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Speaker 1: Welcome to another episode of strictly business, the podcast in

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Speaker 1: which we speak with some of the brightest minds working

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Speaker 1: in the media business. Today I'm Andrew Wallenstein, with variety.

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Speaker 1: This week a special double headed edition of the pod.

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Speaker 1: That's right, we're giving you too great back to back

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Speaker 1: interviews that were recorded on September and varieties entertainment and

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Speaker 1: technology summit in Los Angeles presented by city National Bank. First,

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Speaker 1: a rare one on one with the chairman of Disney

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Speaker 1: media and entertainment distribution, Kareem Daniel. He's kept a relatively

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Speaker 1: low profile in a high visibility role at the company,

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Speaker 1: but variety co editor in chiefs Cynthia Littleton, got him

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Speaker 1: to sit down and break his silence. And after that

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Speaker 1: I spend time with an industry veteran who doesn't know

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Speaker 1: from silence, lumhouse founder Jason Bla he's not only one

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Speaker 1: of Hollywood's most successful producers, but one of its most

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Speaker 1: candid ones to boot. He and his company's new president,

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Speaker 1: Abba J Prakash, opened up about the current state of

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Speaker 1: movies and profit participation. Strictly business will be back in

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Speaker 1: just a moment. Here's Cynthia and Corene Daniel. Personally, I've

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Speaker 1: had a pretty fortunate set of diverse experiences from a

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Speaker 1: career standpoint, both, I'd say, within and without the company.

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Speaker 1: I actually started off as a computer programmer. Um, I

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Speaker 1: spent some time on Wall Street. The thing that was

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Speaker 1: always in the back of my mind was a true

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Speaker 1: passion for entertainment. Film was what I grew up on.

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Speaker 1: That was my my outletting. Ultimately I made a decision

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Speaker 1: to exit a career path and try to get into

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Speaker 1: the entertainment industry. It I went back to business school

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Speaker 1: and uh had to fight to get an internship at

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Speaker 1: at the Walt Disney Company. Actually was for Bob Chapick's

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Speaker 1: organization when he was running home entertainment, and a fortuitous meeting,

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Speaker 1: of course, Bob Pick, now the CEO of Disney. It

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Speaker 1: was fortuitous indeed. Um to actually be in a film

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Speaker 1: studio just something that I had always dreamt of and

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Speaker 1: I just didn't know my angle into it and certainly

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Speaker 1: having that opportunity it was a great summer experience. Of

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Speaker 1: course they don't have this is entertainment company, so there's

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Speaker 1: no and then we'll hire you. So I had to

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Speaker 1: kind of fight to get into Disney yet again once

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Speaker 1: I graduated and I went into corporate and ultimately I

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Speaker 1: got an opportunity to go back to the studio when

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Speaker 1: Bob became not just head of home entertainment but all

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Speaker 1: of distribution. So his responsibilities extended from theatrical to home

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Speaker 1: entertainment to television to digital and his goal was to

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Speaker 1: you harmonize across all of those platforms to optimize the

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Speaker 1: performance of the film, which sounds very familiar to what

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Speaker 1: email does today, but at that time that was pretty revolutionary.

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Speaker 1: It was. It was an early kind of a precursor

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Speaker 1: to that idea of that that this content is going

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Speaker 1: to go everywhere. It's not just going to go through

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Speaker 1: that one channel. That's exactly right. This is there's two

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Speaker 1: thousand and ten. I think the first, I know the

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Speaker 1: first picture right. It was Alison Wonderland. Was In March

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Speaker 1: and we wanted to shrink the window a bit from

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Speaker 1: four months to three. Remember. That was which was a

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Speaker 1: very big deal at the time. There's a lot of

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Speaker 1: you're gonna ruin the box office, you're going to destroy

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Speaker 1: the paradigm. We destroy the paradigm. The film did quite well,

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Speaker 1: destroyed box office records. did A billion dollars. I think

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Speaker 1: it's still a top ten release in a month of March.

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Speaker 1: So it was a precursor of what we're doing now. Frankly,

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Speaker 1: that's an interesting example. It was. It was a fantastic example. So, yes,

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Speaker 1: I've had a lot of experience at Walt Disney Company,

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Speaker 1: Film Studio Being One, but I've I was in imagineering

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Speaker 1: at the beginning of covid which I would say was

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Speaker 1: one of the most special experiences I could have, being

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Speaker 1: in one of the most creative organizations in the Walt

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Speaker 1: Disney Company, in the world, frankly, and really getting a

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Speaker 1: sense of the passion and heart that goes into creating, frankly,

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Speaker 1: things that have entertained people for fifty years and entertain

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Speaker 1: them for the next fifty and leading into D med.

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Speaker 1: I'd say that this experience gave me more insight and

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Speaker 1: preparation for this role than I would have thought, and

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Speaker 1: that I was in a creative group and another group

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Speaker 1: had the business decisions. And this is in imagineering and

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Speaker 1: you were president of operations of imagineering. So like a

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Speaker 1: big gig there and we're wrangling those imagineers. Well, imagineers,

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Speaker 1: by the way, I made so many great friends there

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Speaker 1: and learned a lot about the creative process, I truly appreciate,

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Speaker 1: but I also was able to understand what's it like

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Speaker 1: to not have control over ultimate business decisions. You fast

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Speaker 1: forward to this new organization, new we're two years old

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Speaker 1: next month, so we've been at it a little while,

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Speaker 1: where D Med Our organization, has that ultimate business authority

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Speaker 1: and then there's incredibly talented content teams that are making

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Speaker 1: things that are entertaining people all over the world. I

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Speaker 1: feel like I have a bit of understanding of what

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Speaker 1: that's like, having spent time in a creative organization without

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Speaker 1: that ultimate authority, where I know that collaboration is absolutely critical.

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Speaker 1: You can't operate a business without having a true appreciation

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Speaker 1: and connection with that creative group. So a lot of experiences,

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Speaker 1: but I try to draw on all of them in

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Speaker 1: this new role. Let me ask you in moving from

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Speaker 1: you know, consumer products and distribution, we're working with the

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Speaker 1: imagineering group. Was that? Were those sort of opportunities that

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Speaker 1: came up, or was it a strategic did you have

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Speaker 1: your eye? I want to have experience here, I want

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Speaker 1: to have experience there. I do a great job of

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Speaker 1: trying to weave together these experiences uh in a way

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Speaker 1: that makes its seem planful, and that's the art right.

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Speaker 1: It's certainly not the case, but that's that's the point.

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Speaker 1: As I said earlier, each of those experiences have yielded

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Speaker 1: something that I draw upon being in this world for

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Speaker 1: two years. It helps to understand consumer products and know

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Speaker 1: that what The Walt Disney Company does is make content

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Speaker 1: that can be uh used and and frankly shared in

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Speaker 1: different types of experiences on many different types of platforms

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Speaker 1: where there's consumer products, theme parks, Etcetera, something that the

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Speaker 1: Walt Disney Company does, we'd argue, better than anyone else

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Speaker 1: in the world. That helps that I was there. It

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Speaker 1: helps that I was in the imaginary it helps that

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Speaker 1: I was in corporate strategy and and looked at at

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Speaker 1: the entire company and totality to try to determine, to

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Speaker 1: try to help determine, frankly, how we can operate better together,

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Speaker 1: and I think that's that's what we do. It's it's

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Speaker 1: even now, over the last couple of years you've heard

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Speaker 1: a lot of obviously a lot of focus being on streaming.

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Speaker 1: We have a lot of focus on streaming. We're very

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Speaker 1: pleased with our progress there. But of course we're not

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Speaker 1: just a streaming company, just like we're not just a

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Speaker 1: theme parts company or not just a consumer products company.

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Speaker 1: We may be the best in the world at many

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Speaker 1: of these areas, but it's The Walt Disney Company and

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Speaker 1: we pull them together in a way that I'd say

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Speaker 1: it's greater than the some of the parts. And having

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Speaker 1: been in so many different places at the company, I

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Speaker 1: can see how will we do that and collaborate, and

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Speaker 1: I could also see the opportunities to do more, which

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Speaker 1: I think now that we have two business units with

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Speaker 1: parks and experiences called D pat and then, of course,

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Speaker 1: me entertainment with DEMD, we're able to do that in

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Speaker 1: a much more fluid way and Disney plus, frankly, is

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Speaker 1: going to be key for that going forward. Let me

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Speaker 1: ask you. So, as you know, as most people know,

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Speaker 1: big transition at Disney in February Bob Cha peck took

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Speaker 1: over from as a CEO from Bob Eiger. Of course,

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Speaker 1: we know what happened the next month in little you know,

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Speaker 1: quite quite a fraud time. At some point, I'm guessing

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Speaker 1: in the late summer fall, you got a call from

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Speaker 1: Bob Sai and said Kareema, have a job for you.

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Speaker 1: When you talk about how how you the discussions that

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Speaker 1: led you to your the German posted at demon sure or.

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Speaker 1: First I have to acknowledge your point, though, with regard

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Speaker 1: to d twenty three, it's just a moment to sit

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Speaker 1: back and just be amazed at the creative talent at

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Speaker 1: this company. The breath is insane. And when you look

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Speaker 1: at Avatar, the way the water, as you said, we

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Speaker 1: have water, but we also have Black Panther Waconda forever,

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Speaker 1: two of the most highly anticipated features this year, if

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Speaker 1: not ever, coming out. And you look at what we

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Speaker 1: just dropped with Little Mermaid and essentially breaking the Internet

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Speaker 1: with it's just so touching and sweet the reaction there.

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Speaker 1: Tonight we've got and or premier. It's just so much

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Speaker 1: happening right now that it gives you a moment of respite.

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Speaker 1: Of Okay, we certainly have the most amazing content and

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Speaker 1: that makes our jobs that much easier. So I have

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Speaker 1: to acknowledge that. I'm glad you brought it up. But

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Speaker 1: when it comes to the creation of disposition, I think

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Speaker 1: ultimately the way we've thought about it is there's excellent

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Speaker 1: in making there's excellent and actual more of the business

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Speaker 1: and and running the P and l aspects of that

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Speaker 1: that can be separate and we've done that to success elsewhere.

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Speaker 1: As I mentioned imagineering, and when it comes down to

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Speaker 1: a Dema has two responsibilities. Fundamentally, it's looking at content

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Speaker 1: investment and it's looking at distribution strategies. And it isn't

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Speaker 1: a situation where, and I know it's it's been, it's

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Speaker 1: confusing because there's so many different companies with different paradigms. Fundamentally,

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Speaker 1: for us, we are tasked with looking at each and

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Speaker 1: every platform, whether it's networks, theatrical or screaming, and determining

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Speaker 1: what growth we anticipate or we will expect of ourselves

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Speaker 1: to generate. So it isn't that content creators create something

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Speaker 1: and then we just figure out, okay, it should go

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Speaker 1: here or there. It's much more planful, it's intentional, it's

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Speaker 1: strategic the way we look at it. So, looking at

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Speaker 1: each of those platforms, whether it's networks, theatrical or streaming,

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Speaker 1: what should the investment levels be? And, based upon our

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Speaker 1: knowledge of the consumer and what's resonating, we look on

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Speaker 1: those platforms determine what types of content had best drive

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Speaker 1: that growth. We share that with our content partners and

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Speaker 1: of course they create at a level that no one

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Speaker 1: else in the world does and they generate the incredible

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Speaker 1: content that those talented groups deliver to those platforms in

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Speaker 1: a way that drives that growth. We may determine strategically

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Speaker 1: to make changes when we have to. We have a

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Speaker 1: flexible strategy. Of course, the pandemic was was a test

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Speaker 1: of dead flexibility, which we're pleased with what we learned

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Speaker 1: during that period of time. But going forward, we believe

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Speaker 1: in the theatrical market. We know what we're going to

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Speaker 1: do there with regard to continuing number one in a

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Speaker 1: global box office six years in a row. We don't

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Speaker 1: anticipate that change a game time soon. We know what

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Speaker 1: the theatrical marketplace can do creating a cultural set guys

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Speaker 1: through features that then inevitably get played out across the

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Speaker 1: entirety of Walt Disney Company, and we're very set on

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Speaker 1: how that's going to go in the future. And we're

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Speaker 1: able to do things, though, that we weren't able to

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Speaker 1: do two years ago, and I give an example. When

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Speaker 1: you think of something theatrically Thoor, love and thunder great

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Speaker 1: film comes out fantastic. Ultimately it's going to go onto

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Speaker 1: the service, meaning Disney plus. Well, you also look at

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Speaker 1: our networks group, which we manage as well, and you

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Speaker 1: look at like Fx. That has tremendous content on it,

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Speaker 1: but it also has some third party content and they

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Speaker 1: go out and they will get a film from perhaps

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Speaker 1: another studio outside of the Walt Disney Company. We saw

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Speaker 1: an opportunity to do this where Thor, love and thunder.

