Warner Archive Celebrates 10th Anniversary

The Warner Archive Collection, the manufacture-on-demand arm of Warner’s home video unit, last month celebrated its 10th anniversary — but its reach spans decades.

Since its first collection of 150 titles released in March of 2009, Warner Archive has navigated a host of changes in home entertainment business models and formats while releasing catalog titles on MOD from every decade and for every taste.

“Whether it’s Bogart and Bacall or whether its Hitchcock or Hammer horror films or Busby Berkeley films, we’re releasing something for everyone,” said George Feltenstein, SVP of theatrical catalog marketing at Warner Bros. Home Entertainment, who heads up the unit.

It’s also generated well in excess of $100 million in revenue for the studio over the years.

Manufacturing on demand is a process by which a disc is created when a consumer orders it, offering consumers access to titles that don’t have the kind of demand that supports a traditional pressing.

The kernel of the idea for its use in home video entertainment came from Warner’s Jim Wuthrich (currently president of worldwide home entertainment and games), Feltenstein recalled.

Feltenstein had been working on a joint venture with Rhino Records for soundtracks in 2002 and 2003 under a label called Handmade. “They would produce 2,500 units of albums that were aimed at collectors, and when they were sold out, they were sold out,” he said. “And it was a profitable way of getting niche content out to the consumer. You could only buy it online.

“So Jim saw the CDs in my hand and he asked me about them, and I explained the business model, and he said, ‘That’s fascinating. I have to figure out a way that we can get our deeper library titles out on DVD.’”

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MOD turned out to be the ticket, and several years later, with the help of Allied Vaughn, Warner Archive on March 23, 2009, released its first MOD collection.

“To my knowledge, [MOD] didn’t exist in our world, meaning the Hollywood studio world,” Feltenstein said. “We were the first studio to do this. Nobody had ever done it before.”

That first collection of 150 titles on DVD included some starring the legendary Debbie Reynolds, a “dear friend” of Feltenstein’s.

“On the morning of the 23rd, Debbie Reynolds was in New York on ‘The Today Show’ announcing the launch of the Warner Archive Collection,” Feltenstein said.

“She explained what it was and that some of her films were part of the initial offering. And then that night I did something that I used to do every year and had done for about 11 or 12 years at that time. We would have a yearly chat on the Home Theater Forum, which was and still is a fan site.”

During the chat, Feltenstein tried to allay any fears about the quality of the MOD discs. Warner Archive also had been careful to provide the proper aspect ratio (no pan-and-scan cutting out part of the picture).

“People were very excited, but to be fair there was also some trepidation,” he said. “There was concern about that fact that these were manufactured on demand, and people thought that DVD-Rs were not … they thought that manufactured on demand was similar to burning a disc on your computer, and it’s just not. It’s a fuller technology. The DVD-Rs and the process we went through was a much higher quality, so eventually — and it took a long time — eventually we gained consumer confidence, and now that it’s been 10 years, I’ve noticed people posting on the sites, ‘I have Warner Archive discs that are nine, 10 years old, and I’ve had no problems with them.’”

Those chats would soon lead to podcasts, all available on iTunes, and appearances at such fan confabs as Wondercon and Comic-con at which Feltenstein and staff would talk about upcoming releases and interview stars and directors from the Golden Age of Hollywood and beyond.

Those first 150 releases included such classic features as Mr. Lucky with Cary Grant and Laraine Day, The Enchanted Cottage with Robert Young and Dorothy McGuire, Abe Lincoln in Illinois with Raymond Massey, Edison the Man with Spencer Tracy, and Private Lives with Norma Shearer and Robert Montgomery, but also included more recent films such as Kaleidoscope with Warren Beatty, Oxford Blues with Rob Lowe and Wisdom with Emilio Estevez and Demi Moore.

The collection included “a lot of really good films that just hadn’t made their way to DVD and when you’re dealing with the wonderful incredible library that we’re so blessed to have, you know it’s an embarrassment of riches, and the response was tremendous,” Feltenstein said.

