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By David Poland

Mike Fleming Rants… And Is Really Lost

One of the things I enjoy most about Deadline is that their sourcing is almost always unintentionally transparent. It is the nightmare of entertainment journalism in Los Angeles that it is driven almost completely by agents and unnamed executives. They talk. They seduce those journalists who want desperately to be seduced. And the agents/execs get those journalists – even some very, very bright ones – to sell the spin.

And this is who Mike Fleming talked to the last time he was in town… and what he got was some very bent, historically-challenged thinking.

Read it… and understand how the people who dug the hole they feel they are in just want to keep digging. The tyranny of the new is particularly powerful over the paranoid “old.” And seemingly, even more so over those who keep pushing for change when each NEW IDEA falls by the wayside in short order.

The DVD Bubble destroyed the perspective of a generation of Hollywood thinkers. The goal has devolved from figuring out the best way to create and exploit content to an obsessive lust to find “the next DVD.” But there is no “next DVD.” Why? Because even though more content will be available more easily to more people in higher quality in the next decades, the clock cannot be turned back on the pricing issues that the studios, greedy and overeager, created.

Netflix created the subscription model out of a need that the studios, conspiring with Blockbuster, created. DVD launched as a sell-thru product and the price point was so low that 15-20 views of a DVD in a subscription model made the disc profitable, even at retail. And Netflix wasn’t paying retail or even wholesale prices for long.

If you rented 3 videos a month, Netflix gave you an nearly complete library for less money each month. If you were buying DVDs, suddenly you could rent with great ease at a cost of about half of one DVD a month.

But it wasn’t Netflix – and certainly not Netflix streaming – that killed the video star. People forget that DVD for feature films started dying on the vine for years as Netflix grew and for years before Netflix seriously established streaming as an option for most of their customers… all before Redbox was a nationwide business. (Let’s no get into the Netflix stock price these days.) Besides rental and subscription rental, there was massive and wide-spread discounting on the retail product as well.

Meanwhile, at the studios, the DVD Bubble sent the spending on movies through the roof. $20m “stars” were all over the place. $80m set movies, comedy and drama, became average. $150m for action was a modest budget. And marketing budgets blew up in order to front-load theatrical so that they could get to DVD revenues a quarter later

Agents… the main source for guys and gals like Mike Fleming… LOVED this. They got insanely rich. But it was a bubble… because DVD sell-thru was a bubble. Now that the bubble burst, there is a new normal… but agents hate it. They want to know how they are going to get back to the bubble.

And execs saw their studios get hurt. The slowest to respond to the shifting revenue picture got hurt the worst. The grosses, for instance, for dramas, did not get smaller, as some idiots in media claimed. However, the cost of production was double what it had been, say, 4 years earlier. So a drama that would have made money with a $45m domestic gross was losing money for the funders.

Of course, agents and execs were also in a similar boat… their idea of “hurt” was flying commercial… they all want the jet back, gassed up and ready to take them to Aspen for dinner. And I get that. But shareholders, not so much. And if they knew how much was lost in profits in those fat, green DVD years, there would be blood running thick in the back lots.

The irony is, with all this whining, this summer is one of the most expensive summers ever. I count (roughly) seven films over $150m compared to four last summer. No one at the major agencies or studios can really be crying poor… just crying not as rich.

You know what’s confusing about the market right now? How much each post-theatrical revenue stream can generate, how quickly, and what will they look like in 5 years. High class problem.

And of course, the greatest irony of all… theatrical for features is clearly the most stable, highest-per-capita spend among all of the revenue streams. But this window, already under attack by the shortened window over the last 15 years, continues to the pointed at with disdain by “those guys.”

It’s not progressive thinking… it’s old man thinking… because they folks can’t get past the old model, where theatrical was 90% of the revenue. We’re decades past that. But still, it’s like something mommy did that adult children just can’t get over.

