Early Home Video Access for the 1% Crowd — Without the Industry Angst

Flush with cash from Trump’s tax cut, the ultra-wealthy can now access new-release theatrical releases in the home — for $1,500 to $3,000 a title.

Upstart Red Carpet Films has entered the controversial premium video-on-demand market offering consumers willing to pay almost anything to rent (for 36 hours) Shazam! or Godzilla: King of the Monsters day-and-date with their theatrical debut.

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Studios such as Warner Bros., Paramount Pictures, Lionsgate, Disney’s 20thCentury Fox and Fox Searchlight, among others, are on board the concept that requires consumers submit to a background check and purchase a $15,000 set-top box rigged with anti-piracy controls.

Disney (a big proponent of the 90-day theatrical window), Sony Pictures and Universal Pictures are not on board. Exhibitors apparently remain unconcerned about the targeted demo.

Fred Rosen

The brainchild of Fred Rosen, founder of Ticketmaster and Dan Fellman, who retired from Warner Bros. in 2015 after a 40-year career in distribution, Red Carpet Films claims it can deliver studios about $300 million in incremental revenue from as few as 4,000 wealthy customers.

Investment firm Charles Schwab considers anyone in possession of at least $2.4 million in net value wealthy. Nationwide, households earning at least $390,000 annually are considered to be in the 1% of earners. That requisite figure increases significantly in 12 states, including Connecticut, California, New York, and Texas.

“Every product I can think of has a luxury version, which got me thinking … why not movies?” Rosen told The New York Times.

It’s not an original business model. Best Buy in 2013 toyed with a business (CinemaNow) that charged consumers $500 for early home video access, in addition to related equipment charges.

Recently, Screening Room (from Napster founder Sean Parker) promised early in-home access (priced from $30) despite exhibitor pushback. Universal, in 2011, tried offering actioner Tower Heist early in the home – a strategy that was quickly shelved when exhibitors refused to carry the movie.

Of course, Netflix has long pushed in-home access to its original movies concurrent with any theatrical screenings.

While Lionsgate chairman Michael Burns promised studios would embrace premium VOD last year – a movement pushed as well by former Warner Bros. chairman Kevin Tsujihara – the concept now appears DOA.

Dan Fellman

Fellman says Red Carpet has worked with studios instead of placing demands.

“They appreciated that,” he said. “What doesn’t work in Hollywood is going in and wagging a finger and saying, ‘This is how it’s going to be.’”

NATO Boss Chides Press for Streaming Video Focus

NEWS ANALYSIS — Helen Mirren may have gotten the most attention at this week’s CinemaCon confab in Las Vegas for her snarky, “I love Netflix, but f*** Netflix,” comment.

But for John Fithian, president of the National Association of Theater Operators, media attention to over-the-top video and home entertainment is no laughing matter. Fithian reportedly told reporters that continued attention to streaming undermines success at the global box office, which topped $41.7 billion in 2018 – up 32% since 2010.

NATO president John Fithian

“There’s no doubt that home entertainment consumption moves toward streaming [from disc] more with each passing day,” Fithian told attendees. “How does any given movie stand out among endless choices in the home? A robust theatrical release provides a level of prestige that cannot be replicated.”

He cited a study conducted by Ernst & Young that found consumers who frequent movie theaters consume more streaming video in the home.

“Streaming and theatrical don’t just co-exist, they reinforce each other,” Fithian said.

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Of course the executive was channeling Netflix, which didn’t attend CinemaCon, but whose looming industry presence continues to undermine the theatrical window releasing movies into streaming channels concurrent with any cinema exhibition.

The practice has roiled exhibitors in the U.S. and France, which have boycotted Netflix movies and challenged its award nominations, notably at the Cannes Film Festival. Regardless, the Motion Picture Association of America recently accepted Netflix among its studio members.

Indeed, Netflix is hardly the only streaming threat. With Disney, WarnerMedia and Comcast set to launch branded SVOD platforms, direct-to-consumer distribution and original content remains a threat — a reality Disney CEO Bob Iger has taken steps to address by insisting the perennial domestic box office leader will remain faithful to the theatrical window.

“We have a studio that is doing extremely well and a [release window] formula that is serving us really well in terms of its bottom line,” Iger said on last November’s fiscal call.

With Kevin Tsujihara out at Warner Bros., efforts to release studio films early into homes through premium VOD are likely over.

Tsujihara, who was forced out following a sex scandal, was initially promoted to the chairman position in large part because of his expertise advocating for alternative distribution channels while heading Warner Bros. Home Entertainment.