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As the catalog business waned at traditional retailers, Warner Archive was able to offer more and more classic titles via MOD — assisted by the technology to offer dual-sided discs and eventually Blu-ray Disc.

The kind of content expanded as well, beyond feature films.

“We have 3,250 releases on our docket as of now,” Feltenstein said. “We started with feature films only. We expanded into made for television movies, and we eventually were able to start adding television series.”

Warner Archive’s quest for more, deep library content also pushed preservation at the studio.

“Eventually we got to the point where we were confronted with the fact that masters on the shelf were starting to run out, that we would need to start creating new masters if we wanted to maintain our quality standard, and our standard of making sure we had original aspect ratio, and so forth,” Feltenstein noted.

Thus, a side product of Warner Archive was preservation of content that could have languished and deteriorated on the shelf.

“Our first remastered releases came out in June of 2010, basically 15 months after launch,” he said.

Eventually, most of the other studios caught on to MOD, but none had a unit like Warner Archive, Feltestein said.

“I like to refer to it as the boutique within the behemoth,” he said. “We have a very small dedicated staff, very engaged with consumers.”

Those consumers add up to a profitable business for Warner.

“It may be a smaller group of people, but there is still a rabid fan base out there for all sorts of content where people want to own things, and we’re trying to take advantage of that in a profitable way, listening to fans, watching sales,” Feltenstein said.

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.

Four Brits Sentenced to Multiyear Jail Terms for Illegally Streaming Hollywood Movies

Four British men have been sentenced a combined 4.5 years jail time for operating a website that afforded users illegal access to Hollywood movies, including Lionsgate U.K.’s The Expendables 3, before they were available in theatres.

Prosecutors say the group – which included Steven Pegram (40), Mark Rollin (37), Paul Taylor (54), and Alan Stephenson (42) — defrauded Lionsgate, Warner Bros., 20th Century Fox and other studios of more than $11 million in combined box office revenue, according to the Motion Picture Association of America.

Specifically, the group hacked Lionsgate’s U.K. server in 2014 through a third-party cloud-based content management service, accessing The Expendables 3 DVD screener and other content and then posting the title on their file-sharing website, TheFoundry.name.

Lionsgate estimates it lost about $2 million on the scheme. Other hacked titles included Warner Bros.’ Godzilla and 20th Century Fox’s X-Men: Days of Future Past — the two movies suffering more than $5 million in lost revenue.

“These defendants set up and ran a site which allowed users to download films for free via BitTorrent, including the Expendables 3 before its release in the cinema,”Leigh Webber, with the specialist fraud division of the U.K.’s Crown Prosecution Service, said in a statement.“All of them had a clear knowledge of what the site was used for and were well aware they were breaching the copyright of the production companies.”

The Expendables 3, the last installment in Sylvester Stallone’s ensemble action franchise, resulted in numerous litigation settlements between Lionsgate and pirate sites, including Hulkfile, Played.to, LimeTorrents, Dotsemper and Swankshare.

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.”

Warner Bros. Re-Releasing Christopher Nolan’s ‘Dark Knight’ Movies on Imax Screens

In honor of the 80th anniversary of the first published appearance of the Batman comic in May 1939, Warner Bros. March 13 began selling tickets to special Imax screenings for all three movies from director Christopher Nolan’s “Dark Knight” trilogy featuring Christian Bale as the masked crusader.

Moviegoers who acquire tickets for all three films receive a lanyard and special “Dark Knight” Trilogy collectible.

Christopher Nolan directs Christian Bale and Tom Hardy in ‘The Dark Knight Rises.’

On March 30, the films — 2005’s Batman Begins, 2008’s The Dark Knight and 2012’s The Dark Knight Rises— will screen back-to-back at the Universal Cinema AMC in Los Angeles. During an interlude between the second and third films, Nolan will join the audience for a moderated Q&A discussion on the movies.

On April 13, the three films will screen at AMC Lincoln Square in New York and AMC Metreon in San Francisco, followed by Cinesphere Ontario Place, Toronto, and Imax Theatre at the Indiana State Museum, Ind., on April 20, each accompanied by the footage of Nolan’s Los Angeles appearance.