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Speaker 1: We have Thoor, the first three films in the Thor Franchise.

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Speaker 1: Let's take those three films that are on Disney plus

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Speaker 1: put them on F X in a way that gives

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Speaker 1: thword that much more exposure yields benefits to the theatrical

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Speaker 1: release of love and thunder, where you just get more

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Speaker 1: thor out there. We're not going to cannibalize one single

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Speaker 1: subscriber on Disney plus. In fact, across the bottom of

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Speaker 1: that screen when you're watching fx thor one, two or three,

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Speaker 1: it says the rest of store, of this and the

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Speaker 1: other two and all of the avengers are playing twenty

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Speaker 1: four seven on Disney plus. That's harmonizing our platforms in

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Speaker 1: a way. Frankly, we couldn't do in a different organizational structure.

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Speaker 1: so that really epitomizes because everybody's incentives are aligned in

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Speaker 1: the same way and and it's with one group actually

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Speaker 1: being able to make those determinations. It helps. We have

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Speaker 1: hands made sales season five coming out. We just took

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Speaker 1: hands made sales season one, episode one and we put

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Speaker 1: it on F X and we saw seasons one through

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Speaker 1: four on Hulu got a significant lift just by putting

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Speaker 1: it on f x, so it helps. We put on

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Speaker 1: LINEAR FX and it popped the prior seasons one through

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Speaker 1: four as people are seeing, Oh okay, episode one season one,

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Speaker 1: I want to see the rest of season one, two,

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Speaker 1: three four in advance of five coming out. That's just

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Speaker 1: the type of interplay that we have by actually managing

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Speaker 1: all of these platforms that it's it's truly hitting our

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Speaker 1: stride now when we're able to do strategic things like

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Speaker 1: that with tactical implementations that we're seeing resonate with consumer

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Speaker 1: and you can actually see like an airing, a linear

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Speaker 1: or airing drives people to the numbers. would be surprising

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Speaker 1: the pop that occurred on the hand to Matail Library

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Speaker 1: on Whou by airing that episode on X. that's amazing.

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Speaker 1: That's amazing. Let me ask them. So for a tough call,

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Speaker 1: for a tough decision a show. You've had a show

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Speaker 1: for two seasons. You know you've invested some in the show.

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Speaker 1: The tough call. It's sort of on the bubble, as

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Speaker 1: they used to say, about a season three renewal. WHO

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Speaker 1: MAKES THE DECISION? We can, we just were not going

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Speaker 1: to renew this. Or who makes the decision? You know what,

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Speaker 1: there's something here. This is gonna this is gonna grow.

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Speaker 1: In season four we are going to renew that. WHO

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Speaker 1: MAKES THOSE CALLS? Well, fortunately, we don't have a lot

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Speaker 1: of examples to draw up on because the constant teams

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Speaker 1: are just creating some fantastic things. We we a lot

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Speaker 1: of different UH factors in terms of whether we should

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Speaker 1: go forward or not, and a lot of that does

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Speaker 1: require faith in our content teams. Where you knew your

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Speaker 1: story arc, you know what is happening. Sometimes you'll have

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Speaker 1: a season one where you know you have to get

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Speaker 1: through certain things establishing characters and a fundamental storyline, but

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Speaker 1: you know where that's going in a second season, even

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Speaker 1: if it's not performing that well in that first season,

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Speaker 1: or as well as we would like you know what

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Speaker 1: it's going to do in the second season and it's

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Speaker 1: going to yield benefit because that library will maintain. If

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Speaker 1: we're talking to streaming service, it will be there and

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Speaker 1: that is something that we rely upon our content teams for, certainly,

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Speaker 1: but ultimately we do have responsibility to drive the growth

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Speaker 1: of these platforms and if something is not performing, then

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Speaker 1: we're going to have to make that call, um as

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Speaker 1: as tough as it maybe, that it's not working on

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Speaker 1: the service it is. We were maniacally focused, of course,

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Speaker 1: on hitting the probability that we've established as a key

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Speaker 1: goal and FY two, and we're confident we're going to

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Speaker 1: hit that. I'm guessing Christine McCarthy has a countdown clock

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Speaker 1: in her office. Absolutely Christine and I are extremely aligned

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Speaker 1: on a number of things, including get that profitability. So

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Speaker 1: if we have to make those hard decisions at times,

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Speaker 1: then we will. Is it fair to say it's a

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Speaker 1: collaborative decision? It's a it's a you, it's a you conversation,

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Speaker 1: it's a Dana wolden conversation, it's a Craig Erwick who runs,

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Speaker 1: who lose originals, it's it's a collaborative conversation. Literally everything

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Speaker 1: we do with The Walt Disney Company is collaborative. I'll

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Speaker 1: give you an example. My first week we were working

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Speaker 1: on a deal, don't have to get into the details

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Speaker 1: about it, and the team was presenting it out and

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Speaker 1: I just asked, what does content team x think about it?

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Speaker 1: And the answer was not sure. We have an ass

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Speaker 1: and I immediately called ahead of that content team and asked.

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Speaker 1: I understand where that responsibility now resides, but the idea

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Speaker 1: that we would not ask for the opinion of a

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Speaker 1: colleague that had previously had that responsibility is not how

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Speaker 1: we operated fundamentally, and I'm glad it happened early and

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Speaker 1: I'm glad it set a tone for how we operated

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Speaker 1: for the last two years. Interesting. Um, let's talk a

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Speaker 1: bit about out. Of course, streaming has been the, the

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Speaker 1: the only topic of conversation in media for for some

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Speaker 1: years now. I've kicked off, I think by the by

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Speaker 1: the by Disney going for it with Disney plus. Let's

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Speaker 1: talk a little bit. We are our time is flying

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Speaker 1: by here, but let's talk about the linear side of

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Speaker 1: the Disney TV universe, which is, you know, box office

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Speaker 1: and TV. That is what to end parks of course,

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Speaker 1: but I mean television is such an engine of the

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Speaker 1: and the channels, the the the existing the traditional cable channels, ESPN,

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Speaker 1: the Disney channels, it's spin offs, free form. You know,

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Speaker 1: there there's a sense that the linear world is the

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Speaker 1: melting ice cube. That is it's it's it's still a

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Speaker 1: big generator of earnings and profits, but it is a

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Speaker 1: melting ice cube, and that's when you know why the

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Speaker 1: big investment in streaming. How are you as because you

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Speaker 1: are responsible now for doing the deal for ESPN with

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Speaker 1: comcast and charter and getting those traditional near distribution for

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Speaker 1: the traditional cable channels, as well as as plotting the

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Speaker 1: future for Disney plus and Hulu and everything? How are you?

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Speaker 1: How do you approach the management of the LINEAR ESPN,

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Speaker 1: the linear free form? Of course, ESPN has been in

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Speaker 1: the headlines a little bit. There's been some discussion about it.

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Speaker 1: was there's been some discussions should Disney sell it or

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Speaker 1: spin it off? Bob jpeck spoke back to that. That

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Speaker 1: those suggestions. Thank you very much. I'd like to keep ESPN,

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Speaker 1: but can you talk about so I'm not asking to

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Speaker 1: comment on that, I know, but can you talk about

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Speaker 1: how you are managing those assets. And do you I

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Speaker 1: mean is it? Is it fair to say they are

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Speaker 1: melting ice cubes and it's a manage of managing the melt?

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Speaker 1: Or do you see that there are that we are

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Speaker 1: overestimating the decline there? Well, I often think looking at

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Speaker 1: industries is important, but if you look at historically what

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Speaker 1: the Walt Distant Company has done, that we have exceeded

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Speaker 1: and perhaps even lead those industries, despite the fundamentals that

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Speaker 1: may occur uh in the industries in which we participate

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Speaker 1: in what I mean by that is you mentioned espn it.

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Speaker 1: It's the number one cable network again, five years in

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Speaker 1: a row. ABC number one prime time entertainment, three years

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Speaker 1: in a row. I can keep going. There's there's a

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Speaker 1: lot here going to free form, fx and so forth.

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Speaker 1: We continue to perform well in those areas. That said,

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Speaker 1: streaming is a massive part of our future and our

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Speaker 1: job at D med is to balance across networks and

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Speaker 1: streaming and theatrical that means we know what the growth

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Speaker 1: we want to achieve in networks, we know we want

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Speaker 1: to achieve in box office and we invest appropriately and

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Speaker 1: again the content teams are creating amazing content. Against that

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Speaker 1: and it's not a one or the other type situation.

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Speaker 1: I won't give us specific stats. Woul look at something

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Speaker 1: like the old man that actually debuted on F x,

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Speaker 1: the Linear Channel, Jeff Bridges drama, which is fan terrific

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Speaker 1: vehicle for him and and I couldn't be more excited

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Speaker 1: about what that it's going to look like in the

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Speaker 1: future for the old man or what's that's gonna look like.

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Speaker 1: And we were talking about the M as backstage. I

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Speaker 1: think that's a fantastic show. Its viewership on the LINEAR fx.

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Speaker 1: Of course, at midnight it goes onto Hulu. The streaming

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Speaker 1: service is non cannibalistic. So we're actually reaching more audiences

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Speaker 1: than or more parts of the audience and we otherwise

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Speaker 1: would have with just a streaming or a linear component.

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Speaker 1: And that's the criticality of D med is that we're

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Speaker 1: able to look across all of these platforms, not at

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Speaker 1: the expense of another one. Right it is fundamentally we're

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Speaker 1: going to drive streaming growth. We have our our goals,

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Speaker 1: we're going to hit those goals, but we can also

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Speaker 1: have tremendous success in that works in theatrical and I

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Speaker 1: know there's more focused on the other parts of the

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Speaker 1: Walt Disney Company, perhaps outside of the company these days.

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Speaker 1: We've always had the focus internally about the variety of

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Speaker 1: platforms that we have in D med or the variety

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Speaker 1: of experience to the touchpoints that we have across the

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Speaker 1: Walt Disney Company with consumers. That is no less of

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Speaker 1: a priority now than it ever has been, and we

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Speaker 1: tie these organizations together in a way that, again, the

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Speaker 1: whole is is greater than some of the parts. And

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Speaker 1: we look at things like even Disney plus day, which

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Speaker 1: we had a week ago today, and it's a fantastic

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Speaker 1: opportunity where, if you're a Disney plus subscriber, you get

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Speaker 1: into the parks early, whether it's a Disney world, Disneyland,

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Speaker 1: Disneyland Paris, What have you. You get exclusive merchandise from

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Speaker 1: consumer products. There's a lot of things that you get

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Speaker 1: at a benefit of being a Disney plus subscriber across

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Speaker 1: the Walt Disney Company, and it seems like just one day.