WarnerMedia Creating Diversity/Inclusion Executive Position

WarnerMedia is set to create a new executive position focusing on diversity and inclusion issues. While no one has yet been hired to become the former Time Warner company’s first chief diversity and inclusion officer, the move was reportedly outlined in a March 20 staff memo from CEO John Stankey.

“During the Global Town Hall meeting [last September], I was asked about the lack of women and diversity on stage,” wrote Stankey. “I understand how important this is. In order for WarnerMedia to be the best company we can be, we have to include diverse voices at every level of our business. And while we already have some of the most talented women and diverse executives in the industry, we have more work to do.”

The chief diversity and inclusion officer will report directly to Stankey.

John Stankey

The new executive position follows restructuring among WarnerMedia, that has seen bosses at Warner Bros., HBO and Turner depart — including the former’s CEO Kevin Tsujihara exit March 18 following a story in The Hollywood Reporter about his affair with actress Charlotte Kirk.

Warner Bros. is now headed by an interim management team consisting of Toby Emmerich, Warner Bros. Motion Picture Group chairman, Peter Roth, Warner Bros. Television Group president and CCO; and CFO Kim Williams.

“There is no silver bullet to get us to where we need to be, but the leaders across our company are committed to working together to make the changes necessary as we build on our foundation towards greater progress,” Stankey wrote. “I believe that our new structure will enable us to do even more to achieve these objectives.”

 

 

WarnerMedia Names Interim Warner Bros. Management Team Following Tsujihara Ouster

Kim Williams

WarnerMedia has named an interim management team to run Warner Bros. following the March 19 departure of studio chairman/CEO Kevin Tsujihara, who left following allegations of sexual impropriety with a young actress.

Peter Roth

The team consists of Toby Emmerich, chairman of the motion pictures group, Peter Roth, CCO and president of Warner Bros. Television, and CFO Kim Williams, according to Variety, which cited sources familiar with the situation.

The team will run daily operations at the studio while WarnerMedia CEO John Stankey seeks a new studio boss. Media reports have suggested Stacey Snider, outgoing CEO at 20th Century Fox Film Corp., as a possible candidate.

Toby Emmerich

Tsujihara’s exit comes following a second internal investigation into allegations the CEO secured screen roles and auditions for aspiring actress Charlotte Kirk, with whom the married executive had an affair.

Details of the 6-year-old affair — including text messages — were made public by The Hollywood Reported earlier this month.

 

 

Tsujihara Out at Warner Bros.

Kevin Tsujihara is stepping down as chairman and CEO of Warner Bros. Entertainment amid allegations of sexual improprieties.

“Over the past week and a half, I have been reflecting on how the attention on my past actions might impact the company’s future. After lengthy introspection, and discussions with John Stankey over the past week, we have decided that it is in Warner Bros.’ best interest that I step down as chairman and CEO,” said Tsujihara in a statement reported by Variety, adding, “My continued leadership could be a distraction and an obstacle to the company’s continued success.”

“It is in the best interest of WarnerMedia, Warner Bros., our employees and our partners for Kevin to step down as chairman and CEO of Warner Bros.,” WarnerMedia CEO John Stankey said in a statement, according to the Variety report. “Kevin has contributed greatly to the studio’s success over the past 25 years and for that we thank him. Kevin acknowledges that his mistakes are inconsistent with the company’s leadership expectations and could impact the company’s ability to execute going forward.”

Stankey stated an interim leadership plan would be announced to staff March 19.

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Tsujihara March 8 had issued an email apology to staff members for his behavior regarding allegations he was having an extramarital affair with aspiring actress Charlotte Kirk, and that he helped her land roles and auditions to keep the tryst secret.

The affair, which reportedly occurred shortly after Tsujihara became studio chief in 2013, was disclosed March 6 by The Hollywood Reporter.

The story prompted Warner Bros. parent company WarnerMedia, the AT&T subsidiary created in the wake of its $85 billion acquisition of Time Warner, to re-open an investigation into Tsujihara regarding the allegations. A WarnerMedia management shuffle March 4, just prior to the article, had Tsujihara taking on additional duties at WarnerMedia involving programming for children and young adults.

“I deeply regret that these personal actions have caused embarrassment to the company and to all of you,” Tsujihara wrote in the March 8 email. “I realized some time ago you are right to expect more from me and I set a course to do better.”

Kevin Tsujihara Apologizes to Warner Staff for ‘Mistakes’ in Personal Life

Kevin Tsujihara, chairman and CEO of Warner Bros., March 8 issued an email apology to staff members for his behavior regarding an extramarital affair and allegations he helped aspiring actress Charlotte Kirk land roles and auditions to keep the tryst secret.

