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Discussed in today’s email: David Zaslav, Adam Aron, Helen Hoehne, Seth Oster, Nancy Utley, Tom Rothman, Ari Emanuel, Thomas Tull, and the fall of Rome.
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Will everyone just pretend the Globes don’t exist? Tonight’s untelevised, unglamorous, un-dignified Golden Globe Awards carries at least one silver lining for the Hollywood Foreign Press Association and its producing partner, MRC: They ultimately probably won’t lose money on it.
NBC usually pays MRC (formerly Dick Clark Productions) around $60 million to air the Globes, which the producer splits with the H.F.P.A. That’s not happening this year, thanks to NBC yanking the show off the air amid the H.F.P.A.’s diversity and ethics scandal. Regular readers will remember that I noted awhile back that MRC wanted to be paid anyway, arguing that NBC unilaterally canceled the 2022 Globes before giving MRC a chance to fix any problems. NBC said no way, claiming that MRC, thanks to the talent boycott, was unable to deliver a show on par with previous years—as required by the contract—thus there’s no obligation to pay the hefty license fee.
Who’s right? Both, maybe. According to a well-placed source, the dispute has been resolved with no money changing hands for this year’s untelevised show, and NBC has agreed to add a year to the contract to televise the Globes. That eight-year deal, which began with the 2019 show, will now be extended to 2027. So MRC and the H.F.P.A. will have a chance to make up this year’s lost revenue on the back end of the contract.
That’s if there’s a Globes in 2027. Or 2023. All of this is premised on the ability to revive the telecast after a year off the air and the ongoing publicist-led boycott. MRC and the H.F.P.A. declined to comment on the deal. An NBC rep says, “We don’t comment on the terms of our contracts.”
Which leads me to…
Quote of the Week “For the box office—when there was a fully functioning box office—those award shows were everything. The recognition there became the reason to go see a smaller movie. How do you do that in the current climate? It’s hard.”
–Nancy Utley, the former co-chairman of Fox Searchlight, lamenting the demise of the Golden Globes and Covid-impacted awards shows.
A little more on this…
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News and Notes, Sunday Edition
We talked about the legacy of Project Popcorn, the future of non-franchise films, Discovery acquisition details, and an update on his next moves. You probably noticed WarnerMedia C.E.O. Jason Kilar doing a bit of a victory lap this week. AT&T revealed on Wednesday that HBO and HBO Max hit 73.8 million subscribers worldwide in 2021, beating the company’s 70-73 million target. AT&T didn’t detail the linear vs. digital split, or the U.S. vs. overseas breakdown, so it’s not totally possible to gauge the impact of “Project Popcorn,” Kilar’s controversial experiment of dropping Warners’ 2021 movies on HBO Max in the U.S. on the same the day that they were appeared in theaters. And who knows how many Max subs will churn when consumers realize that they aren’t getting exclusives, like Matrix and Dune, in 2022? Still, in a year HBO Max has gone from streaming also-ran to serious player.
Jason offered to chat with me about the numbers, but he made the media rounds, so I figured I’d wait until after his other interviews posted to hopefully ask what wasn’t asked. We talked later in the week about the legacy of Project Popcorn, an update on WarnerMedia’s spinoff to Discovery, the CW sale, whether he’ll push The Batman due to Covid, and what he might do next after the spinoff closes (spoiler: he wouldn’t tell me). I trimmed and edited this for space and clarity.
Matt Belloni: I was among the critics of Project Popcorn, and I still have questions about it. But it’s clear that you did what you set out to do you: Raise HBO Max subs, beat the number, survive the pandemic. Are you doing a victory lap now?
Jason Kilar: It’s trying to provide context for the numbers. We took understandable heat from a number of people. But it’s hard to argue; we made the right decision. We served the customers, the fans. We partnered with theaters; we were the only ones to provide 18 theatrical features with full marketing spends and full global theatrical releases. And we worked with our [talent] participants to make sure they were taken care of.
But let’s look at the tradeoff. Hundreds of millions of dollars in payments to participants; Warner Bros. had zero movies in the top 10 at the domestic box office; angry talent. You did provide product for theaters, but if you look at what happened over the holidays to films like King Richard and The Matrix Resurrections, they were busts. Do you at least acknowledge that value has been drained from other parts of the company to support your strategy?
That’s too simple of a statement, Matt. Look at West Side Story. Tremendous film that had an exclusive global theatrical release, and that film would have performed differently a decade ago. [It has grossed only $53 million worldwide.] Your analysis is missing a lot about the kinds of films that pull people into theaters in 2021.
Sure, of course, non-franchise films have been devastated by Covid. But presumably Matrix would have been a lure, at least with bigger numbers than we saw. [It has grossed $124.5 million worldwide.] Matrix is not Marvel, but did you at least look at those Spider-Man grosses and think, You know what, that would have been nice.
Take a look [at Matrix grosses] outside the U.S., it’s a bit of an A-B test. [The film is at $34.3 million domestic and $90.2 million international.] There’s 190 worldwide markets for theatrical distribution, one of which had a 31 day window on HBO Max. Just the U.S. market. In every other market, titles were released exclusively in theaters. Take a look at how these films did outside the U.S. and compare to the U.S.
