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Speaker 1: Welcome to Daily Variety, your daily dose of news and

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Speaker 1: analysis for entertainment industry insiders. It's Tuesday, December ninth, twenty

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Speaker 1: twenty five. I'm your host, Cynthia Lyttleton. I am co

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Speaker 1: editor in chief of Variety alongside Ramin Setuda. I'm in

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Speaker 1: LA He's in New York, and Righty has reporters around

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Speaker 1: the world covering the business of entertainment. In today's episode,

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Speaker 1: we'll hear from Variety's Gene Modis on the opposition in

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Speaker 1: the entertainment industry that is assembled to fight Netflix's proposed

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Speaker 1: acquisition of Warner Brothers and HBO, and Alex Ritman reports

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Speaker 1: on the scene at the Red Sea Film Festival in Jedda,

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Speaker 1: Saudi Arabia. But before we get to that, here are

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Speaker 1: a few headlines just in this morning that you need

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Speaker 1: to know. Chanelle Jones has been named co host with

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Speaker 1: Jenna bush Hager of the ten AM hour of The

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Speaker 1: Today Show. My colleague Brian Steinberg has the scoop. Matt

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Speaker 1: Gutman is Barie Weiss's first hire at CBS News. The

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Speaker 1: ABC News alum will be lead correspondent for forty eight hours,

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Speaker 1: and he'll contribute to other CBS News programs, including sixty Minutes.

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Speaker 1: Gutman had been with ABC News since two thousand and eight.

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Speaker 1: Jimmy Kimmel has linked a one year extension of his

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Speaker 1: deal to host Jimmy Kimmelive for ABC. That's good news,

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Speaker 1: but the one year term seems notable. The EU has

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Speaker 1: launched an antitrust probe of Google's use of content to

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Speaker 1: train AI models. The investigation will also examine whether Google

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Speaker 1: is violating competition rules by quote imposing unfair terms and

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Speaker 1: conditions on publishers and content creators end quote. All of

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Speaker 1: these stories and so much more can be found on

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Speaker 1: Variety Dot Right now now it's time for conversations with

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Speaker 1: Friday journalists about news and trends in show business. Gene Mattis,

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Speaker 1: Fidy's senior media writer, discusses the opposition that is forming

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Speaker 1: in the entertainment industry to block Netflix's acquisition of Warner Brothers.

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Speaker 1: There's an HBO. The eighty two billion dollar deal unveiled

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Speaker 1: last week by the streaming giant has different industry constituencies

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Speaker 1: up in arms. There's also concern about the prospect of

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Speaker 1: Paramount's guidance absorbing Warner Brothers. In HBO if David Ellison

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Speaker 1: is successful in his counterattack mission, Jane Matis, thank you

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Speaker 1: for joining me.

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Speaker 2: Happy to do it.

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Speaker 1: With David Ellison making his stand to try to pray

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Speaker 1: Warner Brothers on HBO out of the arms of Netflix,

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Speaker 1: the corporate drama never stops. But I wanted to talk

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Speaker 1: to you specifically about the opposition that came together with

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Speaker 1: lightning speed even before the deal was formally announced. There

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Speaker 1: are a bunch of different industry constituencies that are very

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Speaker 1: worked up about the potential of this deal, whether it

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Speaker 1: be to Netflix or paramount. Unions have had a range

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Speaker 1: of responses to this, from the DGA saying we really

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Speaker 1: need to study this and meet with them, to the

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Speaker 1: Writers Guild of America coming up flat out and declaring

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Speaker 1: that this merger must be blocked. Gene. My question for

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Speaker 1: you is who out there do you think can put

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Speaker 1: up enough roadblocks or at least elongate the regulatory review

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Speaker 1: process here.

