Boy what a whirlwind this week has been – AMC/Universal, Mulan, TikTok, Beirut! Of course, we could say that every week. But narrowing in to the media part, and with the Orange man demanding his “key fee” for knee-capping TikTok in the forced delivery to Microsoft, because “supposedly” China, but more likely Tulsa, and American’s just crying about it and shrugging…I gotta write something about this before I unplug completely for August. That’s right – most readers know I’ve been on social media vacation since June 4^th, but starting on August 1, I typically stop writing the newsletter and completely unplug except for some client emergency work.
 
We’ll get back to TikTok, but first – and relatedly, believe it or not – Last week’s big news was the AMC-Universal deal, which has of course spun everyone into a tizzy in the traditional film world. Egads! The collapsing of windows! This is the end of cinema as we know it! A “kick in the shorts” to indies! “ We do not see any business sense in this model.”
 
Perhaps only one person stayed sane – Christopher Escobar of the Plaza Theater and Atlanta Film Festival (my old remit) –
““We need a revolution,” he said. Escobar isn’t worried that some movies might be available on-demand sooner. [..] “I’m already operating differently,” Escobar says. “I do everything I can as an owner to make going to the movies feel like an occasion.””

Thanks for the sanity, Christopher. Let’s put this in perspective. Theaters were already struggling BC. Now, DC (during corona; who knew we wouldn’t get to AC in the US?!) theaters are on the ropes. Even the arthouses are in trouble, but the big chains were even more endangered. AMC was among the hardest hit. Then AMC makes a deal where it plays films in their most lucrative window (the first two weeks make up about 80% of revenues), gets an extra 2% of that box office (huge numbers with Hollywood blockbusters), and also get to put the films on its own PVOD service for members – whose data it owns, before their audience forgets the film exists, and also gets a reported 20% cut of the overall PVOD from every other platform Universal sells on. And they make it clear that it’s only for certain titles, not every film.

This is somehow a bad deal? It’s exactly the only deal that would ever work for all parties. And because AMC did it first, they’ll get better terms than the other exhibitors. AMC gave itself a chance to survive in the new world of film, as exposed brightly by covid, but that was coming regardless. What will happen next? Well, for AMC, I’m betting that Comcast – owner of Universal – waits about one year, and then buys them. There’s speculation out there that Comcast also invested in AMC as part of the deal. The government has already signaled that it is getting rid of the antitrust laws that stop studios from owning theaters (1948 Paramount decrees). AMC will get cheaper as time goes on – not because of this deal, but because US audiences won’t be returning in droves anytime soon, due to Trump’s bungling of Covid (other countries will rebound quickly, and already are successfully re-opening in certain locales). Comcast can then take advantage of the AMC real-estate to not just show movies, but also sell merchandise from Universal films, sell cable, and expand its ancillary businesses. AMComcast (ok, it will more likely just be Comcast Cinemas).

Indie theaters, if they’re paying attention at all, are worried about everyone thinking all movies should be just 17 days, or that they won’t get Universal films, or that people will just stay home. But guess what – that was already the case. This would be the time for the indies to band together – maybe via AHC – and build their own joint membership and SVOD/TVOD platforms and make deals with distributors to also share in PVOD revenues, in exchange for promoting films earlier. Distributors save on P&A (which in theory helps filmmakers as well), theaters get cut in to a more lucrative revenue stream while also having their own platforms, and audiences get what they want. Will this happen? Don’t bet on it, but as Escobar says above – we need a revolution. Let’s use this to start it.

Then, after writing all of the above, I have to update this post now in light of the Mulan announcement – Mulan Mayhem! – which made AMC/Universal look tame. Sure, Disney says this $30 premium (on top of your Disney+ subscription) is a one-time experiment. And it will be…until it works. With the rest of the world recovering from coronavirus faster than the US, and accounting for so much more revenue for most films, it seems that opening in theaters overseas and PVOD in the US is the only rational way forward. I know my household, without kids, would pay more than $30 to watch Tenet right now, and I bet most of America would be right behind us. And then we’d pay to see it on the big screen again come 202…2(?) if it’s as good as it should be. How this common sense doesn’t permeate the popcorn fumes into theater owner’s minds is beyond me. If theaters want to even be part of this revolution, they better start exploring new business models seriously before they aren’t even in the picture anymore.

