for an Emmy. Maybe I’ll produce a series of webisodes about my dog and submit it for consideration. It won’t even be looked at because my dog doesn’t look like Kevin Spacey.
You never know, maybe the TV Academy is changing with the times – and if they are – maybe they should change their name.
“The Transmedia Academy Of Arts & Sciences!”
Now THAT has a ring to it.
A couple of years ago, I wrote “Broadcast Networks: On Death And Dying” to illustrate that Broadcast Networks are in complete denial that one day they will just be another button on the grid – the master grid that gives equal weight to every type of format imaginable on our connected TVs (broadcast, cable, YouTube, Netflix, games, family videos… everything equal).
Ted Sarandos of Netflix is absolutely correct when he says: “Television is what’s on the screen – not how it gets there.”
But that doesn’t mean “House of Cards” should get an Emmy nomination.
It’s not a TV show!
Jill Kennedy – OnMedea
The Death Of The Tentpole Film
Hollywood doesn’t need to panic yet – but the powers that be should seriously start thinking about changing film slate strategies.
This is great news for filmmakers, terrible news for Hollywood’s bottom line.
Tentpole movies, when they work, print money for years and years and years – through sequels and licensing, etc. etc.
But, like what happens with obesity, if you give someone a double-quarter pounder meal with super-sized fries every once in a while – it probably won’t make you fat.
If you give someone that meal every freakin’ day for the rest of their lives – they’ll be fat and die much sooner than is necessary.
Hollywood studios have booked a tentpole movie practically every weekend for the next five years.
This is unsustainable and only a matter time before audiences yell bullshit, back away from the Big Mac and change their diet.
This is not to say that these movies are going away completely. There is always an appetite for a great event film spectacle. When they hit, it’s the greatest experience. And I hope that never goes away.
But everything can’t be a tentpole.
Yesterday, I saw the Deadline.com story on Disney’s announced animation slate (see picture).
Personally, I CANNOT WAIT for “Untitled Disney Animation Movie 2017!” And I really can’t wait for the Untitled Toy that my daughter will want.
Studios, especially on the live-action side, have no idea which movies are going to rise up from the pile to get a greenlight five years in advance.
They just know that they have to make 5-6 tentpole movies a year to hit their revenue and profit targets. You can’t make a decent budget projection if you have slated “Silver Linings Playbook 2” or the next film from Alexander Payne.
Tentpoles are necessary for financial planning. But it’s become so much of a science and so NOT much of a creative endeavor that I fear they are suffocating the goose that’s been laying the golden eggs for the past 10 years.
And, seriously, audiences just can’t take it anymore.
They aren’t crying for “Marvel Character #1,000” to finally have his or her own movie!
“Remember that character that cleaned the floors in ‘The Amazing Spider-man Comics #43’? He totally needs his own movie!”
But Hollywood thinks it can do it and that audiences will keep lapping it up.
And this summer, they will – “Man Of Steel” and “Pacific Rim” both look fantastic and I’ll be seeing them both on opening weekends with millions of others.
Again, Hollywood doesn’t need to panic yet.
I wrote a couple of years ago that audiences will never tire of super heroes – that the characters who are shoved quickly into movies should not be blamed for the failures of mortal film executives and writers to tell their stories well.
But there is only so much heavy lifting these characters can do – they’re superheroes, they’re not God.
It’s time for Hollywood to take more risks, be more experimental, have more fun. Don’t be afraid to fail.
Film production IS McDonalds these days. The food looks and tastes exactly the same every time (and, sure, there is some comfort in that). But when was the last time you heard an employee at McDonalds say their job was fun and totally creative?
Jill Kennedy – OnMedea
Aereo Will Fail
Make no mistake – there is no chance Aereo will survive longer than two or three years. That’s a best-case scenario.
Broadcast Networks are dying (it’s true) and will be dead in their current form within five years.
In five years, who is going to pay $8 a month for nothing?
Where are all those little antennas going to go once Broadcast Networks cease to exist?
What sort of business launches with this sort of insane hype that, at most, will only exist for five years?