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Speaker 1: The things that we're doing along these lines are fundamentally

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Speaker 1: what we want to provide every day to those that

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Speaker 1: are within the Disney family, to the degree that they

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Speaker 1: opt in and want to participate across all of these

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Speaker 1: different venues. We can enhance each of those experiences I

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Speaker 1: mentioned in the parks earlier. If you go to a

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Speaker 1: park and you have a meet and greet with the Princess,

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Speaker 1: I'd argue that's probably the best park and the best

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Speaker 1: meet and greet that you can have in the industry.

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Speaker 1: Come home and again, provided that that family wants to

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Speaker 1: hop into such an experience, shouldn't Disney plus be a

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Speaker 1: little bit more tailored towards Princess for those consumers? That's

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Speaker 1: something that we can do and again, I've spent time

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Speaker 1: working on some of these rides. I know are built

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Speaker 1: on game engines and it could be more responsive and

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Speaker 1: dynamic with regard to what types of stories are serving

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Speaker 1: up to you. If, if, IF, consumers want to be

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Speaker 1: a part of this experience, when we think a lot

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Speaker 1: of people are going to want that, based upon what

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Speaker 1: you've experienced on Disney plus or with consumer products, etcetera,

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Speaker 1: can we now offer you a different experience, a more specialized,

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Speaker 1: personalized experience, once you're on, excuse me, once you're on

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Speaker 1: that right Um at at one of our parks? Those

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Speaker 1: are the things that that we're working on again, much

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Speaker 1: more cohesively. That we frankly believe no other company on

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Speaker 1: the planet can do. And I know, Um, that CHAPEC

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Speaker 1: has talked that. There's there are there are things coming

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Speaker 1: to ESPN, LINEAR ESPN streaming, that are going to integrate it,

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Speaker 1: you know, even more into the into the Disney ecosystem.

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Speaker 1: But let me press you again. In that linear world,

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Speaker 1: are you anticipating some tough conversations coming up as you

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Speaker 1: as you renew LINEAR ESPN with traditional distributors like comcast,

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Speaker 1: like charter? Do you think? I mean ESPN has always

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Speaker 1: been at the top of the market in terms of fees.

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Speaker 1: Do you think those conversations are going to be tougher

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Speaker 1: in the future? We've had many of them over the

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Speaker 1: last couple of years, Um, and yes, they were tough

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Speaker 1: and they're kind of a given, but they're tough to

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Speaker 1: last cycle in the cycle before that. We have an

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Speaker 1: amazing distribution team that helps the M v P D

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Speaker 1: s understand the true value of what not just ESPN

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Speaker 1: but our entire suite of networks provide. It's hard to imagine, Um,

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Speaker 1: anyone not being able to appreciate really what ESPN does

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Speaker 1: in terms of tying together at core cable bundle Um

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Speaker 1: and think our partners understand that and they have understood

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Speaker 1: in these last cycles. Uh. Certainly again, we anticipate those

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Speaker 1: conversations to continue as they always have Um. But what

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Speaker 1: we've learned from our partners is that they understand the

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Speaker 1: same thing that we see with our consumers, is the

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Speaker 1: true value of ESPN to that bundle and we continue

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Speaker 1: to yield incredible value out of it, not just specifically

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Speaker 1: as a cruise to ESPN, but the entirety of our

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Speaker 1: cable networks as well. Yes, our time is our time

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Speaker 1: is running sort I want to ask you about Hulu,

431
00:23:34,280 --> 00:23:36,240
Speaker 1: because there's a lot, a lot in the world about Hulu.

432
00:23:36,280 --> 00:23:38,920
Speaker 1: I want to ask you specifically about Hulu live, that

433
00:23:39,119 --> 00:23:42,320
Speaker 1: service which is basically a digital M v P D.

434
00:23:43,240 --> 00:23:44,960
Speaker 1: let me ask you a skeptical question. Is that a

435
00:23:45,000 --> 00:23:47,720
Speaker 1: real business for you or is that an add on

436
00:23:48,280 --> 00:23:52,760
Speaker 1: that to keep that Hulu offers to some consumers? But

437
00:23:52,800 --> 00:23:56,120
Speaker 1: the bulk of Your Hulu is now stands at forties

438
00:23:56,160 --> 00:24:00,480
Speaker 1: six point two total subscribers and of those our million

439
00:24:00,720 --> 00:24:05,080
Speaker 1: take the Hulu live channel package. It's been flat the

440
00:24:05,160 --> 00:24:07,679
Speaker 1: last couple of quarters in terms of that growth in

441
00:24:07,720 --> 00:24:11,320
Speaker 1: that area. Is that something that is something that you

442
00:24:11,359 --> 00:24:14,240
Speaker 1: think can grow or do you think that is something

443
00:24:14,280 --> 00:24:17,400
Speaker 1: that is a value added but that's not a growth

444
00:24:17,440 --> 00:24:20,560
Speaker 1: area for Ulu? Well, we certainly believe in Hu live

445
00:24:20,680 --> 00:24:23,960
Speaker 1: as a product and we also believe, again, anything that

446
00:24:24,000 --> 00:24:27,160
Speaker 1: we do is we believe in in its own right,

447
00:24:27,240 --> 00:24:29,400
Speaker 1: but also the value that it yields to the rest

448
00:24:29,400 --> 00:24:32,320
Speaker 1: of the company. And with our last price increase for

449
00:24:32,440 --> 00:24:36,280
Speaker 1: Whu live, we enabled all of those subscribers to also

450
00:24:36,359 --> 00:24:39,840
Speaker 1: get the Disney Bundle. That is a significant benefit, of course,

451
00:24:39,880 --> 00:24:42,680
Speaker 1: for our streaming services as well. Again, it's all about

452
00:24:42,680 --> 00:24:45,960
Speaker 1: looking at every touch point optimizing that and we are

453
00:24:46,040 --> 00:24:49,119
Speaker 1: doing that with Hulu live, making that experience better and better,

454
00:24:49,840 --> 00:24:52,840
Speaker 1: but were also able to leverage that for the rest

455
00:24:52,880 --> 00:24:55,320
Speaker 1: of the company and that's, frankly, something we just do

456
00:24:55,440 --> 00:24:57,600
Speaker 1: quite well and we have found ways to do that

457
00:24:57,680 --> 00:24:59,639
Speaker 1: even with with who alive. So we believe in that

458
00:24:59,680 --> 00:25:01,840
Speaker 1: business in its own right as well as for the

459
00:25:01,840 --> 00:25:04,280
Speaker 1: benefits that accrued to the rest of our company as well.

460
00:25:04,800 --> 00:25:07,840
Speaker 1: Is that Disney Bundle? Is that a growth engine in

461
00:25:07,840 --> 00:25:10,000
Speaker 1: and of itself? Are you finding more people that come

462
00:25:10,040 --> 00:25:12,480
Speaker 1: to you come in for the bundle rather than one

463
00:25:12,520 --> 00:25:15,240
Speaker 1: of the services the bundle is if I'm not mistaken.

464
00:25:15,320 --> 00:25:18,919
Speaker 1: Disney plus, Hulu and ESPN plus at this moment correct,

465
00:25:18,960 --> 00:25:22,280
Speaker 1: and there's there's a lot of talk about fundamentally there's

466
00:25:22,280 --> 00:25:25,440
Speaker 1: so many different services. Well, that's what we we're able

467
00:25:25,440 --> 00:25:29,720
Speaker 1: to provide to consumers one cohesive solution where you have

468
00:25:29,760 --> 00:25:31,960
Speaker 1: the premium general entertainment with Hulu and the US, and

469
00:25:32,040 --> 00:25:36,000
Speaker 1: I I would challenge anyone who's got better content on

470
00:25:36,040 --> 00:25:39,159
Speaker 1: a platform than Hulu right now, whether it's the bear,

471
00:25:39,240 --> 00:25:43,760
Speaker 1: the patient, pray, drop out, dope, sick. You just keep

472
00:25:43,760 --> 00:25:45,960
Speaker 1: going and I know what the slate loots like as well,

473
00:25:46,000 --> 00:25:48,119
Speaker 1: so I know we will keep going. You add that

474
00:25:48,200 --> 00:25:51,480
Speaker 1: to the best branded platform out there from a streaming

475
00:25:51,480 --> 00:25:53,760
Speaker 1: perspective with Disney plus and the number one sports streaming

476
00:25:53,800 --> 00:25:57,120
Speaker 1: service out there, ESPN plus. We're providing a cohesive solution

477
00:25:57,600 --> 00:26:02,159
Speaker 1: for families of all different types of demographics and sizes

478
00:26:02,320 --> 00:26:04,760
Speaker 1: and interests, and that's what the Disney Bundle provides. And

479
00:26:04,840 --> 00:26:07,600
Speaker 1: we have found the more that we get consumers to

480
00:26:07,640 --> 00:26:11,040
Speaker 1: actually experience this bundle, the more likely that there to

481
00:26:11,320 --> 00:26:14,400
Speaker 1: stay and remain in our ecosystem, meaning our churn goes

482
00:26:14,480 --> 00:26:19,840
Speaker 1: down significantly. We have great churn numbers that were pleased

483
00:26:19,840 --> 00:26:22,679
Speaker 1: with on Disney plus or Hulu or ESPN plus. But

484
00:26:22,760 --> 00:26:24,800
Speaker 1: when you have all three and you can actually have

485
00:26:24,880 --> 00:26:26,800
Speaker 1: the totality of what we have to offer from a

486
00:26:26,840 --> 00:26:30,320
Speaker 1: streaming standpoint, consumers have found tremendous value in that and

487
00:26:30,359 --> 00:26:33,080
Speaker 1: they stay around even longer. So yes, we want more

488
00:26:33,119 --> 00:26:35,760
Speaker 1: people to adopt the Disney Bundle and we're happy with

489
00:26:35,760 --> 00:26:38,320
Speaker 1: that progress as well. Can you give us a sense, though,

490
00:26:38,359 --> 00:26:41,360
Speaker 1: like in recent months is it? Do you have more

491
00:26:41,400 --> 00:26:43,720
Speaker 1: people come in the door just for Disney plus, or

492
00:26:43,720 --> 00:26:45,800
Speaker 1: are you finding a lot of uptake on the bundle?

493
00:26:47,240 --> 00:26:51,360
Speaker 1: I would say it's each individual platform continues to grow

494
00:26:51,400 --> 00:26:55,520
Speaker 1: apace the bundle. There's two ways. Either you come in

495
00:26:55,520 --> 00:26:57,719
Speaker 1: for the Bundle and we've been pleased with that uptake,

496
00:26:58,040 --> 00:27:00,480
Speaker 1: but once you're in one of them, we have the

497
00:27:00,520 --> 00:27:03,400
Speaker 1: ability to of course cross sell and get you into

498
00:27:03,840 --> 00:27:06,320
Speaker 1: the bundle as well. So having those other cards have

499
00:27:06,440 --> 00:27:09,600
Speaker 1: helped be on ramps into the bundle. So we approach

500
00:27:09,680 --> 00:27:12,680
Speaker 1: it mirrored ways, and that's just in the US. When

501
00:27:12,680 --> 00:27:14,959
Speaker 1: you look at our content offerings in a place like Amia,

502
00:27:15,040 --> 00:27:18,480
Speaker 1: because this is an obviously global set of initiatives, or

503
00:27:18,520 --> 00:27:21,760
Speaker 1: general entertainment content, the same premium content to bear, the patient,

504
00:27:22,119 --> 00:27:26,040
Speaker 1: prey and so forth, resides on Disney plus in Europe

505
00:27:26,440 --> 00:27:29,840
Speaker 1: and that we've seen how that impacts engagement and gave

506
00:27:29,920 --> 00:27:33,960
Speaker 1: it being a great barometer for churn. It is tremendous

507
00:27:34,119 --> 00:27:37,080
Speaker 1: what that that has done in a media and that's

508
00:27:37,080 --> 00:27:39,600
Speaker 1: our solution. there. The Disney bundles what we're doing in

509
00:27:39,600 --> 00:27:41,160
Speaker 1: the US and we're quite pleased with that as well.