Meanwhile, the public is saying – IDGAF! Just save my TikTok. The absurdity of folks debating a 17 day window when all anyone – and I mean anyone, whatever their age – wants to do is get instant gratification from TikTok, while the entire movie industry ignores it is indicative of the field’s collective sticking of their heads in the quicksand. As I wrote last week – we’ve got a superabundance problem, and the only way to address it is to become more relevant, which by definition does not include a term called “windowing.” The film industry, especially indies, are practically absent from the platform, if they even know it exists. Meanwhile, TikTok users propelled Love to #1 on Netflix, just based on their reactions to the opening scene (years later, mind you), and only A24 has any presence there – as a hashtag, with 65.7M views!

It’s telling that Trump doesn’t care about China owning AMC, but is in a shit-fit over their ownership of TikTok. Because it’s culturally relevant, unlike movies. Because it’s actually protesting him effectively, unlike movies. Because people have fun while being political, unlike movies. Because it’s shifted everyone’s attention away from FB, unlike movies. Because it collects data on its audiences, unlike movies, and is transparent about it, unlike movies, and uses it to make a better user experience, unlike movies.

If Hollywood understood the real depth of societal change going on here, we wouldn’t see Microsoft as the lead contender for buying TikTok – it would be Disney. Or Netflix. Or Apple (which maybe is/n’t trying?). And any of them could better integrate TikTok into their plans for the future than Microsoft. Sure, social is fickle, but it’s usually killed when the wrong person buys it. Or the right person doesn’t. As other’s have mentioned – this is a once in a lifetime, fire-sale opportunity.

But to be honest, if I were Microsoft, I wouldn’t take the bait. It’s not TikTok that matters, really, it’s the ideas of participatory culture, eliminating the gatekeepers, letting “amateur” creativity flourish, and these trends will continue even if TikTok dies. Microsoft knows nothing about these trends, and has no business reasons to piss off China, while gaining the future headaches that TikTok will bring. Let an actual entertainment company buy it, or call Trump’s bluff and let it die, while 100M+ users revolt at the election box and then turn another app into the same thing. That may be the only way to win come November, anyways. 

We’ll see how this all shakes out soon enough. But I likely won’t hear about it before September. As I mentioned on June 4^th, I started my social media vacation early this year, but every year, I take off the month of August from all social media, newsletter postings, and disconnect. It’s an annual vacation that renews my soul. I’ll be on email for clients, but pretty much disappear from the public completely until Labor Day (three weeks are completely unplugged, fwiw). Until then – stay safe, learn to use a VPN and wear a mask.

Stuff I’m Reading

Film

The Reconciliation Must Be Televised – Wesley Morris writes what may be one of the most important proposal pieces of the year for the NYT. Read the whole thing, but his argument is essentially that we must turn this moment into a National (international) dialogue and project of truth and reconciliation. Building off the recommendations of the Kerner Commission and going much further, it would be a reconciliation across multiple platforms, simultaneously, and across weeks. I would argue further that it would be best for the NYT to launch this across platforms, and that would be a better project for their media efforts than Father, Soldier, Son, but it’s much needed. From the end of the article: “This Moment didn’t come cheaply. It should not be squandered. It should be nationally witnessed and absorbed. Truth and reconciliation is a death and a birth, accordingly arduous, tense, procedural, affirming, painful. The outcome feels secondary to the process. The ritual is the benefit. The Moment demands that we summon the courage to put ourselves through it. At last.”

BGDM Fundraiser: Brown Girls Doc Mafia is raising funds: “With your support of this fundraiser, we’ll be able to further leverage community building and programming that enriches our members creatively and professionally, and further sustain our efforts to advocate for access, visibility, and power for BIPOC professionals in the film industry.” Donate here.

