Michael Burns: Lionsgate Focused on Catalog Acquisitions as Well as Original Content Spending

In the crush of original content production across studios and streaming platforms, Lionsgate has taken a slightly different path, focusing equally on catalog library acquisitions, in addition to original TV shows and movies.

The Santa Monica, Calif.-based studio/distributor this year acquired three separate movie libraries, including a 20% stake in Spyglass Media Group, securing distribution rights to more than 200 movies and most of the The Weinstein Co. library. Lionsgate also owns stakes in Trimark Pictures, Artisan Entertainment and Summit Entertainment.

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“The ability to buy these libraries when everybody else is standing still, that’s a strategic advantage,” Michael Burns, chairman of Lionsgate, told an investor group.

Speaking Sept. 21 at the virtual Goldman Sachs Communacopia Conference, Burns said Lionsgate has spent $20 billion on content over the past 20 years — much of it on third-party libraries. The company generated in excess of $700 million in revenue on catalog content in 2020.

“The [movie] license business ages extremely well,” Burns said. “We have all the Weinstein product from 2005 to 2018. We’re the largest holder of Quentin Tarantino movies now. We have an opportunity right now to monetize library product like never before. It’s a terrific time to be in the content business.”

Burns said that in addition to SVOD, the burgeoning ad-supported VOD and FAST streaming platforms in the U.S. (i.e. Pluto TV, Tubi, The Roku Channel, etc.) and worldwide has created new distribution opportunities.

“AVOD has turned out to be a great business for us, domestically, as all these players emerge. And they just opened internationally,” he said.

On the conference call, Jeffrey Hirsch, CEO of Starz, said the premium channel is now generating more revenue from digital distribution than pay-television. Linear and streaming now account for 30 million combined subscribers.

“The brand’s streaming platforms are now operating in 59 countries outside the U.S.,” Hirsch said. “We think we are really positioned to capture market share outside the U.S.”

Meanwhile, at a time when industrywide consolidation sees Amazon acquiring MGM and Discovery taking control of WarnerMedia, Lionsgate remains a prime target for third-party acquisition. In the last earnings call, CEO Jon Feltheimer said the company would not be distracted by industrywide “concept of scale,” while at the same time remaining open to discussions with “everyone” and listening to “everything.”

The reality is not lost upon Burns.

“We expect to see more consolidation in the media sector,” he said. “That’s a given. We are one of the last big independent media companies. Our size allows us to be nimble. We are the PT boats surrounded by battleships. We are going to continue to identify ways to increase the value of our stock price.”

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