510
00:27:41,200 --> 00:27:43,480
Speaker 1: So we try to tailor again and have an inflexible

511
00:27:43,480 --> 00:27:46,880
Speaker 1: strategy allows us to tailor according to the needs uh

512
00:27:46,920 --> 00:27:50,159
Speaker 1: in any particular region and having the combination of our

513
00:27:50,240 --> 00:27:53,720
Speaker 1: general entertainment and are branded plus, frankly, in the US

514
00:27:53,800 --> 00:27:57,680
Speaker 1: are sports. We believe it's just the best, not just offering,

515
00:27:57,720 --> 00:28:02,800
Speaker 1: but it's about value that's out there in any streaming landscape.

516
00:28:02,840 --> 00:28:06,000
Speaker 1: That that we've contemplated. So that is what we focus on,

517
00:28:06,200 --> 00:28:12,480
Speaker 1: but again, each individual service continues perform as well. We're

518
00:28:12,480 --> 00:28:14,680
Speaker 1: going to take a quick commercial break, but when we

519
00:28:14,760 --> 00:28:17,920
Speaker 1: return we've got a second interview with the top executives

520
00:28:17,920 --> 00:28:29,159
Speaker 1: at Hollywood's masters of horror, Blumhouse, and we're back with

521
00:28:29,359 --> 00:28:33,719
Speaker 1: Jason Blum and Abba J Prakash, the lead executives at Blumhouse.

522
00:28:34,080 --> 00:28:40,400
Speaker 1: Take a listen. I was curious in terms of getting

523
00:28:40,440 --> 00:28:43,680
Speaker 1: into the TV business, where I think you're a little uh.

524
00:28:43,720 --> 00:28:46,040
Speaker 1: You know, obviously film it's much more mature. What did

525
00:28:46,080 --> 00:28:50,040
Speaker 1: you see as the opportunity there? Um, we got into

526
00:28:50,080 --> 00:28:54,600
Speaker 1: the television business because we started to have a consumer

527
00:28:54,640 --> 00:28:58,360
Speaker 1: facing brand that was taking hold and so I thought

528
00:28:58,360 --> 00:29:02,640
Speaker 1: it would be silly not to exploit that brand in

529
00:29:02,720 --> 00:29:08,680
Speaker 1: television also. Um. And the complicated thing about TV and

530
00:29:08,680 --> 00:29:12,280
Speaker 1: and and of our movie business is horror and is

531
00:29:12,360 --> 00:29:15,160
Speaker 1: kind of other. TV is almost reversed. It's about seventy

532
00:29:16,680 --> 00:29:21,120
Speaker 1: horror now. The other is it's a it's a broad definition.

533
00:29:21,160 --> 00:29:24,040
Speaker 1: That's it's dark themes that are right. We did a

534
00:29:24,040 --> 00:29:26,680
Speaker 1: show called the loudest voice in the room about Roger Rails.

535
00:29:26,720 --> 00:29:28,440
Speaker 1: Now it wasn't a horror show, but he was a

536
00:29:28,440 --> 00:29:33,240
Speaker 1: horrible guy. So so, so, uh so. So that's how

537
00:29:33,280 --> 00:29:36,880
Speaker 1: it's kind of we we tangentially related to blumhouse. Um,

538
00:29:36,920 --> 00:29:43,640
Speaker 1: the complicated thing, ah for us in our television business

539
00:29:43,760 --> 00:29:49,360
Speaker 1: is that the DNA of our company is that we

540
00:29:49,440 --> 00:29:53,320
Speaker 1: work on commission. We don't get fees. That's just so

541
00:29:53,480 --> 00:29:56,200
Speaker 1: built into our process. On the movie side, we don't

542
00:29:56,240 --> 00:29:59,080
Speaker 1: get a producing fee. We got a piece of the profits.

543
00:29:59,280 --> 00:30:02,880
Speaker 1: The more success well we are, the bigger that pieces Um.

544
00:30:02,920 --> 00:30:08,880
Speaker 1: And I as a business person, producer, entrepreneur and much

545
00:30:08,960 --> 00:30:12,960
Speaker 1: more comfortable in that model. I'm much more comfortable going

546
00:30:12,960 --> 00:30:15,000
Speaker 1: to someone and getting a big check if I'm not

547
00:30:15,040 --> 00:30:17,080
Speaker 1: getting a piece of the check, if I'm saying to

548
00:30:17,120 --> 00:30:19,720
Speaker 1: the person I love this, pay for it, I'm not

549
00:30:19,720 --> 00:30:22,040
Speaker 1: going to make any money until you do or until

550
00:30:22,080 --> 00:30:26,240
Speaker 1: this show does. And I think the complicated thing is

551
00:30:26,280 --> 00:30:28,680
Speaker 1: that the TV business just doesn't work that you can

552
00:30:28,720 --> 00:30:30,640
Speaker 1: beg all you want to work for nothing and get

553
00:30:30,640 --> 00:30:32,760
Speaker 1: paid in success and they won't do that. You know,

554
00:30:32,920 --> 00:30:36,320
Speaker 1: everyone gets paid upfront and you negotiate for as much

555
00:30:36,360 --> 00:30:38,520
Speaker 1: as you can upfront before you make the thing that

556
00:30:38,560 --> 00:30:44,200
Speaker 1: you're making. And and I just I spiritually find that complicated. Well,

557
00:30:44,280 --> 00:30:46,360
Speaker 1: let's get into that because that's, you know, a big

558
00:30:46,400 --> 00:30:49,280
Speaker 1: issue in the industry, perhaps the biggest. You've written a

559
00:30:49,280 --> 00:30:52,479
Speaker 1: New York Times op ed about this. UH, in the

560
00:30:52,600 --> 00:30:55,960
Speaker 1: streaming age. Just to explain everyone, make sure we all understand,

561
00:30:56,880 --> 00:30:59,920
Speaker 1: it works on a cost plus model all the stream

562
00:31:00,080 --> 00:31:02,160
Speaker 1: or starting with Netflix, but it kind of went to

563
00:31:02,200 --> 00:31:04,760
Speaker 1: all of them in time started paying in a way

564
00:31:04,880 --> 00:31:07,880
Speaker 1: where you would cover the cost of production and get

565
00:31:07,880 --> 00:31:10,680
Speaker 1: a nice healthy premium on top of that, maybe ten,

566
00:31:12,440 --> 00:31:16,280
Speaker 1: but you're basically signing away all your rights. Uh in

567
00:31:16,400 --> 00:31:19,440
Speaker 1: the process. You just mentioned. You want to come at

568
00:31:19,480 --> 00:31:23,640
Speaker 1: it a completely different way. How are you able to

569
00:31:23,800 --> 00:31:28,200
Speaker 1: function in this world where basically all the buyers, the

570
00:31:28,200 --> 00:31:31,000
Speaker 1: biggest buyers in town, want to do different business, a

571
00:31:31,040 --> 00:31:33,880
Speaker 1: lot differently than you do? Um. Well, like I say,

572
00:31:33,960 --> 00:31:35,720
Speaker 1: I I functioned, but it's hard. If you, if you

573
00:31:35,760 --> 00:31:39,040
Speaker 1: think about what you just said, cost plus. They're basically

574
00:31:39,280 --> 00:31:42,520
Speaker 1: telling the producer to make the show as expensive as

575
00:31:42,560 --> 00:31:46,800
Speaker 1: it possibly can be, because the more the show costs,

576
00:31:47,120 --> 00:31:50,080
Speaker 1: the more you're going to get paid. That is crazy.

577
00:31:50,520 --> 00:31:54,200
Speaker 1: It's just insane and it's it's also, to Ab Age's point,

578
00:31:54,280 --> 00:31:57,200
Speaker 1: like when when you're when your whole other company is

579
00:31:57,240 --> 00:31:58,959
Speaker 1: built on I got the thing as low as I

580
00:31:59,000 --> 00:32:01,720
Speaker 1: possibly could so the profit is as big as possible.

581
00:32:01,760 --> 00:32:03,680
Speaker 1: So your piece of that problem as big as possible.

582
00:32:03,800 --> 00:32:05,600
Speaker 1: You just have to take a whole another thinking to

583
00:32:05,760 --> 00:32:09,240
Speaker 1: like you. You every producer, whether they admit this or not,

584
00:32:09,280 --> 00:32:11,640
Speaker 1: they do the same thing. They do their show, they

585
00:32:11,680 --> 00:32:13,960
Speaker 1: do their budget. Their budget is whatever it is. Then

586
00:32:14,000 --> 00:32:15,880
Speaker 1: they say, how much do we actually think we can

587
00:32:15,920 --> 00:32:19,040
Speaker 1: get from these guys. Add that much and submit it,

588
00:32:19,800 --> 00:32:22,840
Speaker 1: and and and and the content business across movies and

589
00:32:22,880 --> 00:32:28,200
Speaker 1: TV for a hundred years. As much data as you have,

590
00:32:28,440 --> 00:32:30,680
Speaker 1: as good as you think you are at doing the

591
00:32:30,800 --> 00:32:34,520
Speaker 1: job of picking, no one has ever picked even close

592
00:32:34,600 --> 00:32:39,680
Speaker 1: to sot. Usually fifty six of what you make is

593
00:32:39,680 --> 00:32:43,520
Speaker 1: not super profitable and if you're paying everyone up front,

594
00:32:44,000 --> 00:32:46,800
Speaker 1: you're acting as if almost everything you're doing is profitable.

595
00:32:46,880 --> 00:32:49,160
Speaker 1: So I think, like my article said, I think it's

596
00:32:49,160 --> 00:32:52,479
Speaker 1: a I think it's a challenge system and I hope

597
00:32:52,520 --> 00:32:55,520
Speaker 1: one day will change it. Well, hope it still exists

598
00:32:55,520 --> 00:32:57,800
Speaker 1: in movies and I hope one day will will, will

599
00:32:57,920 --> 00:33:02,920
Speaker 1: TV will go back to uh sharing and making making

600
00:33:02,960 --> 00:33:05,760
Speaker 1: shows that are less expensive. Hope is a nice thing.

601
00:33:06,480 --> 00:33:10,400
Speaker 1: I have. J What what steps can a company like

602
00:33:10,440 --> 00:33:14,840
Speaker 1: yourself take too effectuate change and get the kind of

603
00:33:14,920 --> 00:33:17,960
Speaker 1: models that you want? Are perhaps there's signs already that

604
00:33:18,040 --> 00:33:23,719
Speaker 1: these changes are happening, because clearly we're seeing voices like Jason's, others,

605
00:33:23,760 --> 00:33:26,440
Speaker 1: people out there who are, you know, making the call

606
00:33:26,520 --> 00:33:30,360
Speaker 1: as well. Is there any hope? Yeah, well, look, I think,

607
00:33:30,640 --> 00:33:35,040
Speaker 1: like Jason said, the model has worked extraordinarily well in

608
00:33:35,120 --> 00:33:37,240
Speaker 1: the film business, and so we try to point that

609
00:33:37,280 --> 00:33:40,000
Speaker 1: out as much as possible when we're bringing our series

610
00:33:40,080 --> 00:33:42,640
Speaker 1: business to different buyers. But you you said it right,

611
00:33:42,680 --> 00:33:45,280
Speaker 1: chef Sigainsky, Bob Iger. There's other folks who've been talking

612
00:33:45,320 --> 00:33:47,400
Speaker 1: about how our creator is going to be compensated in

613
00:33:47,480 --> 00:33:51,280
Speaker 1: a perpetuity cost plus streaming buyout model. You have to

614
00:33:51,360 --> 00:33:54,480
Speaker 1: change that right. I think there are some signs that's

615
00:33:54,480 --> 00:33:56,959
Speaker 1: going to change. If you're looking for silver linings of

616
00:33:57,040 --> 00:34:00,320
Speaker 1: the sort of Netflix stock market correction and the shift

617
00:34:00,360 --> 00:34:04,440
Speaker 1: to cash flow is a metric for for valuing streaming businesses.

