March 3, 2022 on HBO Max.
"Cheap money and the digital revolution have helped debt-fueled innovators like Netflix upend the studio oligopoly of film and TV distribution. The incumbents have finally responded with their own digital platforms that, like the upstarts, must constantly be fed expensive new content. There’s a war not just for supremacy but for survival, and two major tech players—Apple and Amazon—have decided, for some reason, that they should be combatants in this war, even though they really don’t need to be. Add in the investment in entertainment by private equity firms like Blackstone, Silver Lake, and Apollo; the fact that the linear TV business, while shrinking, is still far from dead yet; and those teetering movie theaters, which are so challenged by shifting consumer habits that they are demanding more expensive product to lure people off their couches, and you have a perfect storm of cash, desperation, and the messy transition from one era of entertainment to another. “People don’t realize that these are the good old days,” I said to the lawyer.
This will all end at some point, or at least scale back dramatically. And perhaps soon, given Wall Street’s recent interest in business fundamentals, and leaders like incoming Warner Bros. Discovery C.E.O. David Zaslav saying things like, “Our goal is to compete with the leading streaming services, not to win the spending war.” As the new digital oligopoly establishes itself, the also-rans will either be consolidated or fall away.
That’s the scary future, and the lawyer and I agreed that no one really knows what the impact on creative people will be when that happens. But until then, it’s the Roaring ‘20s, where Disney will spend $33 billion this year, according to Wells Fargo analysts, where Paramount Global (née ViacomCBS) is still pretending it can compete with Disney, and where the talent community seems to have decided that taking huge sums of money up front is preferable to fighting to save the back-end compensation system that defined the linear era. As a result, the total amount spent on content worldwide this year will hit a record $230 billion, according to Ampere. That’s including sports rights, of course, but ten years ago, the spend was about half that.
It’s now totally normal when Apple—a hardware company—snatches a $200 million Brad Pitt film package from rival bidders, or throws a $40 million check at George Clooney. Given the market, NBC Universal was forced to commit $400 million—without a single script—to three films based on The Exorcist, which came out 50 years ago. When Netflix stole the two Knives Out sequels from Lionsgate with nearly half a billion dollars, it meant that Daniel Craig will likely make more money from his work in a small-budget mystery series than from playing James Bond. The pressure is on the platforms to compete, and compete now, and, in the aggregate, at least, the talent community is reaping the benefit."
"Under new chief Chris Licht, CNN will dial down the prime-time partisanship and double down on the network's news-gathering muscle, top sources tell me."