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Speaker 2: I think obviously President Trump is the number one obstacle

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Speaker 2: to a potential deal. We've seen his ability to get

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Speaker 2: in the middle of these things before. But setting that aside,

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Speaker 2: obviously all the labor groups are very concerned about fewer

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Speaker 2: buyers for their services bottom line, and they are going

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Speaker 2: to be loud about it, and they are being loud

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Speaker 2: about it in a way that I don't think they

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Speaker 2: have been on a recent merger, certainly not since Disney Fox,

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Speaker 2: and maybe not even with Disney Fox. Given the state

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Speaker 2: of the industry where things have been, honestly the last

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Speaker 2: five years, people are sort of at the end of

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Speaker 2: their rope already, and then this comes along and is

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Speaker 2: just one more thing on top of it, and it

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Speaker 2: just feels like there's only going to be two or

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Speaker 2: three places you can take your pitch to anymore. And

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Speaker 2: that is the thing that people are most afraid of,

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Speaker 2: is they just won't have any leverage in these negotiations

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Speaker 2: and that the old days are basically done and dusted.

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Speaker 1: If you actually look at the viewing share numbers, of

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Speaker 1: course YouTube is really the big kahuna and Disney is

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Speaker 1: close behind. But in the public perception numbers, what entity

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Speaker 1: has come and become more of a force and more

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Speaker 1: on everybody's lips than Netflix. In a way, Netflix's success

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Speaker 1: is going to be something they have to overcome here

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Speaker 1: in the sense that people think that they are just

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Speaker 1: so dominant that this would be an utter monopoly.

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Speaker 2: We've seen over the last ten fifteen years, streaming has

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Speaker 2: become the inevitable future over that period, and people have

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Speaker 2: a lot of grievances and complaints about that, and we

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Speaker 2: work through all of that during the twenty twenty three strike.

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Speaker 2: But I think this makes it pretty clear if it

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Speaker 2: wasn't already that streaming is here, it is not going anywhere,

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Speaker 2: and it is not the future. It's the present, and

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Speaker 2: the old model is really in the review mirror.

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Speaker 1: One of Netflix's biggest disruptions behind the scenes has been

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Speaker 1: in the compensation proto calls for key talent actors, writers, directors, producers.

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Speaker 1: Hollywood went from a back end business where you really

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Speaker 1: played for back end points and boy, in success, those

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Speaker 1: points would be an annuity that will support your grandchildren,

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Speaker 1: to an upfront business where in demand talent can get

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Speaker 1: very big upfront checks, but not that back end participation

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Speaker 1: that leads to the kind of annuity that pays off

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Speaker 1: for decades. So there's definitely been a trade off and

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Speaker 1: that whole shift, which has really taken root over about

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Speaker 1: a decade. It was one of the emotional issues that

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Speaker 1: fueled the strike. If Netflix buys Warner Brothers. Is it

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Speaker 1: game over? Is that now just enshrined as that's going

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Speaker 1: to be permanent in the industry. Is that what you're

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Speaker 1: getting as you talk to union people.

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Speaker 2: Yeah, I mean is the merger a cause of that

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Speaker 2: or a consequence sort of far downstream? And we've had

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Speaker 2: that that debate and we ended up where we ended up.

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Speaker 2: That was what the strike was about. They got a

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Speaker 2: success bonus out of that. It's mente mimic the old

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Speaker 2: formula of you know, you get paid in success, but

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Speaker 2: obviously is a pale shadow in a real way.

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Speaker 1: Oh.

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Speaker 2: Just fundamentally, the technology of streaming is very, very different

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Speaker 2: from the technology of syndication or broadcast or theatrical or

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Speaker 2: anything else. And so there's no such thing as a

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Speaker 2: rerun anymore, and you don't get paid for each rerun.

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Speaker 2: And that's just a technological development that's been great for

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Speaker 2: consumers and not great for profit participants.

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Speaker 1: The three major guilds that we've heard from, the Writer's

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Speaker 1: Guild of America has come down with block this at

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Speaker 1: all costs. Sag AFTER has raised some concerns, but hasn't

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Speaker 1: been quite as strenuous the DGA. In typical DJA Fashion

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Speaker 1: wants to study things and have meetings, which good for them.