You’ve committed to a 45-day theatrical window for 2022, but so far there are only 10 films slated for a theatrical release. I imagine there will ultimately be far fewer than the 18 that you put in theaters in 2021.
What you’re seeing is a smaller number of bigger films in theaters. If you look at our [theatrical] slate, it does reflect what consumers are responding to in terms of going out and seeing on the big screen or IMAX screen. Black Adam, Aquaman 2, Flash, Fantastic Beasts: Secrets of Dumbledore, The Batman—these are larger-than-life stories. That’s what you’re seeing from us, and really anyone in the theatrical storytelling business.
But everything else? Going forward, movies like King Richard, In the Heights—they wouldn’t even get theatrical if they came out in 2022, right?
We’re thinking about things at greenlight. And we’re greenlighting a lot of motion pictures. We’re saying, “Is this a story that we think can do well in theaters?” For some, yes. But others—romantic comedies, dramas, others—those are more challenging. That’s not a blanket statement, but it’s certainly happening more in 2022 than in, say, 2012.
Given that Sony delayed Morbius from January to April, have you discussed pushing The Batman from March?
We’re certainly paying attention to everything going on with Omicron. We feel good about the date right now. We’re gonna watch it day by day.
The CW network, which is half owned by Warner, is up for sale. I’m curious if you agree with the thinking that all the media companies should sell, or spin off their broadcast networks, to focus on streaming. Like when the Murdochs spun off their low-growth print assets into News Corp. so that Fox wouldn’t be dragged down.
That’s really a financial engineering question, and it’s a question of an organization’s ability to execute across many different businesses. When you spin something out, there’s a certain valuation. Sometimes that can be favorable or unfavorable. Is it a good thing for shareholders or not? Simple numbers. On the second point, our company does quite well with executing across different businesses.
But it can drag down the stock when you want to focus on growth businesses.
The market goes through different phases. There’s the Everything must be pure play phase, and then there’s the Gosh, diversification is really good phase. So it depends. If you look at where Netflix is going—introducing mobile games, consumer products—they’re attempting to diversify their business. I think that’s smart. We happen to have a very diversified business.
How much influence do you have with the Discovery people? Like who is staying and going, for instance. I know you’re not allowed to discuss non-public information, but you have opinions, and I’m sure David Zaslav and his team want to hear some of them.
There’s two phases here. One where we are very limited on what we can say. Then as you get closer, those conversations do happen. Hey what do you think? That’s a natural part of a transaction like this.
Is it already happening?
No, but it will happen soon. David is making those decisions ultimately.
Do you think the HBO Max name will go away?
I don’t think so, but that’s a future question as opposed to a current question.
Not your problem, I get it. CNN+ is the third attempt at a CNN digital product. What will make this one a success?
I believe the most important aspect of CNN+ is the business model. A paid model. A very important piece of why HBO Max is very successful is it’s a paid model, with a recurring relationship [with customers]. More important than that is the actual product of CNN+. It’s arguably the most valuable news brand and franchise in the world. Do I think the world will respond to the most valuable news brand in the world with a paid, conveniently accessible service? I think the answer is yes.
You’re expected to leave the company when the spinoff closes. What do you want to do next?
Matt, I promise to call you first when…
Oh, stop. I think we’re done.
I promise!
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My Reading List
The Feedback Tons of reactions to my Thursday email on how ViacomCBS’ Yellowstone ended up on Comcast’s Peacock. A selection:
“I have never related to anything more than your struggle to figure out how to watch Yellowstone. The behind the scenes story is better than anything on the show!” –An executive
“You correctly described the greed and dysfunction at the center of all this. All the Viacom people wanted was to get the most $$ for Yellowstone and South Park before the merger happened and they lost control. There are many other examples if you dig in. I’m sure their bonuses were great that year, but you can’t put a number on the damage done to the company.” –A former CBS executive
“Love the Yellowstone rant. Don’t love that all these Harvey Weinstein cronies are getting rich.” –A lawyer
“I can just tell you what happens on Yellowstone.” –A writer
And finally…
Some late feedback on Adam Aron, my Villain of the Year….
“I didn't know anything about Adam Aron's time at AMC, but like several million other Philadelphians, I'm still pissed at him for ruining the 76ers during his two years running the team. Excited to hear he is equally as useless in other industries!” —A student
Have a great week, Matt
Correction: I misspelled the name of the Russo brothers’ company on Thursday. It’s AGBO, not ABGO. I imagine I am not the first person to make that mistake.
Got a question, comment, complaint, or outrageous boast? Email me at Matt@puck.news or call/text me at 310-804-3198.
FOUR STORIES WE'RE TALKING ABOUT 
'Yellowstone' could have been one of the biggest success stories of the streaming age. Here’s what actually happened. MATTHEW BELLONI 
Notes on the president’s 2024 thinking, the Kamala curse, and the limitations of the Youngkin-McCormick MAGA playbook. PETER HAMBY 
Ben Smith and Justin Smith had been quietly discussing their new media ambitions, on and off, for years. Here's what they had to say. DYLAN BYERS 
The epic story of how a crafty bond salesman took over Bear Stearns—and risked an apocalypse to fight for it. WILLIAM D. COHAN 
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