Hollywood’s Gone Timid on Political Content – Foreign Affairs reports on how Hollywood is running out of villains as it frets about offending China, due to box office, or Putin or North Korea, due to worries about hacking. What happens to soft power, when you can’t villainize anyone? Great question, but also knowing how xenophobic and unquestioning Hollywood could be in its victimizing, the counter-argument is – maybe we need different villains anyways.

Fragmentation is a pain in the ass’: Proliferation of free, ad-supported streaming services causing headaches for media companies – Digiday covers the nightmare that is trying to buy ads and place content across multiple systems.

Branded Content

‘That innovation budget has gone’: Publishers adapt to thwarted branded content studio growth – Digiday covers how publishers are struggling to make a living in the new branded content/ad cut environment. It ain’t pretty.

Miscellany:

‘Apple Glass’ users may be able to manipulate AR images with any real objects – The implication being that you will no longer need a physical tablet/computer.And you’ll be able to do a lot more cool stuff.

Internet Archives Fires Back in Lawsuit Over Covid-19 Emergency Library – yet again, rights holders ruin something great. Vice covers the IA arguing – hey folks, we’re just doing what libraries do, get over it.

The truth is paywalled, the lies are free – Nathan Robinson, writing in Current Affairs, covers the fact that all of the great sources of news are paywalled, but the purveyors of bullshit are giving it away for free. He takes it a step further and proposes how we could build a universal, free database, and still pay authors/publishers. Worth a read, and a think… even if Jonathan Zittrain already proposed this solution back in 2006.

We are living in an era of superabundance, where my attention is more valuable than my money, and while this is great for audiences, it’s a disaster for arthouse and indie films seeking any revenue. There’s a small silver-lining for niche and social impact documentaries that want eyeballs more than dollars, but overall, the sector is imploding and no one is talking about it publicly, though its dominating the “off the record” conversations I’ve been having.

At the start of Covid-19, nearly every distributor and film festival moved to a virtual model. Distributors developed virtual cinema programs, pairing with theaters in an effort to make some money, keep a relationship with audiences and maybe save theatrical. At first, things looked pretty good – KinoLorber was reporting numbers that weren’t very dissimilar from their 2019 theatrical numbers, and they touted them in IndieWire and elsewhere. But you’re not seeing those stories in the press anymore, and I suspect that it’s because they’ve dropped down into the abyss, as many are reporting to me behind the scenes (I have not asked KinoLorber and don’t know how they’re doing, but know it’s not being reported anymore).

One distributor told me that their virtual box office dropped from 5-6 figures per title down to under $10,000 for a month-long run. Theaters have reported to me that they’ve played ten or more titles from some distributors over the past few months, and not only have they seen revenue decline to the few hundred dollars per title, but that they’ve not received reports or payments from many well-known arthouse distributors at all – but their patrons are getting inundated with spam emails for more titles. Theaters at first saw this as a way to stay relevant to patrons, but are increasingly getting desperate. A few have been able to open drive-ins, but these seem to be working mainly for repertory fare and bigger genre titles, mainly horror – but they’ll take the revenue.

This past week saw the launch of the NYT’s new documentary, Father, Soldier, Son on Netflix. It is a feature documentary, but the NYT is also supporting it with advertising; an introductory article about the history of the piece; a robust interactive feature story, that is also duplicated in print via a 72 page special  section of the newspaper that was delivered over the weekend; plugs in their What’s On TV section; through a movie review by critic Jessica Kiang (with an embedded Netflix trailer/ad, and direct links to tickets for which they get an affiliate fee, which they do with most films); a Times Insider piece, which in print sits just inside the front page, and which also promotes the genesis of the project; and of course through their social media pages, including Facebook during the #stophateforprofit campaign, also with Netflix Originals logos. In other words, the full court press.