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Speaker 1: That's a diplomatic approach. Do you think anybody here has

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Speaker 1: the ability to really throw up significant roadblocks to this deal?

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Speaker 2: And the team's just they are also against it, and

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Speaker 2: the producer skilled is also Yeah, it is a pretty

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Speaker 2: broad community that's opposed at this point. Honestly, I do

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Speaker 2: think they have an opportunity to influence the conversation. And

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Speaker 2: this will be reviewed by the Department of Justice and

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Speaker 2: by the FTC, but also by state training generals around

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Speaker 2: the country. And the more noise you can kick up,

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Speaker 2: the more opposition there is, the more political pressure is

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Speaker 2: brought to bear on political leaders around the country, not

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Speaker 2: just in the White House, but attorney generals and that

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Speaker 2: sort of thing. Potentially, they could create real headaches for

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Speaker 2: Netflix on this.

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Speaker 1: Let me ask you about theater owners. Do you think exhibition,

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Speaker 1: which has been a very challenged sector, do you think

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Speaker 1: they have the pull to really get much attention here.

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Speaker 1: They are saying that if Netflix does is it will

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Speaker 1: hasten the end of movie going.

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Speaker 2: You know, all of the studios have been involving the

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Speaker 2: windows for some time and the question is is that

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Speaker 2: enough to create an anti trust problem if you have

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Speaker 2: a two week window and then put something on the

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Speaker 2: NETFLI platform, Like, is that so different really than what's

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Speaker 2: the trend that's already been underway for the last five

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Speaker 2: six years. That one is obviously much more of a

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Speaker 2: focus on a Netflix question, and Netflix, obviously I've also

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Speaker 2: said that they will keep making Warner Brothers movies and

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Speaker 2: keep releasing them. Theatrically, I feel like there's probably less

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Speaker 2: leverage on that one than there is from the labor perspective.

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Speaker 1: I know you've talked to some anti trust experts. What

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Speaker 1: are you hearing on the Netflix versus paramount? What would

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Speaker 1: be worse for the marketplace in terms of that consolidation.

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Speaker 2: The focus from the anti trust perspective is primarily, at

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Speaker 2: least in the conversation, been about the two streaming services combining.

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Speaker 2: So you have, depending on how you look at it,

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Speaker 2: either the number one or the number two streaming service

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Speaker 2: combining with another very significant streaming service in NHBO Max.

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Speaker 2: And that's, you know, a classic horizontal merger that you know,

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Speaker 2: depending on how you look at the numbers, could be

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Speaker 2: getting up into this threshold of thirty percent is a

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Speaker 2: very important threshold and anti trust, and if you start

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Speaker 2: to claim that amount of market share, it sort of

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Speaker 2: becomes presumptively anti competitive, and that's when people really start

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Speaker 2: to take a very serious look at it.

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Speaker 1: Now.

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Speaker 2: Obviously, Netflix has an argument that you know, if you

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Speaker 2: count everything that anybody watches, including you know, looking at

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Speaker 2: their phone and TikTok, then it's a much smaller percentage

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Speaker 2: of the total market. But I think the narrower you

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Speaker 2: examine it that the SVOD marketplace, the greater share that

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Speaker 2: the combined Netflix HBO is going to have is certainly

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Speaker 2: compared to any of its competitors. And so that's the

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Speaker 2: most obvious like anti trust concern. But from a labor standpoint,

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Speaker 2: they don't want either of these deals, honestly. They would

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Speaker 2: want Warner Brothers to continue to be an independent company.

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Speaker 2: And it's just a question of, you know, is that

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Speaker 2: really a realistic option at this point. But there's a

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Speaker 2: whole political component to this as well, and are you

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Speaker 2: and Donald Trump's good graces or not is a whole

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Speaker 2: other factor that has to be analyzed realistically.