618
00:34:04,880 --> 00:34:09,359
Speaker 1: There's a different degree of selectivity, judiciousness and cost consciousness

619
00:34:09,360 --> 00:34:12,640
Speaker 1: that's now seeping into the way buyers approach buying series.

620
00:34:12,680 --> 00:34:16,000
Speaker 1: And so in that model, could you have things where

621
00:34:16,000 --> 00:34:19,520
Speaker 1: projects like ours Um come in? Maybe they're lower budget

622
00:34:19,520 --> 00:34:22,080
Speaker 1: than the other ones and so they're more willing to

623
00:34:23,239 --> 00:34:25,480
Speaker 1: do those. We can either make it up in volume or,

624
00:34:25,560 --> 00:34:28,960
Speaker 1: more interestingly, to align with what Jason's Abed said, maybe

625
00:34:29,000 --> 00:34:31,520
Speaker 1: it's not a perpetuity buy out for cost plus. Maybe

626
00:34:31,560 --> 00:34:33,840
Speaker 1: it's a licensing term and we get rights back later.

627
00:34:34,000 --> 00:34:36,719
Speaker 1: Maybe there is contingent comp based on viewership. So it

628
00:34:36,800 --> 00:34:39,680
Speaker 1: lowers what the buyers paying up front. But then if

629
00:34:39,719 --> 00:34:43,840
Speaker 1: you hit certain thresholds right about overall views relative to

630
00:34:43,880 --> 00:34:46,479
Speaker 1: the cost of the thing, or you're in a top

631
00:34:46,520 --> 00:34:49,359
Speaker 1: five ranking over the quarter of the year, you can

632
00:34:49,360 --> 00:34:52,080
Speaker 1: get some contingent comps, so that that is kind of

633
00:34:52,080 --> 00:34:54,520
Speaker 1: a win win, where then you're only getting extra money

634
00:34:54,520 --> 00:34:57,319
Speaker 1: from the buyers in success where they're getting real value

635
00:34:57,320 --> 00:35:00,239
Speaker 1: from the show and it also lowers their up rent

636
00:35:00,280 --> 00:35:02,680
Speaker 1: cost which could work for us because we're not always,

637
00:35:02,920 --> 00:35:05,239
Speaker 1: you know, with the budgets that we do, we know

638
00:35:05,280 --> 00:35:07,160
Speaker 1: how to make things for less cost, right, and so

639
00:35:07,200 --> 00:35:09,760
Speaker 1: that could really played our advantage. But I haven't seen examples.

640
00:35:09,760 --> 00:35:11,840
Speaker 1: Maybe you guys have. No one showed up with that

641
00:35:11,920 --> 00:35:13,719
Speaker 1: deal yet and put it in front of us. So

642
00:35:13,760 --> 00:35:15,160
Speaker 1: I think we're gonna have to bring it with one

643
00:35:15,160 --> 00:35:17,120
Speaker 1: of our properties to the market. I mean we should

644
00:35:17,120 --> 00:35:19,920
Speaker 1: explain the logic behind what the streamers are doing. Is

645
00:35:20,560 --> 00:35:23,240
Speaker 1: and perhaps different than the businesses of old that we're

646
00:35:23,239 --> 00:35:26,240
Speaker 1: buying projects. is they are trying to hit a global

647
00:35:26,280 --> 00:35:29,799
Speaker 1: audience and they want all those rights in perpetuity. And

648
00:35:30,080 --> 00:35:32,560
Speaker 1: you know, is it possible? Jason? There are some producers

649
00:35:32,600 --> 00:35:35,680
Speaker 1: that are like, look, blum's got a great track record,

650
00:35:36,000 --> 00:35:39,160
Speaker 1: but others may be comfortable with getting de risked and

651
00:35:39,200 --> 00:35:43,280
Speaker 1: getting that premium in the beginning and, you know, washing

652
00:35:43,320 --> 00:35:45,319
Speaker 1: their hands with it. I think there are a lot

653
00:35:45,400 --> 00:35:48,680
Speaker 1: of producers like that and I think the idea and

654
00:35:48,680 --> 00:35:51,760
Speaker 1: and that exists in the movie business to a certain degree.

655
00:35:52,000 --> 00:35:53,920
Speaker 1: You can take a big fee and get a smaller

656
00:35:53,960 --> 00:35:55,360
Speaker 1: back end, or you can go to the studio and

657
00:35:55,440 --> 00:35:56,600
Speaker 1: say I don't want to fee and I want to

658
00:35:56,640 --> 00:35:59,319
Speaker 1: share more, and most studios are kind of open to

659
00:36:00,160 --> 00:36:02,640
Speaker 1: handling a little bit about that. So and I and

660
00:36:02,640 --> 00:36:06,280
Speaker 1: and there's there's another Um to flip what I said

661
00:36:06,640 --> 00:36:11,120
Speaker 1: on its head. There's another Um benefit to paying people out.

662
00:36:11,160 --> 00:36:13,160
Speaker 1: It's like I always say, it's like a little kind

663
00:36:13,160 --> 00:36:16,479
Speaker 1: of like a Communist system, which is the following, which

664
00:36:16,560 --> 00:36:22,640
Speaker 1: is that you can make shows and movies a little

665
00:36:22,640 --> 00:36:25,480
Speaker 1: bit different than your point for a very small audience.

666
00:36:26,360 --> 00:36:28,600
Speaker 1: You can make art house shows and movies for a

667
00:36:28,640 --> 00:36:32,960
Speaker 1: small audience and still get paid. So the the the

668
00:36:32,960 --> 00:36:38,319
Speaker 1: the commercial shows and movies that streamers are doing are

669
00:36:38,440 --> 00:36:42,879
Speaker 1: subsidizing art, which happens all the time. If you look

670
00:36:42,880 --> 00:36:45,439
Speaker 1: at if used, if you look at the budgets of

671
00:36:45,480 --> 00:36:49,080
Speaker 1: the last streaming movies in Venice. These are all art

672
00:36:49,080 --> 00:36:52,680
Speaker 1: house movies. Um, uh. Eight years ago they would have

673
00:36:52,680 --> 00:36:55,600
Speaker 1: been fifteen million dollar movies. Now there are hundred million

674
00:36:55,640 --> 00:36:58,560
Speaker 1: dollar movies. There's no way there's an audience to justify

675
00:36:58,600 --> 00:37:01,719
Speaker 1: the hundred million dollars. But it's being subsidized by the

676
00:37:02,040 --> 00:37:04,640
Speaker 1: by the shows that are hitting, by by stranger things.

677
00:37:04,960 --> 00:37:07,040
Speaker 1: So they are, in a sense, they're taking from Peter

678
00:37:07,120 --> 00:37:09,200
Speaker 1: to pay Paul, which is, you know, there's something good

679
00:37:09,200 --> 00:37:11,479
Speaker 1: about that, but uh, but again, I think it would

680
00:37:11,480 --> 00:37:13,879
Speaker 1: be better if there was more flexibility to it. Well,

681
00:37:13,920 --> 00:37:16,280
Speaker 1: we should also point out that part of this uh

682
00:37:16,600 --> 00:37:21,520
Speaker 1: fausten bargain with the streamers is you get this, you

683
00:37:21,560 --> 00:37:24,600
Speaker 1: don't get back end, you get this cost plus up

684
00:37:24,719 --> 00:37:29,640
Speaker 1: front and you don't get any data. So, Avaj, how

685
00:37:29,680 --> 00:37:33,000
Speaker 1: do you fly blind without that? And is there hope?

686
00:37:33,080 --> 00:37:35,919
Speaker 1: They're for starting to get that going? It's a good point.

687
00:37:35,920 --> 00:37:38,400
Speaker 1: I cited the like the change in the correction in

688
00:37:38,400 --> 00:37:40,560
Speaker 1: the way streamers are valued. Is One thing. The other

689
00:37:40,600 --> 00:37:43,520
Speaker 1: one is what you just lived to many, which is, Um,

690
00:37:43,760 --> 00:37:47,879
Speaker 1: this inexorable march towards more openness and transparency around what

691
00:37:48,080 --> 00:37:51,759
Speaker 1: consumers are doing when it comes to streaming content, and

692
00:37:52,000 --> 00:37:54,560
Speaker 1: that is going to happen and once that's out there, right.

693
00:37:54,640 --> 00:37:56,720
Speaker 1: So already you can see Nielsen and other folks trying

694
00:37:56,719 --> 00:37:59,160
Speaker 1: to you know, they publish it Netflix then obviously moved

695
00:37:59,200 --> 00:38:01,000
Speaker 1: to start to do their twe ten. So we're moving

696
00:38:01,000 --> 00:38:03,839
Speaker 1: in that direction. UH, SAMBA TV, there's a whole bunch

697
00:38:03,840 --> 00:38:05,920
Speaker 1: of other data sources out there. So we're moving that direction.

698
00:38:06,160 --> 00:38:09,040
Speaker 1: Once that's really out there, you know, you've got agents

699
00:38:09,040 --> 00:38:11,359
Speaker 1: in the room here. They're gonna notice and go, Hey,

700
00:38:11,400 --> 00:38:14,080
Speaker 1: I see what my show did, my client show did.

701
00:38:14,400 --> 00:38:16,680
Speaker 1: Producers will notice and go, I need to get paid

702
00:38:16,680 --> 00:38:19,080
Speaker 1: for this. It did ten x what that guy's show

703
00:38:19,160 --> 00:38:21,279
Speaker 1: did and I need to be rewarded for that. So

704
00:38:21,320 --> 00:38:23,719
Speaker 1: that's another way that hopefully, we can achieve the goal,

705
00:38:23,880 --> 00:38:25,359
Speaker 1: which is you're going to be able to have more

706
00:38:25,360 --> 00:38:29,800
Speaker 1: transparency on what works right. You at least have a

707
00:38:29,880 --> 00:38:32,040
Speaker 1: version of that. Is One of the challenges, Um, I

708
00:38:32,080 --> 00:38:33,880
Speaker 1: think in in in from film the TV is that

709
00:38:33,960 --> 00:38:37,120
Speaker 1: there's less because so much of the consumption is not

710
00:38:37,239 --> 00:38:39,480
Speaker 1: driven by linear ratings, which we have access to, but

711
00:38:39,600 --> 00:38:42,759
Speaker 1: happens inside of streaming universes that you don't have access to.

712
00:38:43,000 --> 00:38:45,600
Speaker 1: You have box office still as a very relevant metric

713
00:38:45,600 --> 00:38:47,719
Speaker 1: about how your movie did if it comes out theatrically,

714
00:38:47,800 --> 00:38:49,799
Speaker 1: which can bolster an argument of going, I need a

715
00:38:49,800 --> 00:38:52,120
Speaker 1: bonus if it hits a hundred million or whatever. We

716
00:38:52,160 --> 00:38:54,040
Speaker 1: don't have that on TV equip. And the only thing

717
00:38:54,040 --> 00:38:56,080
Speaker 1: I would add to that is because when you add

718
00:38:56,080 --> 00:38:58,680
Speaker 1: an advertising gear you have to share data. They'RE gonna

719
00:38:58,719 --> 00:39:01,200
Speaker 1: have to share data with word when Ford is advertising.