In all five cities, all three movies will be seen in the director’s preferred 70mm format, providing an all-encompassing moviegoing experience.

Nolan with The Dark Knight (with Heath Ledger as The Joker) was the first director to shoot action sequences of a major feature film with Imax cameras, revolutionizing the integration of Imax and standard formats. He utilized Imax cameras more extensively in The Dark Knight Rises.

Heath Ledger as The Joker in ‘The Dark Knight.’

“Christopher Nolan broke new ground with the ‘Dark Knight’ Trilogy, and this is a rare chance for today’s audiences to experience these extraordinary films as they were meant to be seen,” Jeff Goldstein, president, domestic distribution, Warner Bros. Pictures, said in a statement. “To have the added privilege of hearing Chris’s insights firsthand makes this a once-in-a-lifetime opportunity.”

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.

 

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.

 

Appeals Court Denies DOJ Bid to Block AT&T’s $85 Billion Time Warner Purchase

A federal appeals court Feb. 26 ruled against the Justice Department’s attempt to block AT&T’s $85 billion acquisition of Time Warner, which led to the formation of WarnerMedia.

The court found that a lower court judge’s decision last summer approving of the transaction did not violate antitrust guidelines.

“The judgment of the district court appealed from this cause is hereby affirmed,” the court wrote in its ruling.

The Justice Department had argued that the merger would enable AT&T, which also owns DirecTV, to leverage its stake in the satellite operator to force pay-TV competitors to pay more for content from Warner Bros., HBO and Turner, which includes CNN.

Some observers speculated the government’s attempt to block the deal revolved more around President Trump’s openly hostile approach to CNN, which he has labeled “fake news,” and, along with other media outlets not named Fox News, an “enemy of the people.”

Indeed, the DOJ’s legal challenges represented the first to a corporate vertical merger in four years.

 

AT&T Eyeing HBO, Warner Content for AVOD Distribution

AT&T currently markets standalone over-the-top video services DirecTV Now and Watch TV — the latter offering mobile access to 30 pay-TV channels for $15 monthly and no long-term contract.

Watch TV has generated about 500,000 subscribers since its debut last June. DirecTV Now, which jettisoned more than 260,000 subs after ending promotional pricing late last year, has about 1.6 millions subs.

The telecom now appears to be considering ad-supported VOD — long a stepchild to subscription streaming VOD service such as Netflix, Amazon Prime Video and Hulu.

With Amazon subsidiary IMDb.com launching a free ad-supported VOD service, Hulu’s basic SVOD plan featuring commercials, and Comcast launching AVOD for Xfinity subscribers in 2020, AT&T is pondering ad-supported distribution for select content from subsidiary WarnerMedia.

Speaking on the Jan. 30 fiscal call, CEO Randall Stephenson reiterated that companies with “very strong” IP, “deep libraries” of IP are the ones that are going to succeed over time.

He said Warner Bros. CEO Kevin Tsujihara and WarnerMedia boss John Stankey have been analyzing optimal distribution channels and license opportunities for content.

Tsujihara helped craft the recent non-exclusive license extension with Netflix for “Friends,” a deal that lets WarnerMedia stream the venerable sitcom through its pending SVOD service launching later this year.

Stephenson said WarnerMedia content would be targeted toward what he called “two-sided” business models that include SVOD and AVOD.

“There’s a demand and the customers have become accustomed to advertising free subscription services,” he said. “And we think HBO and a lot of the Warner content [is] premium content will fit into that mold.”

While Stephenson didn’t reveal AVOD specifics, he said the recent acquisition of Xandr to help sell targeted digital advertising to AT&T’s 170 million mobile and broadband subscribers, underscored opportunities for advertising-supported models that help keep content (i.e. catalog) prices down, keep consumer costs down and help fund additional content acquisition and purchasing.

“Xandr is a big part of making that model work,” he said. “So, our model will be a two sided model, with a heavy subscription service, with some ad-supported elements to it as well.”