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Speaker 1: Let me ask you for political figures not named Trump.

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Speaker 1: Is there anybody out there you think could also be

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Speaker 1: a real thorn in their side beyond just issuing statements.

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Speaker 2: We saw Elizabeth Warren, obviously she was going to be

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Speaker 2: against it no matter what. But you also saw Mike Lee,

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Speaker 2: who's a Republican from Utah, somebody like Josh Holly. There's

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Speaker 2: a whole wing of the Republican Party that is very

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Speaker 2: skeptical of big tech, just big companies in general. But

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Speaker 2: there's definitely a bipartisan sense of concern about this sort

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Speaker 2: of thing.

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Speaker 1: I think the only certainty is that there will be

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Speaker 1: more political theater around this to come, both in Washington

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Speaker 1: in Hollywood. Gene, thank you for rolling up your sleeve.

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Speaker 1: Really appreciate it.

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Speaker 2: Yep, thanks, happy to do it.

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Speaker 1: And now we turned to Alex Ritman, Variety's London bureau chief.

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Speaker 1: He's in Jetta, Saudi Arabia to cover the Red Sea

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Speaker 1: Film Festival. We talk about the scene that this budding

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Speaker 1: event that has had resources poured into it by the

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Speaker 1: Saudi Kingdom. We talk about why that is why the

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Speaker 1: country is looking to build up its media and arts sector,

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Speaker 1: and we talk about how all of that inevitably collides

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Speaker 1: with the traditional tensions between Western culture and attitudes and

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Speaker 1: those of the Kingdom as we've seen in protests and

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Speaker 1: backlash that has emerged to talent who participated in the

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Speaker 1: Riod Comedy Festival just a few weeks ago. Alex Ritman

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Speaker 1: are a London bureau chief joining me from Jetta, Saudi Arabia.

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Speaker 1: How are you doing there at the Red Sea International

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Speaker 1: Film Festival.

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Speaker 3: I'm doing very well, Thanks Cynthia. It's generally been very impressive.

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Speaker 1: Well, Alex, I know you are a veteran of this advantage,

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Speaker 1: so we can really get some perspective from you. But

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Speaker 1: tell me what's been the talk of the town this year.

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Speaker 1: Obviously there's a whole lot going on in the entertainment business.

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Speaker 1: Curious what folks that are attending there are lezzing about you.

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Speaker 3: As you said, it's only five years old. I think

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Speaker 3: it's the biggest the festival's been so far. It's big,

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Speaker 3: it's buzzy. There's plenty of things going on, plenty of

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Speaker 3: films being shown, lots and lots of people here, are

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Speaker 3: very steady stream of big name talent, a lot of

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Speaker 3: Hollywood names that have been coming through. There's a huge

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Speaker 3: cultural center that is now home to the premieres and

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Speaker 3: the opening night party, getch.

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Speaker 1: The scene for us, give us a sense of how

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Speaker 1: it plays out over the four days.

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Speaker 3: So there's this huge area called the Cultural Square and

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Speaker 3: this vast cinema complex that's been built there. But it's

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Speaker 3: not like it's steel and glass glittering affair. It's very

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Speaker 3: much in tune with local Arabic style. The first two

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Speaker 3: years I was here, everything was being held in the

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Speaker 3: Ritz Carlton Hotel was this exceptionally shiny and glitzy and

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Speaker 3: slightly overbearing venue. But now it's in its own purpose

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Speaker 3: built location. It's there's huge auditorium for the main premires,

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Speaker 3: but also lots of other screens and they're having screenings

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Speaker 3: throughout the day into the evening. There's a mass, huge

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Speaker 3: area for the red carpet. I mean, look, this is

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Speaker 3: what you can achieve when you have a lot of

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Speaker 3: money at it disposal.