As I posted on LinkedIn last week, let’s be clear – This is Branded Content. The Brand is the NYT and they are promoting their brand via their journalism and their film criticism and every other resource simultaneously. It is also simultaneously brilliant, well-executed branded entertainment that others should emulate, an ethical conundrum to consider for the future of journalism, and possible the most meta-media occurrence of late (which Noah Cowan pointed out on my post). So what are we to make of the NYT as publisher and brand?
 

Monday we collectively crossed the rubicon. My emails, zooms, conversations took a darker turn. The USA has changed its name to DumpsterFire. Trump trademarked the name, but it’s been a crowdsourced effort. As the US started locking down again, and even Hong Kong started to re-close theaters, the film world seems to have collectively woken up to the reality that this shit is real and nothing is getting better anytime soon. So what do we do to survive?
 
Small businesses are giving up. Cases are climbing. Schools are in turmoil. Cities, Counties, States and entire Countries that were doing better are not looking good for the future (but I’m mainly writing about the US here). Behind the scenes, I’ve had conversations I can’t detail with experts I can’t name (but anyone who knows me personally can gather that I have some good sources) that public health experts are a) not feeling we’re ready to open as much as we’ve done, and b) are headed towards surges that no one is publicly discussing. And what little we’ve done to prepare, is publicly known to not be enough.
 
Promising developments are starting to fail. I’ve argued about flaws in some of the models, but it has been great to see festivals, distributors, individual filmmakers, and in other arts, things like theater and dance, and even art auctions switching to online offerings, drive-ins and distanced screening ideas. But even here, reports remain the same as elsewhere – because of no centralized leadership, and a forced reliance on ad hoc, entrepreneurial decisions (partly a good thing) – we have a cacophony of shouts for solutions, but no coordination and thus declining attendance, impressions, sales and a lessening in any metric you might measure. The emails between potential collaborators have moved from positive outcomes to private confessions that we’ve been building solutions for a quicker recovery than will ever be possible and far too few of us can weather another 6-12 months or longer in this Sisyphean slog.
 

The big news this week was that Britain is Investing £1.57 billion in the Arts (about $2-B USD), showing that even a dysfunctional government can figure out a way to save culture (wouldn’t that be nice here?…). Boris Johnson announced major grants and loans (predominantly grants) “to protect Britain’s world-class cultural, arts and heritage institutions.” Read about it from the UK gov’s website here.
 
But as the NYT reports, Germany is giving 1 Billion Euros, France is giving 5 Billion and even smaller countries like the Netherlands have given 600 million. Looking at this can make a US citizen cry because we’ll never see something like this here. But here’s the thing – Britain’s investment came after a concerted effort, and was never a sure thing. From the NYT: “The British package was met with surprise by the country’s theater industry, which had been running a coordinated, celebrity-led campaign for weeks in a bid for support as theaters announced major layoffs.”
 
Over here in the US? We get Gal Gadot’s disastrous video of Imagine. Where’s our movement to save the arts? Pretty much nowhere to be found. Jesse Green, again at the NYT, wrote a scathing piece about the lack of activism by the American Theater world, saying its leaders have been clueless and absent, adding: “But the American theater’s biggest failure is the one that renders it helpless in an existential crisis like this. In allowing itself to be cast as just another industry — a role it does not even play very well — it has disowned its true identity as a public entitlement.” But he should be calling out the entire field of the arts. In America, there hasn’t been any real/concerted effort to galvanize the public to support the arts. In fact, most arts leaders gave up, before even trying.

This week’s newsletter is coming a day late, because today’s article ran first in IndieWire (slightly edited). Check it our there or below:

For the past few weeks, practically every business involved in the film industry – from Studios to Platforms to Agencies to Filmmakers – has been signaling their support of the #BlackLivesMatter movement, and for waking up to the need to support more BIPOC filmmakers, films, artists, talent and causes. This is a great thing, especially if it leads to action as opposed to just talk.