I’ll try to make it simple…
1. Post-theatrical is already a blur for consumers and it will only get more so. People will expect access at all times on any device for a low, low price… either in a subscription model or a per-use price point of $2 or less.
2. Theatrical will soon be the ONLY revenue opportunity that stands apart from that post-theatrical blur. No other revenue stream will ever again generate as much as $10 a person… or even $5.50 per person.
3. Consumers adjust to whatever window you offer. But history tells us, the shorter the theatrical-to-post-theatrical window for wide-release movies, the more cannibalism of the theatrical.
4. Just as the DVD bubble could not be pumped back up after it was deflated by pricing aggression, theatrical will not survive a significantly shorter window to post-theatrical as we now know it… and once it is broken, it will not be able to be fixed. And that revenue stream will NOT be replaced by what is now post-theatrical. It is simply money that will be lost, never to be recovered.

Theatrical will never be The Drink again. You’re looking at a 2 month window for most studio films vs decades of post-theatrical revenue opportunities. It’s not an even fight. But take a deep breath and look at the obvious… for theatrical to still be as much as 40% of the revenue of a studio film is bloody amazing. It’s not the past. It’s not ’39 or ’69 or even ’89. But it’s a LOT of money. And it is insane to take it for granted or to dismiss it, because there is no proof out there that I have ever heard that suggests that theatrical revenues gets in the way of post-theatrical revenues… only the other way around. Why? Because theatrical is the unique proposition. It’s post-theatrical that really has to compete with EVERYTHING the world has to offer.

Think about it. With very few exceptions, no one goes to the movie theater and then decides whether to pay for and see a movie or to do something else. In your home, whether on a computer, an iPad, or your TV, you have the choice of a wide world of internet options, movies you’ve already paid for in your cable/satellite packages, pay-per-view, subscription pay services, and a wide array of television options, including live sports and other appointment experiences. Oh yes… and DVDs, Blu or other, as well. Not to mention such old fashioned pursuits as, uh, books, newspapers, and other dead media. (ha!)

I was going to make Fleming’s piece the center of this analysis, but I think I have covered most of it already without slapping at him specifically.

A couple specific points.

1. “…Old style Hollywood journalism I practiced most of my career at Variety, where I would polish stories all day and turn them in at day’s end so I could tell you tomorrow what I knew today. Isn’t it better to let Hollywood know Chris Nolan’s agent Dan Aloni was leaving CAA while he was being escorted out of the building?”

Uh, no.

Journalism, and specifically, the authoritative voice, has taken a HUGE hit in the name of reporting gossip as it’s happening. You know what matters? What does Dan Aloni leaving CAA mean? Why did he leave?

And none of that was answered as he was being escorted out of the building.

Yes, there is plenty not to like about once-a-day reporting. But there is something equally problematic about “tweet first, think second” as well.

2. Your friends may not have told you, Mike, but DVD is already dead and studios are already phasing out the format… including Blu-ray. The niche gets smaller every quarter… in part, like everything else, because the studios have already made up their mind. They are using Blu-ray as a delivery system for Ultraviolet and other streaming-first concepts that will roll out in the next 8 months. Try walking into a retailer that used to have a giant DVD section. Better yet, try finding 20% of the retailers who used to make a business of selling DVDs.

3. The Oscar stuff is, simply, idiotic. The most stupid question – and popular, too! – this Oscar season was “why can’t The Oscars be more like The Grammys?”

I refer you, simply, to the “On the Lot,” the quickly failed movie competition show. Movies are not a quick turnaround event. There isn’t a live performance business that is driven by taped performances, like music is. (Again, you might have asked your pals how musicians make most of their money… here’s a clue… it’s not making records.)

You can’t walk Meryl Streep out onto the stage and have her do 2 minutes from The Iron Lady. At least, not without laughing.

And let me understand this… your way of fixing the Oscars is to do a half dozen EXCLUSIVE scenes from upcoming summer movies… like fucking ComicCon?

Music is a live performance medium… and people watch the Grammys to see what those live performance stars will do live. Even theater, with the much lower rated Tonys, is a live performance medium and one reason to turn on the show is to see the live segments from a dozen or so shows now on Broadway… that by the way, you will have NO way of seeing in any other way.