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Speaker 1: Is there any kind of marketplace involved? Is there any

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Speaker 1: buying and selling going on?

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Speaker 3: Yeah? There is. They have a huge area called the Soup,

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Speaker 3: which is a short buggy away from the Cultural Center

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Speaker 3: and or a walk. It can get a bit sweaty

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Speaker 3: in the day if you want to risk that, but

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Speaker 3: that's also absolutely huge and that's where they've got the

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Speaker 3: press conferences and the talks in conversations. That's where Variety.

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Speaker 3: We've got our studio. So people are coming through there.

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Speaker 3: There's lots of local companies, lots of international companies that

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Speaker 3: are coming through. I hear lots of big sex from

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Speaker 3: the US have come over. I know Netflix and Disney

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Speaker 3: have sent people to town. So yes, that's another side

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Speaker 3: to it.

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Speaker 1: You mentioned. Of course, this is what you can do

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Speaker 1: when you have a lot of money, and certainly the Kingdom,

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Speaker 1: the Saudi Kingdom has very vocally and demonstrably been pouring

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Speaker 1: money into building arts and culture and media. They've been

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Speaker 1: very explicit as part of this larger Saudi twenty thirty vision,

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Speaker 1: very explicit about saying that they feel like they need

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Speaker 1: a stronger cultural and media sector as part of their

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Speaker 1: larger evergence on the world stage. Part and parcel of

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Speaker 1: that is an opening of a society that had been

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Speaker 1: much more conservative and from a Western perspective, very discriminatory,

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Speaker 1: and that really within the blink of an eye since

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Speaker 1: twenty seventeen twenty eighteen, there's been a great opening of

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Speaker 1: this society. And so when you're there, do you literally

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Speaker 1: feel the winds of change around you.

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Speaker 3: Yeah. Absolutely. Let's not forget cinemas only reopened here in

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Speaker 3: was it twenty eighteen? So what we're seven years on

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Speaker 3: from that. So the change has been phenomenal. And it's

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Speaker 3: not just me being a scenic but you could suggest

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Speaker 3: that this is a very expensive culture washing event. Think

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Speaker 3: that's an elephant in the room that you perhaps don't ignore.

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Speaker 3: But at the same time, there's this huge creative scene

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Speaker 3: here that has that previously was just under the surface,

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Speaker 3: and now they've been given this huge platform to come

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Speaker 3: into their own. Just last night that we had the

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Speaker 3: local premiere of this film, Desert Warrior, which is the

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Speaker 3: most expensive Saudi film you know, ever made. I think

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Speaker 3: it was like one hundred and fifty million dollars, the

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Speaker 3: biggest film to ever shoot solely in Saudi Ara. It's

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Speaker 3: a real statement of intent.

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Speaker 1: Let me ask you about the setting, because Jedda, as

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Speaker 1: I understand, is considered like the Miami Beach of Saudi Arabias.

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Speaker 3: Looks by the Red Sea. Okay went last year to

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Speaker 3: go around the Alba Lad which is like their historic

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Speaker 3: old town that they've restored, these these buildings which are

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Speaker 3: like some of them I hear are like eight hundred,

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Speaker 3: nine hundred years old, and it's absolutely delightful. You can

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Speaker 3: just walk around at night and there's little cafes here

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Speaker 3: and it's a really charming, chilled vibe, little people just

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Speaker 3: sitting having a cup of coffee. It's predominantly local. I

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Speaker 3: think a Jeda has always been considered like the cultural

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Speaker 3: capital of Saudi Arabia. Perhaps it was chosen for the

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Speaker 3: festival because it's considered a more liberal than some of

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Speaker 3: the more conservative areas, but it's always had a strong

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Speaker 3: art foundation here.

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Speaker 1: Interesting tell us about some of the names that have

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Speaker 1: been coming through the Variety studio.

