Welcome to another round of behind-the-scenes insights (for a longer version, check out my hollywood101.substack.com newsletter, which comes out every Wednesday and is now available to subscribers with archive access and bonus content!) aka What’s Up took place behind closed doors in Hollywood last week.
Who made the most money last year?
The ratings of the first quarters go hand in hand with the pay packages of Hollywood CEOs. This time we got very high in the measurement of the pints, because as mentioned earlier, many studios have a CEO salary dependent on the generated cashflow. And there was a lot of free money last year thanks to the strikes. It is not without interest that David Zaslav sneaked this condition into his payroll almost at the last moment, and his brutal cuts may have been partially inspired by the potential personal remuneration.
This tactic paid off anyway. Zaslav’s compensation jumped to fifty million dollars, which is somewhere on the level of Ted Sarandos, whose salary I wrote about last time. Ted can certainly afford it, even though he torpedoed Netflix’s stock price a bit by announcing that the company would no longer announce quarterly subscriber numbers. The mild panic on Wall Street and among investors is ending and it looks like value will rise again. Bob Iger for Disney and Bob Bakish for Paramount settled for about thirty million dollars. A relatively conservative sum for Iger, unusually generous for Bakish, but in both cases context is necessary. Iger battled with activist shareholders for almost a year and had to appear modest, cut costs and promise the impossible. Bakish served more or less on a sinking ship called Paramount (see below), so his compensation can be taken not only as an echo of past achievements, but also as a golden parachute.
And who won the remeasurement? Head of Endeavor and TKO, the famous Ari Emanuel. The former agent of the stars and today the CEO of important companies received four times his salary for the year 2022. The total amount of his compensation was 83.9 million dollars, of which about 4 million in salary, 34.6 million in financial bonus, 43.5 million in shares and the remaining change (about 600 thousand dollars) are reimbursed expenses for representative flights in the company’s private jet.
It’s worth recalling that two years ago, Emanuel had $301 million in compensation, mostly stock packages, backdated over several years. It’s a huge figure that exceeds the salaries of the biggest CEOs. By comparison, the head of Blackstone, the giant investment fund we talked about in connection with the shareholder battle at Disney, made $253 million. Behind him is the CEO of Alphabet (Google) with 226 million. Tim Cook for Apple with 99 million next to them looks like a poor relative.
A prayer for Paramount and old (good) Hollywood
A week ago, many people behind the scenes were surprised that Bob Bakish came to $30 million from the bankrupt Paramount. They got it on Monday when Bob was fired and replaced by a trio of current bosses. The move came on the heels of quarterly results that saw the studio score two hits (the new Mean Girls and Bob Marley), get plenty of ad money thanks to the Super Bowl, and Paramount+ gain about 6 million more subscribers (already 71 million in total ). As with the others, it was possible to reduce the losses of the streaming division, pay off a piece of debt thanks to the free money from the strike months. But the overall picture is not optimistic. Overall, Paramount posted a loss worth several hundred million, its streaming platform is globally fragmented and unpromising due to its partnership with Universal (SkyShowtime), and its output is tiny compared to other major studios.
Needless to say, none of this is directly Bakish’s fault. Paramount has been run from wall to wall for a long time, and Shari Redstone, from the position of the main shareholder, treats it like a battered wallet. She has been angry with Bakish for a long time, because the loss-making Paramount does not pay dividends, and thus Shari does not have to pay off her large bills. That’s why David Ellison’s Skydance is currently being courted. Bakish was lucky last year that everyone at Paramount bowed to the previous year’s Top Gun: Maverick, but one fighter swallow doesn’t make a spring.
In addition, Paramount primarily makes money from its television and cable network. He threw himself headlong into streaming, but actually only half-heartedly, because there were no funds for greater ambitions. Cable shows are gradually dying off in terms of viewership (Showtime, BET) and Paramount can no longer successfully get rid of them. The film division is small, so reselling content like Sony is not a salutary alternative for it.
What with this? Breaking it down and selling it better – like Rupert Murdoch did with 20th Century Fox was a theoretical possibility a few years ago, but it’s too late now. A viable alternative is for Skydance to buy the film studio and keep the famous brand (although it will actually dismantle and sell off everything that doesn’t fit). Or Sony will get to it through the Apollo investment fund, one studio will absorb the other and Paramount will definitely end as a brand.
The first option means lawsuits from other shareholders, the second means disapproval from the state and a big roar in Hollywood, which will shrink from five major studios to four. One way or another, the end of Paramount as we know it is definitely coming. And for Hollywood, it will mean fewer job opportunities and fewer partners. Why haven’t I written a separate topic about this yet? Because there is also a third option – that nothing happens, Shari fails to sell to Paramount and the studio gradually dies and becomes the subject of a so-called forced takeover. Such raiders then proceed according to the already indicated scenario – they sell the still alive and promising parts of the company, close the rest and the fun is definitely over.