720
00:39:01,480 --> 00:39:03,200
Speaker 1: Like definitely just trying to get away without it right now.

721
00:39:03,239 --> 00:39:06,399
Speaker 1: From what? But that's why I don't I think that's well,

722
00:39:06,719 --> 00:39:08,400
Speaker 1: you know, they've done other things that never thought they

723
00:39:08,440 --> 00:39:10,080
Speaker 1: could do. Maybe they'll do that. I think it'd be

724
00:39:10,200 --> 00:39:15,319
Speaker 1: very complicated to sell advertising to uh corporations without sharing data.

725
00:39:15,719 --> 00:39:18,719
Speaker 1: So the hope is that as marketers get data, you

726
00:39:18,719 --> 00:39:21,120
Speaker 1: guys will get as well. Well, it'll it'll be the

727
00:39:21,200 --> 00:39:23,200
Speaker 1: dam will break. It harms you. Right, you have an

728
00:39:23,239 --> 00:39:25,680
Speaker 1: argument and you can point to something right. But while

729
00:39:25,680 --> 00:39:28,239
Speaker 1: we're doing the military metaphor, I should point out that

730
00:39:28,680 --> 00:39:31,920
Speaker 1: the big bad streamers aren't as big and bad as

731
00:39:31,960 --> 00:39:35,040
Speaker 1: they used to be. We've seen the NETFLIX correction. We've

732
00:39:35,080 --> 00:39:37,600
Speaker 1: seen really a correction for the whole marketplace. Doesn't that

733
00:39:37,680 --> 00:39:43,720
Speaker 1: increase the leverage when you come to these negotiations. I

734
00:39:43,760 --> 00:39:52,920
Speaker 1: think the correction has made. Transactional, Um, the transactional distribution

735
00:39:52,960 --> 00:39:56,720
Speaker 1: of entertainment not a dirty word again, which is great.

736
00:39:57,040 --> 00:40:01,480
Speaker 1: You know, I think it's very good and so and so. Um.

737
00:40:01,520 --> 00:40:03,640
Speaker 1: So the answer is yes, I think streaming is is

738
00:40:03,719 --> 00:40:07,560
Speaker 1: a big part of how content will be distributed, but

739
00:40:07,600 --> 00:40:09,480
Speaker 1: it's not the only way and I think that's what

740
00:40:09,480 --> 00:40:11,359
Speaker 1: we've seen over the last six months and I think

741
00:40:11,360 --> 00:40:16,359
Speaker 1: that's healthy overall for the entertainment ecosystem. We should point

742
00:40:16,400 --> 00:40:20,319
Speaker 1: out you're not exactly a profit participation purist in the

743
00:40:20,400 --> 00:40:23,480
Speaker 1: sense not at all done these premium deals. Not at all.

744
00:40:23,680 --> 00:40:28,759
Speaker 1: Great deal with NBCUNIVERSAL for a reboot of the exorcist,

745
00:40:28,880 --> 00:40:32,960
Speaker 1: with three different movies, four hundred million dollars. So you're

746
00:40:33,000 --> 00:40:36,239
Speaker 1: not above taking this up front dollars. No, not at all.

747
00:40:36,280 --> 00:40:40,480
Speaker 1: And and I I um. You know what I was

748
00:40:40,480 --> 00:40:42,600
Speaker 1: thinking about this. I'm going to try it out. You'll

749
00:40:42,600 --> 00:40:44,640
Speaker 1: see if you go for it. You can tell me

750
00:40:44,680 --> 00:40:48,400
Speaker 1: if you think I'm I'm you're comfortable with full I um.

751
00:40:48,480 --> 00:40:54,600
Speaker 1: So here here's how I look at that. Like I think, Um,

752
00:40:54,719 --> 00:40:58,239
Speaker 1: which people, including they should pay more taxes, right, but

753
00:40:58,320 --> 00:41:00,920
Speaker 1: I'm not. And then some people the know. Some people say, well,

754
00:41:00,960 --> 00:41:03,200
Speaker 1: just give the government more money. Well, a little extra

755
00:41:03,239 --> 00:41:04,520
Speaker 1: money from me is not going to move the needle

756
00:41:04,520 --> 00:41:07,200
Speaker 1: on the government. So I'm not going to voluntarily give

757
00:41:07,280 --> 00:41:09,240
Speaker 1: the government more money because I think which people should

758
00:41:09,239 --> 00:41:11,480
Speaker 1: pay more taxes. But I would be very happy if

759
00:41:11,560 --> 00:41:14,440
Speaker 1: all operating come people included myself, paid more. Right, but

760
00:41:14,480 --> 00:41:16,799
Speaker 1: I can't. I'm not gonna so the idea that this

761
00:41:16,920 --> 00:41:21,520
Speaker 1: system exists. I'M NOT gonna I'm gonna work within the system,

762
00:41:21,520 --> 00:41:23,840
Speaker 1: but I wish the system was different. How do you

763
00:41:23,880 --> 00:41:27,080
Speaker 1: think that's a fair comparison? Do you think that's fair enough?

764
00:41:27,280 --> 00:41:30,800
Speaker 1: Where you were going? Think that's fair enough. You understand

765
00:41:30,960 --> 00:41:33,799
Speaker 1: that work for your system and you have to do

766
00:41:33,840 --> 00:41:35,759
Speaker 1: what's best. You think I'm still a hypocrite, you can

767
00:41:35,800 --> 00:41:41,279
Speaker 1: tell me. I think there's some hypocrisy, but I'm not

768
00:41:41,360 --> 00:41:47,359
Speaker 1: calling you get business, you know. One last question on

769
00:41:47,400 --> 00:41:53,279
Speaker 1: this front. Jeff SAGANCY has, Jeff Sagansky has said that

770
00:41:53,320 --> 00:41:55,440
Speaker 1: you guys should be like petitioning the do O J

771
00:41:55,760 --> 00:41:58,279
Speaker 1: and Congress. Is that where this is going to end up?

772
00:41:59,239 --> 00:42:01,800
Speaker 1: I don't know about that. I don't know enough about

773
00:42:01,840 --> 00:42:03,920
Speaker 1: how I wish, I I don't know enough about it.

774
00:42:03,960 --> 00:42:05,960
Speaker 1: But if there was some kind of class action on

775
00:42:06,080 --> 00:42:10,040
Speaker 1: creatives and suppliers to share data and everything else, I'd

776
00:42:10,040 --> 00:42:11,400
Speaker 1: be the first to join. But I don't know. I

777
00:42:11,440 --> 00:42:13,560
Speaker 1: don't know the beginning of how to do that. Well,

778
00:42:13,680 --> 00:42:16,400
Speaker 1: Jeff can help us. We'll sign. We'll sign the petition

779
00:42:16,680 --> 00:42:18,520
Speaker 1: just as long as jeff takes the lead. No, I'll

780
00:42:18,560 --> 00:42:20,000
Speaker 1: take the lead, even I just don't know how to

781
00:42:20,040 --> 00:42:22,080
Speaker 1: do that. But I don't know enough about if that's

782
00:42:22,120 --> 00:42:24,479
Speaker 1: even possible. But I love the idea. Well, there's big

783
00:42:24,600 --> 00:42:27,319
Speaker 1: union deals coming up next year. Could that be the

784
00:42:27,360 --> 00:42:29,399
Speaker 1: place where this comes to a head? It's the same

785
00:42:29,440 --> 00:42:32,960
Speaker 1: thing where the producers, artists, craftsmen were all aligned on

786
00:42:32,960 --> 00:42:36,759
Speaker 1: this side and get compensated, you know, more fairly right

787
00:42:36,800 --> 00:42:39,120
Speaker 1: for the performance of what we do. And so yes,

788
00:42:39,160 --> 00:42:41,560
Speaker 1: that's another angle that could could also help for sure.

789
00:42:42,600 --> 00:42:44,399
Speaker 1: All right, let's shift gears and talk a bit about

790
00:42:44,480 --> 00:42:48,840
Speaker 1: the box office. I'm curious how you guys feel about

791
00:42:49,440 --> 00:42:54,560
Speaker 1: movies playing in theaters and how long they need in theaters.

792
00:42:55,640 --> 00:43:00,839
Speaker 1: Is there a one size fits all solution for Blumhouse,

793
00:43:01,080 --> 00:43:04,880
Speaker 1: or does everything kind of depend on the particular movie

794
00:43:04,920 --> 00:43:08,000
Speaker 1: that you're talking about? That's you. I mean, I think

795
00:43:08,080 --> 00:43:10,160
Speaker 1: it is not one size fits all. It does very

796
00:43:10,200 --> 00:43:12,440
Speaker 1: movie by movie. You can just look at what's happened

797
00:43:12,440 --> 00:43:15,440
Speaker 1: with our films to see that right. You've got things

798
00:43:15,480 --> 00:43:17,480
Speaker 1: you know. We did a movie with focus called vengeance

799
00:43:17,480 --> 00:43:20,239
Speaker 1: that's on a very different scale than Halloween, and we

800
00:43:20,360 --> 00:43:23,400
Speaker 1: had firestarter and we have Halloween ends coming up. It's

801
00:43:23,480 --> 00:43:25,839
Speaker 1: Day and date and we have black phone, and those

802
00:43:25,880 --> 00:43:29,319
Speaker 1: all had different models of how they came how they

803
00:43:29,360 --> 00:43:31,319
Speaker 1: got released, and so it's not one size fits all.

804
00:43:31,360 --> 00:43:34,200
Speaker 1: We're just trying to figure out what the right optimal

805
00:43:34,239 --> 00:43:36,560
Speaker 1: one is. It's a guess. You don't get to like

806
00:43:36,680 --> 00:43:38,799
Speaker 1: do a control, a b test and then figure it out.

807
00:43:38,840 --> 00:43:40,640
Speaker 1: So you look at the movie and you have an

808
00:43:40,640 --> 00:43:43,040
Speaker 1: assessment with our partners and then you try to arrive

809
00:43:43,080 --> 00:43:45,439
Speaker 1: at the release plan that makes the most sense. And

810
00:43:45,520 --> 00:43:47,719
Speaker 1: for the most part we've done it pretty well and

811
00:43:47,760 --> 00:43:50,239
Speaker 1: I think demonstrated some things that people did not think

812
00:43:50,320 --> 00:43:52,520
Speaker 1: was possible. Halloween is probably the best example, where you

813
00:43:52,560 --> 00:43:54,799
Speaker 1: made had a movie come out that was day and date,

814
00:43:55,200 --> 00:43:56,920
Speaker 1: like Oh, it's kind of crushed the box office. Who

815
00:43:56,920 --> 00:43:59,360
Speaker 1: would ever leave the house? And it worked great in

816
00:43:59,400 --> 00:44:01,680
Speaker 1: the box off us right open a fifty million bucks

817
00:44:01,760 --> 00:44:05,160
Speaker 1: and was a massive success on streaming right, which people?

818
00:44:05,440 --> 00:44:08,040
Speaker 1: You kind of have this very easy. I don't mean

819
00:44:08,080 --> 00:44:10,600
Speaker 1: to pick on folks in the press opposition that people

820
00:44:10,640 --> 00:44:13,680
Speaker 1: like to write about theatrical versus streaming. We think those

821
00:44:13,719 --> 00:44:16,400
Speaker 1: things actually support each other and ultimately everything ends up

822
00:44:16,400 --> 00:44:19,360
Speaker 1: on streaming, just sometimes it starts on theatrical and sometimes

823
00:44:19,360 --> 00:44:21,360
Speaker 1: it starts on theatrical with a window like you have

824
00:44:21,480 --> 00:44:23,759
Speaker 1: up there, and sometimes it starts in theatrical day and day.

