Netflix Becomes a Cable Channel
I'll begin this week with a personal story. A few years back, I interviewed for a gig at Netflix. They were growing at a phenomenal rate, and I, being disillusioned from my gig at 20th Century Fox, decided to throw my hat in the ring at The Great Disruptor. I admit to being excited about stepping into the belly of the beast, heralded as the future of entertainment and a great place to work that pays extraordinarily well. After suffering through years of garbage starting salaries at the studios, Netflix seemed to be the proper next step. However, after my first exec interview, I knew something was rotten in Denmark.
As I wrapped up my first meeting, my interviewer snapped at her assistant about the next location (bad sign #1), and after receiving said location, she started to walk me over. While we were walking, we happened to pass through the commissary area (while they were still in Beverly Hills before the move to the Hollywood Tower of Terror), and I mentioned it must be nice to have all this at your fingertips. To which she replied, "It's so we never leave." And right then and there, I knew Netflix was not the great change agent that so many had heralded it to be. The level of snark and downright animosity contained in her statement made me realize that though Netflix might be rocking the boat from a distribution angle, they were still just like any other entertainment company. I ultimately didn't get the job, and it's likely they sensed my hesitation after that brief encounter, but it still looks like it was all for the better.
Flash forward a few years, and here we are. Netflix has crashed back to earth, facing the reality that the spending binge couldn't last forever, quality matters (as my co-host Tim Thompson has been saying for years now,) and advertising might be in their future. There are countless takes you can read about the Netflix reality check, so I don't want to harp too much on this, but I think it reveals something I've mentioned on the podcast before: OTT platforms are just the cable channels of the 90s. For those too young to remember, when the HBOs, Showtimes, TNTs, and other big cable channels hit, it was the new rebirth of TV. You'd get more choice, more content, and all for a slight increase in your cable bill (sound familiar?) The OTT era was going to the next shift in entertainment, albeit with bigger budgets. And yet, here we are, where everyone is preaching quality over quantity and moderation on content spending.
What this era has ultimately ushered in is consumer choice. With the advent of mobile, the saying went that consumers want what they want, where they want, and when they want it. This was inevitable as the spending couldn't continue forever without solid proof that this was an actual profitable business. Profitability will now be a part of the questions investors will start asking. Cable companies resisted the loss of the "bundle." Now, we have the OTTs, which provide the choice consumers have wanted all along. Hence: Netflix (and the OTTs) are just unbundled cable channels. Part of me is ecstatic at this development because people may finally realize what a real movie is again. Although, as you'll see below, given the delusion happening in Vegas, I'm not particularly confident that will happen.
CinemaCon Stupidity
It's that time of year again when Hollywood distribution descends upon Vegas to hang with the potentates of the great exhibitors and the owners of the smaller shops. It's the only time Hollywood affiliates with anyone outside the Westside/LAX/Valley nexus. While it is excellent that CinemaCon is back up and running after a rough couple of years (2020 canceled; 2021 paired down), the stupidity and blinders are still in full force. Take a look at this gem courtesy of The Ankler's Richard Rushfield, the man on the ground at Caesar's:
'"..by a sudden lurch into pep rally mode as Marcus Cinemas CEO Rolando Rodriguez urged the crowd to its feet for a group chant "so they hear us in the casino" of "WE! ARE! BACK! WE! ARE! BACK!"
The chant had a doth protest too much ring, but Rodriguez seemed to realize his colleagues needed shaking out of their stupor of the past couple years. He exhorted, "We have to believe we're back. We have to say it. And we have to deliver on that." The admonitions had a slightly sad Stuart Smalley tone, but if theater owners just believe in themselves, yes, theatrical can come back!
NATO boss John Fithian took the stage in full bravado mode, declaring, "I'm pleased to announce today that simultaneous release is dead as a business model!"'
I'll give it to Rolando, who wants to pump the crowd up, but John Fithian, come on, man. Your part of the industry that barely survived is still circling the drain, and the best you can come up with is that?! How about: "We need to address the experience issue if we want audiences to choose us over their couches." At least showcase to the world that you have the slightest modicum of understanding about what is happening. But no. All you have to do is trot out Dwayne Johnson, and we'll pretend that the last two years didn't happen.
Our guest last week, Cami Sargent, made a fascinating point about the difference between streaming and theatrical: it's about the experience, which makes all the difference. EXACTLY! The exhibition industry and the industry have a real opportunity to learn from the last two years and take advantage of the current environment, particularly with the revoking of the Paramount decree. Alas, it looks like we're in for more of a Titanic-esque attitude of everything is fine, just return to staterooms as the boat sinks. The more things change, the more they stay the same.
Pages from the Commonplace Book
This week, we turn to another famous Founder and fellow Pennsylvanian, Benjamin Franklin.
"Search others for their virtues , thy self for vices."
We've certainly flipped the script on that one in our day and age. Perhaps, it is time we go back to looking for the best in others and focus on improving ourselves. Always seeking to be better oneself is a surer way to true happiness.
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