Tsujihara, who had his duties at WarnerMedia recently expanded following a management shuffle, is under investigation by the media company created following AT&T’s $85 billion acquisition of Time Warner.

Specifically, the affair, which reportedly occurred shortly after Tsujihara became CEO of Warner Bros. in 2013, was disclosed March 6 by The Hollywood Reporter.

“I deeply regret that these personal actions have caused embarrassment to the company and to all of you,” Tsujihara wrote in the email. “I realized some time ago you are right to expect more from me and I set a course to do better.”

The CEO said he would fully cooperate with WarnerMedia and a third-party law firm reviewing the situation.

“Please don’t let my mistakes become a distraction,” Tsujihara wrote.

 

WarnerMedia Re-Opens Tsujihara Inquiry Regarding Inappropriate Behavior

WarnerMedia has re-opened an internal investigation involving Kevin Tsujihara, chairman and CEO of Warner Bros., regarding allegations he traded sex for auditions with an aspiring actress.

Tsujihara, the former home entertainment executive who became CEO of Warner Bros. in 2013 when the studio was owned by Time Warner, had been previously investigated for inappropriate behavior involving British actress Charlotte Kirk.

That investigation reportedly found no inappropriate influence by Tsujihara. Kirk did land small roles in How to be Single (2016) and Ocean’s 8 in 2018, in addition to auditions for other Warner movies.

When details of the affair, including efforts by Tsujihara, director Brett Ratner and business partner James Packer to placate Kirk were made public March 6 by The Hollywood Reporter, WarnerMedia re-opened the investigation.

“Whenever we receive new allegations, it is our standard practice to conduct an appropriate investigation. And that is what we will do here,” a WarnerMedia representative said in a media statement.

Lawyers for both Kirk and Tsujihara deny the CEO exerted any preferential treatment or pressure on behalf of the actress.

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The inquiry comes as Tsujihara had his role at WarnerMedia expanded to include oversight of Cartoon Network, Adult Swim, Boomerang, Otter Media, Turner Classic Movies and WarnerMedia’s licensed consumer products.

Indeed, Tsujihara’s long history in digital content distribution dates back to the dotcom era where he spearheaded Warner’s short-lived Entertaindom platform.

In an interview 10 years ago, Tsujihara questioned traditional distribution in a rapidly evolving digital age. He pushed for early electronic sellthrough movie release dates ahead of DVD, arguing EST margins were better than packaged-media’s cash cow status. And he advocated for early access to theatrical movies in the home at a premium price, otherwise known as PVOD.

It’s a progressive mindset that over time convinced Time Warner CEO Jeff Bewkes to put Tsujihara in charge of Warner Bros., arguing his digital vision and recognition of alternative distribution channels outweighed the status quo at the venerable film studio.

A legacy Tsujihara nurtures to this day spearheading stacking rights of Warner TV content to distribution partners across the ecosystem.

“At Warner Bros., what we want to do is take the show and put it on the most appropriate platform,” Tsujihara told Deadline.com in an interview.

Tsujihara was a big supporter of the studios banding together to create a digital storage locker for movies, first championing UltraViolet and later joining the other majors, sans Paramount, in Movies Anywhere — a platform that links to seven online retailers, including iTunes, Amazon Instant Video, Vudu, Comcast’s Xfinity Store, Google Play, Microsoft Movies & TV and FandangoNow.

In an interview last month with the Los Angeles Times, Tsujihara reiterated continued support for PVOD, despite the fact most exhibitors and Wall Street analysts consider it a failed venture.

“It’s about finding the right platform for the content,” he said. “If consumers want to be able to experience [a movie] in the home sooner, then they should have that. That’s where we’d like to see the movie business go.”

Kevin Tsujihara: A Misplaced Asset at WarnerMedia

As the dust settles from WarnerMedia’s management shuffle, with former NBC Universal executive Bob Greenblatt assuming chairmanship of the media company’s entertainment unit, including budding over-the-top video – Kevin Tsujihara, chairman/CEO of Warner Bros., expanded his duties to include – consumer products?

It’s an odd career move for Tsujihara, whose long history in digital content distribution dates back to the dotcom era where he spearheaded Warner’s short-lived Entertaindom platform.

In an interview 10 years ago, Tsujihara questioned traditional distribution in a rapidly evolving digital age. He pushed for early electronic sellthrough movie release dates ahead of DVD, arguing EST margins were better than packaged media’s cash cow status. And he advocated for early access to theatrical movies in the home at a premium price, otherwise known as PVOD.

It’s a progressive mindset that over time convinced Time Warner CEO Jeff Bewkes to put Tsujihara in charge of Warner Bros., arguing his digital vision and recognition of alternative distribution channels outweighed the status quo at the venerable film studio.