825
00:44:24,320 --> 00:44:26,840
Speaker 1: So yeah, we absolutely think about it along with our partners,

826
00:44:26,880 --> 00:44:29,520
Speaker 1: about what the right thing is for each movie. Jason,

827
00:44:29,520 --> 00:44:31,879
Speaker 1: how are you feeling about the box office these days?

828
00:44:31,920 --> 00:44:34,560
Speaker 1: It's been quite a year where if we talked in

829
00:44:34,560 --> 00:44:37,440
Speaker 1: the middle of the summer you'd probably be, like a

830
00:44:37,440 --> 00:44:39,920
Speaker 1: lot of people, very optimistic. Look at top gun going

831
00:44:40,000 --> 00:44:42,680
Speaker 1: a billion dollars, but as we've come into the fall

832
00:44:43,040 --> 00:44:46,440
Speaker 1: it's looking like box office for the year will probably

833
00:44:46,440 --> 00:44:51,719
Speaker 1: be down, at least compared to so the future of

834
00:44:51,760 --> 00:44:56,759
Speaker 1: exhibition broadly speaking, are you feeling good? UH, well, I

835
00:44:56,800 --> 00:44:58,799
Speaker 1: don't know if I was saying I'm feeling good. I'm

836
00:44:58,800 --> 00:45:02,520
Speaker 1: feeling optimistic. I think it's never gonna be what it was.

837
00:45:02,840 --> 00:45:04,960
Speaker 1: I think what is clear is there's a certain kind

838
00:45:05,000 --> 00:45:07,400
Speaker 1: of movie that is still working. Luckily, horror is one

839
00:45:07,440 --> 00:45:10,000
Speaker 1: of the you know, it's horror and big tent pole

840
00:45:10,680 --> 00:45:15,319
Speaker 1: marvel type movies. So I think those are two two

841
00:45:15,440 --> 00:45:19,200
Speaker 1: kinds of movies that are still working theatrically, Um, and

842
00:45:19,239 --> 00:45:21,040
Speaker 1: I'm happy about that. I think there you know, I

843
00:45:21,080 --> 00:45:23,600
Speaker 1: think the adult drama, I think. I think there will

844
00:45:23,680 --> 00:45:27,520
Speaker 1: be adult dramas released theatrically. But certainly it was challenged before.

845
00:45:27,520 --> 00:45:30,440
Speaker 1: It's even more challenged now. Um. So I think the

846
00:45:30,520 --> 00:45:37,759
Speaker 1: theatrical business it's going to change shape. The the you know,

847
00:45:38,080 --> 00:45:42,120
Speaker 1: with my friends and exhibition aside for a second, the

848
00:45:42,239 --> 00:45:47,960
Speaker 1: actual health of the motion picture business is excellent right now,

849
00:45:48,320 --> 00:45:55,320
Speaker 1: because the press doesn't Um report on this. Well, no offense,

850
00:45:55,840 --> 00:46:01,759
Speaker 1: um Um. The the amount of Ants Hillary value a

851
00:46:01,920 --> 00:46:08,439
Speaker 1: movie makes is almost twice what it was five years ago.

852
00:46:08,840 --> 00:46:10,160
Speaker 1: So if I have a movie that makes a hundred

853
00:46:10,200 --> 00:46:12,239
Speaker 1: million dollars, the amount of money I'm going to make

854
00:46:12,239 --> 00:46:16,040
Speaker 1: from all the ancillaries is almost equivalent to a movie

855
00:46:16,040 --> 00:46:18,880
Speaker 1: that five years ago would have been two hundred million dollars.

856
00:46:18,920 --> 00:46:20,920
Speaker 1: So even though the box office maybe off ten to

857
00:46:22,200 --> 00:46:24,880
Speaker 1: the other side of it, which is the ancillary value

858
00:46:25,000 --> 00:46:28,560
Speaker 1: of the movies that are released theatrically is almost twice.

859
00:46:29,040 --> 00:46:31,919
Speaker 1: So the overall health of the movie business, I actually feel,

860
00:46:32,000 --> 00:46:36,239
Speaker 1: is very good. Theatrical is is more challenge than it was.

861
00:46:36,680 --> 00:46:38,800
Speaker 1: That will be more challenged than it was before the pandemic.

862
00:46:39,120 --> 00:46:42,440
Speaker 1: Speaking of no, I think that's that's that's bing on.

863
00:46:42,480 --> 00:46:44,560
Speaker 1: I add a couple of things, which is you know,

864
00:46:44,840 --> 00:46:46,840
Speaker 1: we happen to know a little bit about how it

865
00:46:46,880 --> 00:46:50,279
Speaker 1: worked at studios, whom the models changed. Um, Jason, sign

866
00:46:50,320 --> 00:46:52,360
Speaker 1: of percent right. Some of that stuff you couldn't know

867
00:46:52,440 --> 00:46:55,560
Speaker 1: because it happens below the waterline. You don't know. Pivot

868
00:46:55,600 --> 00:47:00,560
Speaker 1: results are not publicly reported. Is Not is not publicly reported,

869
00:47:00,760 --> 00:47:02,640
Speaker 1: but we do. We see it, of course, because we

870
00:47:02,680 --> 00:47:05,720
Speaker 1: know how our movies are exploited in film. Studio share data.

871
00:47:06,320 --> 00:47:09,520
Speaker 1: So so you know that we're getting a lot of

872
00:47:09,560 --> 00:47:12,319
Speaker 1: tremendous values. So each dollar box office, like Jason said,

873
00:47:12,320 --> 00:47:13,960
Speaker 1: it's worth way more now, which is great for the

874
00:47:14,000 --> 00:47:16,640
Speaker 1: movies that get at theatrical release. On top of that,

875
00:47:16,960 --> 00:47:20,359
Speaker 1: we have not increase, so the studios have an increase

876
00:47:20,360 --> 00:47:22,040
Speaker 1: how much they spent on marketing. Right. So not only

877
00:47:22,040 --> 00:47:24,839
Speaker 1: are getting that return and you've you've added windows that

878
00:47:24,880 --> 00:47:28,960
Speaker 1: are earlier to your slides point that don't require extra marketing.

879
00:47:29,239 --> 00:47:31,879
Speaker 1: So the marketing is basically stayed flat. It's spread out

880
00:47:31,920 --> 00:47:34,479
Speaker 1: a little bit differently, and so you've got no real

881
00:47:34,560 --> 00:47:37,480
Speaker 1: increase in the cost side. You've got much more revenue

882
00:47:37,480 --> 00:47:40,600
Speaker 1: coming in on on the revenue side, even if it's

883
00:47:40,600 --> 00:47:43,240
Speaker 1: not all in box offic's happening below which can absorb

884
00:47:43,280 --> 00:47:45,960
Speaker 1: any reduction in theatrical pain. And then the last thing

885
00:47:45,960 --> 00:47:48,719
Speaker 1: I'd say is there's still an active, alternative way of

886
00:47:48,719 --> 00:47:51,359
Speaker 1: monetize these movies now via streaming. Right, think about where

887
00:47:51,360 --> 00:47:54,040
Speaker 1: we were three or four years ago. Like big, big

888
00:47:54,080 --> 00:47:57,320
Speaker 1: giant movies have debuted on streaming between Netflix and Amazon,

889
00:47:57,360 --> 00:47:59,880
Speaker 1: and what Sony and paramounted with their slates and peacock

890
00:48:00,040 --> 00:48:02,120
Speaker 1: and Disney plus, and so now you have an alternative

891
00:48:02,120 --> 00:48:05,560
Speaker 1: outlet that is much more robust for big theat for

892
00:48:05,600 --> 00:48:08,400
Speaker 1: big theatrical quality motion pictures that get sold to streaming.

893
00:48:08,400 --> 00:48:10,560
Speaker 1: So you put all that together into the movie studio,

894
00:48:10,560 --> 00:48:13,080
Speaker 1: you got like all right, the theatrical business has a

895
00:48:13,200 --> 00:48:16,200
Speaker 1: theatrical first release business has greater health to it because

896
00:48:16,239 --> 00:48:18,800
Speaker 1: of the economics have changed and I still have vibrant

897
00:48:18,840 --> 00:48:23,880
Speaker 1: alternatives by debuting things on streaming engines. What did it make?

898
00:48:23,920 --> 00:48:26,560
Speaker 1: Two Point six, three point one on the box office?

899
00:48:26,560 --> 00:48:29,440
Speaker 1: I think we're doing about. I think about four. Oh, four, okay, four,

900
00:48:30,320 --> 00:48:32,360
Speaker 1: I thought I did three. Actually, four, probably again, but

901
00:48:32,360 --> 00:48:33,759
Speaker 1: I thought I did like three, three and a half.

902
00:48:34,320 --> 00:48:36,880
Speaker 1: Five years ago, if we did three and three and

903
00:48:36,880 --> 00:48:38,399
Speaker 1: a half, the movie would not have broken. We would

904
00:48:38,400 --> 00:48:40,000
Speaker 1: have lost money on the movie. Now we're going to

905
00:48:40,040 --> 00:48:42,240
Speaker 1: actually make a little money on vengeance, which is amazing.

906
00:48:42,800 --> 00:48:45,080
Speaker 1: Um Um. Just to my point. But go on, what

907
00:48:45,120 --> 00:48:47,719
Speaker 1: were you gonna say? Well, but aren't there going to

908
00:48:47,840 --> 00:48:51,759
Speaker 1: be fewer movies going to theaters? And if there are,

909
00:48:52,440 --> 00:48:56,040
Speaker 1: does that work against Your Business? What do you think?

910
00:48:56,440 --> 00:48:58,960
Speaker 1: I think that there could be fewer overall, but, like

911
00:48:59,040 --> 00:49:02,600
Speaker 1: Jason said, we're lucky that our focus is in the

912
00:49:02,640 --> 00:49:05,520
Speaker 1: horror space, which is clearly one of the most resilient

913
00:49:05,600 --> 00:49:08,080
Speaker 1: genres when it comes to theatrical right people love that

914
00:49:08,160 --> 00:49:11,040
Speaker 1: experience of seeing scary movies and theaters. So there could

915
00:49:11,080 --> 00:49:13,640
Speaker 1: be fewer theatrical releases. I think that's entirely possible. That

916
00:49:13,680 --> 00:49:16,319
Speaker 1: could be a reaction. Like Jason said, adult dramas what

917
00:49:16,360 --> 00:49:18,440
Speaker 1: they used to look like in two thousand eight, two

918
00:49:18,440 --> 00:49:21,960
Speaker 1: thousand fifteen could look more. That trend was already happening.

919
00:49:21,960 --> 00:49:23,920
Speaker 1: It's been accelerated due to covid so there could be

920
00:49:23,960 --> 00:49:26,040
Speaker 1: fewer of those that come out in the world. Or

921
00:49:26,600 --> 00:49:28,600
Speaker 1: they're made at a lower cost base and they have

922
00:49:28,680 --> 00:49:30,840
Speaker 1: more targeted marketing to them. So I don't know. On

923
00:49:30,880 --> 00:49:33,960
Speaker 1: the overall volume, there will probably be some reduction in

924
00:49:34,040 --> 00:49:38,560
Speaker 1: theatrical movie going verse. Let's see, though, we're still early

925
00:49:38,760 --> 00:49:43,080
Speaker 1: in the recovery period and maybe four that could change,

926
00:49:43,120 --> 00:49:45,080
Speaker 1: but that's a fair assumption. I don't think we're the

927
00:49:45,080 --> 00:49:46,480
Speaker 1: only ones who are who are saying that. All the

928
00:49:46,520 --> 00:49:48,920
Speaker 1: analysts have a version of that. But even if there

929
00:49:48,960 --> 00:49:53,000
Speaker 1: are fewer movies, the stuff that we make has still

930
00:49:53,040 --> 00:49:55,640
Speaker 1: seems like it's doing extraordinarily well. Look at black phone

931
00:49:55,680 --> 00:49:57,480
Speaker 1: and some of the other horror movies that other studios did.