But when it comes to a closely related cause – the #StopHateForProfit boycott of Facebook, the industry thus far has been pretty silent. This needs to change; the film industry needs to follow Magnolia Picture’s lead and join the #StopHateForProfit campaign, and fast. The campaign starts July 1, and as of this writing, it looks like the only film companies on the official list of companies boycotting Facebook in July are: Magnolia, the Coolidge Corner Theater, and somewhat tangentially, Verizon. More may add their names soon, but that’s a pretty low count. Where are the other indie distributors? The film festivals? The studios, broadcasters and platforms (especially)? Where are the nonprofits who support filmmakers, and run the Award shows? Where are we in the mix?

It’s time for brands to start collaborating around content, specifically – it’s time for them to collaborate to fund, market and distribute films for social impact. I’ve been preaching this for awhile now, but to my knowledge, it has only happened once (more on that below). They also need to be collaborating with foundations and other traditional funders and supporters of social change films. Again, something I’ve been preaching, but it has become imperative during these times. 

This has become most pressing because of the recent Black Lives Matter protests, and the degree to which they’ve finally opened up so many people’s eyes to the issues we have in the US and the world around diversity, discrimination, inequity, and so much more. But it’s also been made more apparent by the Covid-19 crisis, which has both exposed so many similar issues and made them worse. Brands have been pretending to address the social issues facing our society for a long time, and have signed pledges, and have said they’re taking action. But as we’ve seen in so many areas – it takes a community to make change. These crises are too big for any one person or brand to tackle. Sure, Patagonia can bring attention to environmental issues, and Greta Thunberg has been an inspiration, but if we want real change, and to have a real impact, we need more collaboration. 

But there are multiple other, yet related, reasons for brands to collaborate. First, we’ve seen that years of cuts to government, and an alarming move to many more autocratic leaders have led to a complete failure of government. New Zealand is an exception, but in the US, we’ve now fulfilled Grover Norquist’s goal to reduce government to where it can be drowned in a bathtub. I am no fan of letting corporations take the role of government, and think it’s a travesty, but here we are (I am left of Marx, politically, but also a realist). In the US, Britain, Brazil, and so many other places, austerity has led to a situation where we have to rely on corporations, foundations and a few rich people’s funding for any progress. I’m down for blowing it up and building something better, but for now – we need corporations to take the lead.

This past week brought another case of whiplash, as the entire US (and world) began to re-open, in spite of alarming spikes in cases in multiple states and countries. It’s as-if a large part of the world thinks back to the time when, just weeks ago, hospitals were reporting they had to stack up bodies in trailers because of the rapid death spiral, and thinks, “bored with that, time to move on.” I’m not talking about the protesters either – the reasons to protest are clear – but the rush to open everything else – especially to hang outside in NYC and drink in crowds of a size we didn’t see outside of Mardi Gras pre-virus – are nothing less than jaw-dropping. And my jaw can drop because I’m wearing my mask instead of using it as a double-chin holder.

In the film world, we are already seeing theaters open; the release of guidelines for productions to launch; a move by many festivals to an online, drive-in and hybrid models; and a general sense from many that we’re moving into some new normal. I have many worries about how successful this might all be, but you can’t fault people for trying to survive.
 
But the most important discussions in film these past weeks have been around diversity. We’re finally having the discussion a little bit louder, and there seems to be some genuine movement around changing the status quo. But while we’re seeing a lot of discussion, I wonder how we’re getting to action, fast enough in some of our most important spaces – not just the who is making the content, and who is on screen, and what stories are being told, but in the leadership and staffing at distributors, exhibitors and especially film festivals.

Ok, that’s a somewhat misleading title, because Athletes Unlimited is a new business model for sports, and while it’s starting with softball, it’s already moving into Volleyball and will soon move into other sports. But it’s unique model is one that I think holds a lot of promise, and is one which shows how to think about real innovation, and could be a good example or inspiration for people in film/media who also need to rethink business models.