Ask a film critic why the influence of critics is at an all-time low. General Answer: Because individuals have many more tools by which to make up their own mind about their buying choices, including, but not primarily authoritative film critics. Marketing. And what does Fleming and his cadre suggest? Turn The Oscars into another marketing opportunity. And trick 5 million more teens into watching awards being given out until they get to see a 2 minute clip from the next Twilight movie, because even though it would be awful television, the ratings would be improved.

Once again… a bunch of people are SCREAMING that the Oscars are on fire, so we have to burn down the brand in order to save the brand.

“Why not INVENT AN AWARD that gives the cast and filmmakers the chance to take a final bow in front of a grateful global TV audience?”

Because you have to EARN a place at The Oscars. You can’t buy it. What part of that can’t you understand?

Burn the brand and there will be no brand. Only more marketing… for a while… until being a part of it is more embarrassing than not.

Fleming is a smart guy. I wish he would use that brain and that access to come up with some new, considered ideas and not just continue to pound the bully pulpit for bad, old ideas that are too reactive to ever get ahead of the slow-moving, but clearly moving curve.

17 Responses to “Mike Fleming Rants… And Is Really Lost”

  1. cadavra says:

    He also whines about the loss of the star system. As I’ve said before, when you omit actors’ names from the marketing materials and shove all the credits to the end where no one sees them, you raise a generation of kids who go to movies and have no idea who was in any of them. (Sam Worthington, ladies and gentlemen!) Would folks like Eastwood and Nicholson have maintained 50+ year careers if they were just starting out today?

  2. JS Partisan says:

    David, why do you not get that it’s not about the performances with the Grammys. It’s about them being a more interesting show. The Grammys have gone out of their way to nominate and reward people, that people want to see win awards. The Academy, simply, does not do this, and that has to change. You know this will happen sooner than later, so why the protestations?

    Change is going to come to Oscars, and it will hopefully make things more interesting. Seriously, having a frontrunner from November does not make for a fun and interesting show. That’s the point that you seem to be ignoring, and it’s something the Grammy’s has remedied by giving people the winners they want.

    That aside, the cloud itself, is not the answer for the studios. The answer is something that integrates all the features we have now with BD/DVD, into something we can access on every device, and when the hell does that happen? We have countless carriers with freaking data caps now. How do we access all of this without using WI-FI?

    Seriously, the future of this is right around the corner, but it will not happen in the US first because our telecoms fucking suck. They charge too much for a service that’s still far behind the rest of the world. Who pay less and get a much better service.

    The future of smart phones and tablets is unlimited everything for a reasonable price, but do any of you see that happening? Outside of Sprint, Verizon and Att have no reason to cease being scumbags and to suddenly treat their customers like human beings. This leaves the film industry in a very precarious position until the telecoms decide to embrace the simple fact that they cannot win when the demand is for everything being unlimited.

  3. Rob says:

    No disrespect to Dennis Quaid and Sigourney Weaver, two wonderful, vital, sexy actors, but suddenly it’s a new thing that stars over 55 are doing TV series?

  4. David Poland says:

    Sorry, JSP, but you are 100% wrong about the Grammys. It has nothing to do with the awards. It is a live, hip Live Aid show once a year with major production numbers and great talent mash-ups. That’s all anyone talks about the next day, inc the star reactions to the concert.

    “Change is gonna come to The Oscars” is a lovely bumper sticker, but false and ignorant.

    It’s a bit of a Kane thing… if the Oscars keep losing viewers and The Grammys keep gaining viewers at this rate, the Grammys will catch up to the ratings in 20 years or so.

    And let me make this about Batman for a second. Nolan has been great. But only the factually ignorant can think that he “made” Batman work when others failed. His version of Batman took a character that was already HUGE with moviegoers and kept the fire burning and raised the bar higher. But in terms of raw success, Iron Man is a much more amazing success. Batman broke records with Burton and with Schumacher. Iron Man didn’t really exist for movie audiences until Downey. $500m for Iron Man, a wildly inferior product, is more impressive to me than $1b for Batman.

    Point is, it’s all about brand value and perception.

    Look, even the Emmys, which is a much less self-serious brand than Oscar, couldn’t dump the less glamourous categories. They backed off. And unless the whole Governors system at The Academy changes, which it won’t, there will never be fewer than 20 awards handed out.