932
00:49:57,680 --> 00:50:00,719
Speaker 1: So I think from our point of view that there's

933
00:50:00,800 --> 00:50:03,520
Speaker 1: incredible health and robustness in theatrical and, like we said,

934
00:50:03,760 --> 00:50:06,280
Speaker 1: you still have all that downstream benefit. We're streaming actually

935
00:50:06,280 --> 00:50:08,840
Speaker 1: helps us make more money Um when you couple it

936
00:50:08,840 --> 00:50:10,279
Speaker 1: with bars. Yeah, the movie business is going to be

937
00:50:10,360 --> 00:50:14,040
Speaker 1: much more profitable than it's ever been before, but the

938
00:50:14,080 --> 00:50:16,600
Speaker 1: box office may not be as high as it was before,

939
00:50:16,760 --> 00:50:19,200
Speaker 1: and I would imagine there's probably gonna be some serious

940
00:50:19,239 --> 00:50:25,040
Speaker 1: shrinkage of the footprint of theaters worldwide. Some, I mean

941
00:50:25,040 --> 00:50:27,040
Speaker 1: there's definitely gonna be some shrinkage. There's two. I mean

942
00:50:27,040 --> 00:50:29,600
Speaker 1: there's too many screens. You probably know per marketing people

943
00:50:29,880 --> 00:50:32,319
Speaker 1: cerfrently have that view, like in certain markets, that there's

944
00:50:32,320 --> 00:50:34,520
Speaker 1: over screening. You see examples of it here right. Some

945
00:50:34,600 --> 00:50:36,520
Speaker 1: screens shuttered in the US over the course of the

946
00:50:36,560 --> 00:50:38,480
Speaker 1: pandemic that probably don't come back. And now you have

947
00:50:38,520 --> 00:50:41,640
Speaker 1: a center world. You know, bankruptcy process happening and probably

948
00:50:41,800 --> 00:50:45,720
Speaker 1: some of those locations don't come back. But fewer screens.

949
00:50:45,760 --> 00:50:48,920
Speaker 1: There's a lot of capacity. I think theatrical Um, you know,

950
00:50:49,000 --> 00:50:54,160
Speaker 1: exhibition has like like usage utilization, so there's still room

951
00:50:54,440 --> 00:50:56,640
Speaker 1: to gross as much as you know you need to

952
00:50:56,680 --> 00:50:59,600
Speaker 1: on any given movie. There's slightly fewer screens. So you're

953
00:50:59,640 --> 00:51:02,640
Speaker 1: bullish on theatrical. Does that mean you guys wouldn't dolish

954
00:51:02,640 --> 00:51:06,799
Speaker 1: on the movie business? Got It? So, meaning there will

955
00:51:06,840 --> 00:51:10,359
Speaker 1: be some blumhouse movies that go straight to streaming, some

956
00:51:10,440 --> 00:51:14,320
Speaker 1: that will play in theaters right, some with accelerated windows.

957
00:51:14,320 --> 00:51:17,320
Speaker 1: That two both say for the movie that did thirty

958
00:51:17,440 --> 00:51:19,520
Speaker 1: and would have done fifty will do better even though

959
00:51:19,520 --> 00:51:21,840
Speaker 1: it's only doing thirty, even though what scouts get written

960
00:51:21,840 --> 00:51:23,799
Speaker 1: about is this movie only did thirty, it would have

961
00:51:23,800 --> 00:51:26,080
Speaker 1: done sixty. But actually this movie that just did thirty

962
00:51:26,239 --> 00:51:28,279
Speaker 1: will ultimately make us more money than the one that

963
00:51:28,320 --> 00:51:30,839
Speaker 1: did sixty five years ago. Well, okay, so in the

964
00:51:30,920 --> 00:51:36,120
Speaker 1: TV business, are you feeling? I mean, five years from now,

965
00:51:36,120 --> 00:51:38,120
Speaker 1: do you think blumhouse will be known as much for

966
00:51:38,200 --> 00:51:41,240
Speaker 1: TV as it is now for film? We have success

967
00:51:41,239 --> 00:51:42,759
Speaker 1: and TV. We did that gist at the show thing

968
00:51:42,760 --> 00:51:45,000
Speaker 1: about Pam. It was a hit for peacock. But I

969
00:51:45,040 --> 00:51:50,760
Speaker 1: would like ongoing series success equivalent to our movie business success,

970
00:51:51,000 --> 00:51:53,520
Speaker 1: and we don't have that and I hope that in uh,

971
00:51:53,760 --> 00:51:56,520
Speaker 1: five years will have a few of those. Okay, I mean,

972
00:51:56,560 --> 00:51:59,400
Speaker 1: if you think about our the Jason Luton earlier, the

973
00:51:59,480 --> 00:52:02,000
Speaker 1: brand and what it's become from where it started and

974
00:52:02,000 --> 00:52:05,239
Speaker 1: how meaningful it is, I don't think any one of

975
00:52:05,320 --> 00:52:07,600
Speaker 1: us know exactly what the consumer landscapes is gonna look

976
00:52:07,640 --> 00:52:09,000
Speaker 1: like in five years. What are people going to be

977
00:52:09,040 --> 00:52:15,040
Speaker 1: spending their time on as entertainment consumers? TV series and film? Gosh,

978
00:52:15,080 --> 00:52:17,200
Speaker 1: for sure. We hope so feels like that trend like

979
00:52:17,239 --> 00:52:18,839
Speaker 1: we just talked about, would be there. But are there

980
00:52:18,840 --> 00:52:21,040
Speaker 1: other places that people spend their time? You had, you know,

981
00:52:21,080 --> 00:52:23,680
Speaker 1: a robust discussion around audio right before us and then

982
00:52:23,680 --> 00:52:25,400
Speaker 1: we joked around about it a little bit. We're in

983
00:52:25,400 --> 00:52:28,279
Speaker 1: that business too, right, we have partnership there. Um If

984
00:52:28,320 --> 00:52:31,000
Speaker 1: that's where consumers are spending more time, we can lean

985
00:52:31,040 --> 00:52:34,040
Speaker 1: into that and there's relevance for what we do storytelling

986
00:52:34,360 --> 00:52:37,359
Speaker 1: in the genre space that could extend into other formats. Right.

987
00:52:37,400 --> 00:52:40,759
Speaker 1: We are a big part of universal's Halloween or night's experience. Right.

988
00:52:40,760 --> 00:52:43,560
Speaker 1: So it's a live, location based experience. Maybe there's a

989
00:52:43,560 --> 00:52:46,279
Speaker 1: lot more that's there. And I don't know if you

990
00:52:46,560 --> 00:52:48,800
Speaker 1: guys have talked all about the metaverse. If the metaverse

991
00:52:48,800 --> 00:52:53,400
Speaker 1: starts writing checks for for storytellers and and then anybody

992
00:52:53,440 --> 00:52:55,920
Speaker 1: who's a fan of Blumhouse, and we can, we happily

993
00:52:55,960 --> 00:52:57,839
Speaker 1: will create content in that space too. So I think

994
00:52:57,840 --> 00:53:00,839
Speaker 1: we're open to taking what's been created with this brand,

995
00:53:00,880 --> 00:53:03,480
Speaker 1: this connection we have with consumers and the passion for

996
00:53:03,560 --> 00:53:05,839
Speaker 1: storytelling in that space that we've got an extending into

997
00:53:05,920 --> 00:53:08,400
Speaker 1: other areas. Certainly TV is a is a realm that

998
00:53:08,440 --> 00:53:10,279
Speaker 1: we're in right now that we want to grow. So

999
00:53:10,480 --> 00:53:15,440
Speaker 1: last question. Five years out again, what any ideas of

1000
00:53:15,440 --> 00:53:18,120
Speaker 1: what marketplace you guys will be playing in? I assume

1001
00:53:18,239 --> 00:53:22,480
Speaker 1: I'll go first. Fewer streamers will be consolidation. What else

1002
00:53:22,480 --> 00:53:24,920
Speaker 1: do you think will happen over that time? Boy, yeah,

1003
00:53:25,000 --> 00:53:27,719
Speaker 1: I mean you've already there's like a headline every day

1004
00:53:27,760 --> 00:53:30,520
Speaker 1: about other thinking about consulting operations between this streaming outlet

1005
00:53:30,560 --> 00:53:32,160
Speaker 1: and that streaming outlets. So you didn't really go out

1006
00:53:32,160 --> 00:53:37,840
Speaker 1: on a limb there. Ending UH. Yeah, I mean, I

1007
00:53:37,840 --> 00:53:40,160
Speaker 1: don't know that. To me, the biggest question are all

1008
00:53:40,160 --> 00:53:44,319
Speaker 1: these new spaces in the gaming, metaverse, short form content area.

1009
00:53:44,400 --> 00:53:46,840
Speaker 1: There seems like there's a lot of money and noise.

1010
00:53:46,960 --> 00:53:49,840
Speaker 1: I for myself have not figured out practically what that

1011
00:53:49,880 --> 00:53:53,240
Speaker 1: could look like yet, but really interested in knowing if anybody,

1012
00:53:53,280 --> 00:53:55,480
Speaker 1: if anybody does, have it. And then I do think

1013
00:53:55,480 --> 00:53:58,719
Speaker 1: there'll still be really healthy businesses for for movies and

1014
00:53:58,760 --> 00:54:02,040
Speaker 1: for for series. But that's, you know, my guess chasing up.

1015
00:54:02,600 --> 00:54:07,520
Speaker 1: They'll be sharing and streaming. That's that's my predictions. How soon?

1016
00:54:07,800 --> 00:54:12,960
Speaker 1: It's five years? I gave you five five lines. Five years. Well,

1017
00:54:13,000 --> 00:54:15,520
Speaker 1: everyone will realize that's a better model. You get better

1018
00:54:15,560 --> 00:54:18,880
Speaker 1: shows and movies at a more reasonable price. And that

1019
00:54:18,920 --> 00:54:21,319
Speaker 1: will happen and you'll get data too, and we'll get

1020
00:54:22,000 --> 00:54:24,120
Speaker 1: they can't share without sharing data, so we'll get data

1021
00:54:24,160 --> 00:54:25,920
Speaker 1: to Al Right, you guys are that's my prediction. You

1022
00:54:25,920 --> 00:54:30,320
Speaker 1: guys are gonna have to come back in again. Book Excellent.

1023
00:54:30,400 --> 00:54:46,240
Speaker 1: Thanks for coming in, you guys. This has been another

1024
00:54:46,280 --> 00:54:49,400
Speaker 1: episode of strictly business. Tune in next week for another

1025
00:54:49,400 --> 00:54:53,279
Speaker 1: helping of scintillating conversation with media movers and shakers, and

1026
00:54:53,320 --> 00:54:55,560
Speaker 1: please make sure you subscribe to the podcast to hear

1027
00:54:55,640 --> 00:54:59,640
Speaker 1: future episodes. Also, leave a review in apple podcast. Let

1028
00:54:59,719 --> 00:55:01,440
Speaker 1: us oh how we're doing. E