First a disclaimer – Athletes Unlimited’s co-founder is Jon Patricoff, and he and I worked together at Tribeca years ago, but I am not too biased here as we remained friendly but barely stayed in touch and I have no private insight into this business, only what’s online. He moved from film to sports, and this new venture isn’t just a new business model, but also a mix of sports and storytelling, so it will be interesting to watch regardless.

Athletes Unlimited will launch in August outside Chicago, and its first venture will be a new women’s pro softball league that eliminates managers, owners and even the fixed, city-based team format. Instead, all games are played in one city – Rosemont, IL to start – and online, and there are hints of a broadcast deal to come. Each week, four teams are put together for three games, and each team is redrafted – every week – by the MVP’s of the game, which are determined by a scoring system and player votes. The idea is that fans no longer congregate around teams based on cities, but based on the players they love. And women, pro softball players have a lot of followers online (many apparently have super high follower and engagement rates).

Every player is guaranteed a minimum income, and can earn even more based on their performance and engagement. And all players are part owners of the company. Not just for one year, but for the next 19 years – because the early adopters are taking a risk and helping to build the company. In fact, while the League was founded by two white guys (Patricoff with Jonathon Soros), they are apparently capped at 10% and the players are majority co-owners with them, so in theory, the ownership will have great gender equity and possibly diversity built into its structure. They also happened to build a business model that’s perfect for C-19 before it took place, but that definitely informs how to think about this and all business going forward.

There’s a lot more to the initiative, and you can read all about it in Sports Illustrated, or Softball America (and here), or in this recent NYT article, which is where I learned about it. But I’m most interested in the innovations that I think lend great ideas for the film/media sectors. In no particular order:

With all of these online versions of film festivals popping up, I keep getting asked by filmmakers – “should we participate in this?” Or more often – “am I missing something? Why would we do this?”
 
My answer is always the same – if you are launching a brand-new film that is still seeking distribution, no. If you have a short, or an older film, or one where you have locked in distribution (and if your distributor agrees), or one where you are doing a DIY release – sure, or at least maybe. But if you are trying to premiere a feature film, and you don’t yet have distribution, then as of now you can’t consider these online festivals because buyers consider them a conflict with their distribution of your film. They do NOT see it as word-of-mouth building, or good PR, or a way to test/prove audience demand. They see it as a distraction at best, and lost income, or a loss of control or a loss of premiere status at worst.

Lately, when I speak with my closer film business friends about this Fall, the topic inevitably returns to how the film industry might re-open and whether we’ll be able to attend Toronto or other Fall festivals? The answer to this is no, but my new reply is always: I’m less concerned about whether or not we will gather in theaters than whether we’ll be able to gather in Washington DC, in protest, come November when Trump tries to stop the election.

Fair Warning – Stop Now if you don’t want politics – non-political news is “below the fold.”

Bonnie: Don’t let it end this way.
Brian: All things end badly, or else they wouldn’t end.
AKA Flanagan’s Law, from Cocktail

During the past few weeks, I’ve joined many conference calls discussing how the film industry might change due to the Covid-19 crisis. And I’ve read many articles about this. With very few exceptions, they’ve all been based around an extreme optimism that assumes life will return to normal at some point. And wouldn’t that be nice?

When coronavirus shuts down everything, you gotta do something positive. Here’s a quick roundup of some generally positive, good ideas that have come out of the crisis. Some are worth copying (or paying homage) if you’re looking for ideas for your own film, organization or just your free time. (Note: the photo above is from the NYPost of some kids who made a hands-free lemonade stand in NYC).

We’re just barely into this coronavirus situation and I think we can all agree it’s gonna get worse before it gets better. While the world needs optimists, it also needs realists, and I’m in the latter camp, feeling pretty sure this is going to last much longer than a few months. But whether this lasts 3 months or 18+, the impact on our world is already huge and the film world needs to think big about how to respond.  Here’s just a few thoughts that have crossed my mind this week in regards to how we should respond, in no particular order, and definitely not trying to cover every facet here…