A Barry Diller company, of course.
The only useful purpose Aereo has is that it will play a part in hastening the inevitable demise of Broadcast Networks.
That’s something, I guess.
I wrote a couple of years ago that Broadcast Networks were in denial (BROADCAST NETWORKS: ON DEATH AND DYING – April 1, 2011). That the executives were longing for the old days of The Big Five.
Now they’re just trying to survive at any cost.
New shows aren’t working. The upfronts next month will be terrible (regardless of what the networks will actually say in their trumped up press releases and over-the-top presentations).
But things aren’t completely dire.
Chase Carey has the right idea but he shouldn’t say that he’ll make FOX a cable channel as a threat to Aereo. He should make FOX a cable channel because it would be a good business decision. It’s really the ONLY business decision.
It is time for Broadcast Networks to accept that the world has changed. “The Mary Tyler Moore Show” is no longer the number one show. And new shows like “How To Live With Your Parents (For The Rest Of Your Life)” will not save you now.
Basic cable and becoming just another button on the infinite media grid of the future is the only chance ABC, CBS, MBS, NBC and FOX have to survive.
Love him or hate him (most hate him), Barry Diller has, once again, disrupted an industry in desperate need of change.
If he wasn’t so gooey I would be cheering him on.
For $20 million dollars, he is forcing a $50 billion industry to join the 21st century. Now that’s getting a bang for your buck.
Jill Kennedy – OnMedea
P.S. – Who knew Barry Diller enjoyed fishing so much? Here’s a great story of a recent fishing trip.
The Pathetic, Sleazy World Of Facebook ‘Likes’
Companies who believe that having millions of “Likes” on Facebook is important to their bottom line have it absolutely wrong.
“Liking” Coke or “Liking” The Avengers on Facebook isn’t going to make a person drink more Coke or see The Avengers more times – it just means they’re going to get nothing but product blasts for the rest of their lives.
I would argue it might actually make you drink less Coke because you’re so fucking annoyed with the relentless marketing from the Coca-Cola Company.
Social media would be incredibly valuable if companies would just leave it alone, make products people really like (not “Like”) and stay out of our faces.
People talking with each other (real people) and texting and emailing and chatting, etc. is the greatest marketing tool ever invented (and it wasn’t actually invented by anyone – save God). And companies are figuring out new and clever ways to fuck that up.
If you mention in your status that you are running out to Starbucks – there is really good chance your Picture and Status Update will appear in one of your friends News Feed as ads.
So, you are now, unwittingly, a Corporate Shill for Starbucks. Most people don’t like to be Corporate Shills. The term “Corporate Shill” is not a term of endearment. It makes your real friends hate you just a little bit more than they did before you pushed a product on them.
I did a little experiment over the past month. I decided to accept everyone who requested to be my friend on Facebook – http://www.facebook.com/jill.kennedy.5095
I had my own little circle of work colleagues and college friends (around 30) – but decided to accept all comers in the hope that I could expand the number of “Likes” on my newly-created Company page – http://www.facebook.com/MankaBros
So I accepted and sort of went begging for “Likes” as so many people do. “If you ‘Like’ my page I’ll like your ebook or Erotic Blacklight Art Page in return…'” etc. etc. etc.
This was an eye-opening and humiliating experience – I now have 768 Friends (and counting) and not many “Likes.”
But, surprise, suddenly there was pornography in my News Feed.
There was every kind of racist Poke imaginable. Scary sexually advances. (And, to be fair, a few genuinely nice people.)
But, in general, a stunning display of what’s really out there.
Not pretty.
Are these the people Coke wants to “Like” them?
The marketing world’s latest buzz phrase is “Big Data” – gathering everybody’s information. Seriously, there are people out there whose information should never be shared except with some type of law enforcement.
Personally, I can only speak for big media companies (and myself), but I can imagine it applies to every company (and person) out there – be careful what you wish for when you start your social media campaigns because once people “Like” you, they never leave you alone.
Jill Kennedy – OnMedea
P.S. – “LIKE” ME ON FACEBOOK!” – http://www.facebook.com/onmedea