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Speaker 3: We have Vin Diesel, Michael Caine, Juliette Binotto's Uma Furman

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Speaker 3: and Andy Armas, Jessica Albertico Johnson, Sean Baker, who's heading

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Speaker 3: up the jewelry here, Naomihara, Kirsten Dunst, ashwa Arai. Daniel

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Speaker 3: Kluleu was in town apparently yesterday he gave a discussion

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Speaker 3: to up and coming filmmakers behind closed doors. There's no

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Speaker 3: press there. They weren't shouting about it, so there is

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Speaker 3: lots going on behind the scenes that they aren't kind

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Speaker 3: of making a big deal about which is nice to

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Speaker 3: hear an Asian broad it's swung by the festival yesterday.

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Speaker 1: For the festival itself that there's a real emphasis on women,

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Speaker 1: female filmmakers telling female stories. And I'm going to sound

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Speaker 1: like a broken record on the film festival stage as

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Speaker 1: they're up there talking and as filmmakers are talking, how

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Speaker 1: do they balance this showcase with the historic you know,

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Speaker 1: the historic restrictions on women, what women could do in public,

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Speaker 1: what they could wear, what could they drive. It's such

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Speaker 1: a dramatic change. I can't imagine, just even within Saudi culture,

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Speaker 1: how people are dealing with it, how women are responding

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Speaker 1: to the opportunity.

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Speaker 3: They all seem absolutely overjoy that this film Festival is on.

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Speaker 3: From what it seems, they've focused very much on the future.

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Speaker 3: Right from the there's been this focus on female filmmakers,

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Speaker 3: and I think that was very purposeful. And when you

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Speaker 3: think about some of the most groundbreaking Saudi filmmakers, it's

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Speaker 3: names like Haifer Amnsor who made her film. Watched her

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Speaker 3: before cinemas could open up, and remember speaking to her

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Speaker 3: at the time, and she had to shoot the film

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Speaker 3: from the back of a van because she wasn't that

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Speaker 3: couldn't be on the street with men at the time,

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Speaker 3: and that that was what that was fifteen years ago,

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Speaker 3: and now that just seems like centuries a ghost. But

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Speaker 3: this year with Uma Thurman, Anadiyamos, Juliette Binoche and this

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Speaker 3: is the first year that Caring has brought its Women

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Speaker 3: in Motion initiative, and they had a big gala event

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Speaker 3: the other night and a panel discussion. You think that

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Speaker 3: it really does seem like they've put that that is

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Speaker 3: the central platform.

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Speaker 1: Alex, thank you for being Variety's eyes and ears in

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Speaker 1: far forward places in the world.

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Speaker 3: My pleasure. Thanks very much.

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Speaker 1: Up As we close out today's episode, here's a few

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Speaker 1: things we're watching for the film Independent Spirit Awards will

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Speaker 1: be held February fifteen that the Hollywood Palladium, Eggo Wodum

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Speaker 1: will host. Don't miss our TikTok on Paramount Spurned Courtship

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Speaker 1: of Warner Brothers Discovery back in September and October. It's

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Speaker 1: full of color about the habits and practices of moguls

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Speaker 1: and billionaires. My colleague Todd Spangler has the story up

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Speaker 1: on Variety dot com right now. We love to hear

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Speaker 1: from our listeners, so please send thoughts, scripes, and other

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Speaker 1: feedback about Daily Variety to podcasts at Variety dot com

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Speaker 1: Before we go, Congrats to pop group Katsie. They've been

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Speaker 1: named Global Artist of the Year by TikTok. Thanks for listening.

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Speaker 1: This episode was written and reported by me Cynthia Littleton,

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Speaker 1: with contributions from Gene Mattis and Alex Ritman Stick Snake's

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Speaker 1: hick Picks. Please leave us a review at the podcast

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Speaker 1: platform of your choice, and please tune in tomorrow for

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Speaker 1: another episode of Daily Variety, And don't forget to tell

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Speaker 1: us what you think at podcasts at Variety dot com.