Skydance is the only chance that Paramount will survive as a brand and we will be left with five traditional studios. At Sony, by the way, the role of a successful dealer cannot be overestimated. At any time, the Japanese can pack up and simply leave the world of cinema. The purchase of Paramount might, on the contrary, hook them more. Otherwise, after the departure of Sony and the collapse of Paramount, only Disney, Warners and Universal, supplemented by Netflix … maybe Amazon and Apple, if the moving pictures continue to entertain Big Tech, are in danger of surviving. Three old and three new. A studio six like the world has never seen.
Five years after Endgame
Does the previous paragraph sound like the end of old times? Believe me, I’d love to spread positive energy, but the current Hollywood hangover isn’t being hyped up by the media for cheap clickbait. Everyone finds a million reasons for the momentary depression, after all, I pull one out of my hat every week. On the occasion of the fifth anniversary of the premiere of Avengers: Endgame, a rather unseen one is offered by the way. I’ll skip because Chris Hemsworth regrets the fours of Thor and would like to return to the hammer. I’ll skip that the Russo brothers evaluate the current state of the MCU and would like to return to it. I’ll also skip over the fact that Robert Downey Jr. he remembers Iron Man’s armor and wants to get into it… but you know that.
In the rearview mirror, however, Endgame, with its mammoth sales and huge impact, acts as one of the last great trumps of monoculture, i.e. as a phenomenon that affected absolutely everyone. It was the event everyone was talking about. A colossus whose importance forced you to see it as soon as possible.
This is not the same monoculture as when in the nineties everyone watched Friends, Renegade and Stargate so that they could talk about it in the company kitchen or school desks and everyone knew what they were talking about because they watched the same episode the day before. This era has been gone for at least a decade, quite possibly two. It is a gradual process, with which only the greatest hits from Netflix, Game of Thrones or … that will be all, will be fought now and then.
What prevents the consolidation of an online cultural community? An excess of content, a lack of time and, paradoxically, social network algorithms. You try to find viral hits, shoot them in the forehead and produce “hits”. However, there is a split between what appears to be popular and what is actually popular. Colleague Cífka was recently upset that a series appears on ČSFd week after week which, according to user ratings and comments, is “the best in history”, the last time this happened was with the adaptation of Fallout. Best invention since sliced bread, best video game adaptation, best series of the year. And you know what? In two weeks, the same story will be told about something completely different. And in half a year, no one will remember, because something else will be pushing us.
Creating lasting memories with today’s fast-moving content is harder than ever. Few stand the test of time, and exceptions like Top Gun: Maverick are on the wane. It would be very thought-provoking if someone tried to redefine the current mainstream as a current that grabs you, knocks you to the ground and spits out a satisfied feeling all over your body, but with Bourne amnesia. Yes Yes. It’s not very sunny today. I’m going to make some cocoa in a polka dot mug and watch Thanos get the lens on the projector.
In one sentence…
Ryan Reynolds and Rob McElhenney have bought something again. As Wrexham continue to move up the league, sports entrepreneurs have also invested in Mexican football club Necaxa. The hundred-year-old brand already has some investors, including Eva Longoria, who brought McElhenney to the idea. Expect a TV show within a year and a day! By the way, in 2020, when they bought Wrexham, Reynolds and McElhenney promised the locals five things – their club will be promoted, their club will not move and instead support the local community, their club will get training facilities comparable to much bigger teams, their club will be in the red and will help to renovate the wider area and to the top five – their club will become famous all over the world. They did everything to the letter, the scribbled fools!
One of the big VFX houses, DNEG (the other Dune, Oppenheimer, Last of Us) is making massive layoffs, as Hollywood contractions are already affecting the otherwise traditionally overworked sector. There’s not enough work in the TV sector or marketing either, so it’s getting slimmed down temporarily, which is fairly common in VFX. However, due to the current situation and the fear of the onset of AI tools, many employees are afraid that they will never look back at “their” offices.
And I’d like to touch on a potentially juicy topic that we’ll save for another time. A spectacular behind-the-scenes write-up of Amazon/MGM’s long-troubled Christmas comedy Red One has surfaced at TheWrap. We all kind of suspected that it would be an overpriced and not very good film that the studio has been anxiously hiding in a drawer for several months (it showed a preview at Cinema Con only to a select circle of “supporters”), but this hit-piece about Dwayne Johnson, which comes to filming several hours late, constantly urinating everywhere in pet bottles and annoying everyone, that’s dynamite, which someone will have to react to soon. In the meantime, I’ll make some popcorn and then we’ll talk about it all in detail (when the dogs bark at each other it won’t be “one lady said”).
Tags: imf Hollywood Fairytale fees burning Paramount fragmented monoculture
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