A legacy Tsujihara nurtures to this day spearheading stacking rights of Warner TV content to distribution partners across the ecosystem.

“At Warner Bros., what we want to do is take the show and put it on the most appropriate platform,” Tsujihara told Deadline.comin a March 4 interview.

Tsujihara was a big supporter of the studios banding together to create a digital storage locker for movies, first championing UltraViolet and later joining the other majors, sans Paramount, in Movies Anywhere  – a platform that links to seven online retailers, including iTunes, Amazon Instant Video, Vudu, Comcast’s Xfinity Store, Google Play, Microsoft Movies & TV and FandangoNow.

In an interview last month with the Los Angeles Times, Tsujihara reiterated continued support for PVOD, despite the fact most exhibitors and Wall Street analysts consider it a failed venture.

“It’s about finding the right platform for the content,” he said. “If consumers want to be able to experience [a movie] in the home sooner, then they should have that. That’s where we’d like to see the movie business go.”

Regardless, as WarnerMedia readies a branded OTT platform, Tsujihara is tasked with creating consumer product opportunities for Cartoon Network, Adult Swim, Boomerang, Otter Media and Turner Classic Movies, among others.

“The lion’s share of their profitability comes from affiliate sales and advertising,” he told Deadline. “So a vertically integrated entity would say, ‘How can we drive more consumer products revenue from these properties?’”

Apparently Tsujihara is looking forward to the vertical challenge – one not unprecedented in home entertainment. Former Disney home entertainment executive Bob Chapek transitioned to consumer products following years of peddling home video.

Now he’s chairman of parks and resorts since 2015 and considered by some Disney’s next CEO when Bob Iger retires.

Maybe Tsujihara is on to something.

 

Bob Greenblatt Named Chairman of WarnerMedia’s Entertainment Unit; Kevin Tsujihara’s Role Expanded

As expected, AT&T March 4 named former NBC Universal executive Bob Greenblatt chairman of WarnerMedia’s entertainment and over-the-top video businesses. Greenblatt reports to WarnerMedia CEO John Stankey.

Greenblatt, who left NBC Universal six months ago, joins the former Time Warner company following last week’s exits of HBO boss Richard Plepler and Turner’s David Levy.

Greenblatt oversees HBO, TNT, TBS, truTV, and the company’s over-the-top video business. Kevin Reilly remains in charge of Turner programming, in addition to spearheading WarnerMedia’s pending streaming video service.

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Meanwhile, longtime home entertainment executive Kevin Tsujihara remains chairman/CEO of Warner Bros., while adding responsibilities involving children and young adult viewers.

Specifically, Tsujihara will now also oversee Cartoon Network, Adult Swim, Boomerang, Otter Media, Turner Classic Movies and WarnerMedia’s licensed consumer products.

CNN president Jeff Zucker adds the title chairman of WarnerMedia news and sports, while Gerhard Zeiler transitions from president of Turner International to chief revenue officer at WarnerMedia.

“We have done an amazing job establishing our brands as leaders in the hearts and minds of consumers,” Stankey said in a statement. “Adding Bob Greenblatt to the WarnerMedia family and expanding the leadership scope and responsibilities of Jeff, Kevin and Gerhard — who collectively have more than 80 years of global media experience and success — gives us the right management team to strategically position our leading portfolio of brands, world-class talent and rich library of intellectual property for future growth.”

Report: Warner’s Tsujihara Still Keen on Premium VOD

Warner Bros. Entertainment Chairman and CEO Kevin Tsujihara again pushed the idea of early home access for consumers that want theatrical movies sooner — oft termed premium VOD.

“Clearly we want the theatrical experience to continue and to maintain that incredible social experience,” he told the Los Angeles Times Feb. 27, noting that Crazy Rich Asians “got into the zeitgeist,” which is “very difficult to do on a streaming service.”

But he said that early home access is part of the evolution of content delivery.

“If consumers want to be able to experience it in the home sooner, then they should have that option as well,” he said. “That’s where we’d like to see the movie business go.”

As far as the new direct-to-consumer streaming service coming from parent company AT&T, Tsujihara told the Times that the studio’s content will go to that platform as well as linear, current customers.

“It’s about finding the right platform for the content,” he told the Times. “Some will go to HBO, some will go to Turner, some will go to Netflix, and other streaming platforms, and some will go to the direct-to-consumer platform.”

He also commented on the promise of 5G.

“It actually could have a significant impact on our ability to deliver content,” he told the Times.

He said 5G would “turbocharge” the ability to deliver VR and AR experiences.