    And if people want to jerk off, thinking the top 10 grossers being awarded each year will magically get significantly more people to watch this 3 hour show, one has to ask… why aren’t The People’s Choice Awards getting mega-ratings?

    Change for change’s sake is stupid. I have plenty of Oscar show complaints. But The Grammys are not a realistic comparison. Maybe the Super Bowl should be the standard… have Meryl and Viola fight it out. Just add lions.

  5. JS Partisan says:

    David, sorry, you are still a 100 percent wrong. Arcade Fire winning last year made that show. Adele winning this year, made that show. You can think it’s all about the performances, but it’s not. It’s about nominating and rewarding artist people care about and want to see win.

    You also know that it’s not a bit of a Kane thing, because we live in a “WHAT HAVE YOU DONE FOR ME LATELY?” world now, more than ever. Sure, the Academy have a deal with ABC for a few more years, but at this point the Grammys telecast will be worth more. Which is a real problem.

    Change is going to come because the Academy are reactionary and sensitive to scrutiny. The white folk thing getting out (You know, the people out of your bubble didn’t know that) along with the low ratings, should hopefully lead to them mixing it up, or getting over their genre phobia.

  6. Rob says:

    “but at this point the Grammys telecast will be worth more”

    Huh? Where are the signs that the Oscars are in any danger of not being one of the highest rated broadcast telecasts of the year? What, exactly, would ABC replace it with? A very special episode of Revenge?

    I don’t get the Grammys comparison anyway. A better comp would be the MTV Movie Awards or, I dunno, the Blockbuster Entertainment Awards (remember those?), which is what Fleming apparently is looking for from the Academy.

  7. David Poland says:

    JSP… you don’t seem to get the basic idea. What happens on a live show, like Arcade Fire winning, doesn’t happen until DURING the show. No one who tunes in knows that it’s going to happen.

    People tune into shows for what they know they will see. If Harry Potter had gotten even a smattering of Oscar nods that weren’t efx and sound before this year and had been nominated, it might have boosted ratings a bit… yes… like Rings… a long run. But one last wave from Harry, Hermione, and Ron… not so much. It’s kinda crazy to me that they didn’t do it anyway. The trio should at least have presented and if I was producer, it would have been a priority. But we are saturated with celebrity. It isn’t a big meter mover.

    What does move the meter is performance… which people pay a lot of money for at concerts all year long. (Almost) every live music performance is unique. This is clearly what makes The Grammys a must watch… more so than people accepting awards… or for that matter, Adele winning awards. Now, does Adele winning make the show? Sure! Great moments. But a very narrow niche tunes in hoping to see something like that. What they tune in for is a show that will have Paul McCartney, Bruce Spingsteen, Adele, what people assumed would be a great live tribute to Whitney Houston, Taylor Swift, Chris Brown, Tony Bennett, Rihanna, Cold Play, Nicky Minaj, Bruno Mars, Alicia Keys, etc, etc, etc.

    That is why people tune in… because they can see something, live (or live on tape), that they can’t see anywhere else.

    And, of course, the ratings still aren’t close to Oscar. But that’s not the main point.

    The white thing is not news. If you actually read me or any of the many other people covering the awards – including the LA Times – you would have seen mention of the old, white Academy hundreds of times before that dumb survey. Not a secret. Not going to change anytime soon.

  8. JS Partisan says:

    David, there are countless people with more pull than I have, who want the Oscars to change. They also do not want it to change just for change’s sake. They want a more interesting ceremony than the stale fart we had a couple of weeks ago. Why this vexes you so much, is still rather weird. Not as weird as your supporting any organization staying white and old in a day and age, where white and old needs to be phased out by YOUNG AND TAN, but that’s you.

    That aside, the Grammys, unlike their motion picture brethren, have gone out of their way to make their show more interesting. They do this by nominating artists and bands, that people want to see win. You can go on about performances all day but with the Grammys, that’s only part of it. The Grammys have made a concerted effort to make their show relevant again, and it’s worked. Why is suggesting the Academy make the Oscars as relevant as they once were, a fool-hearty suggestion?

    Seriously man, go back to the 70s, and see how they did things. How did that group all of a sudden become so narrow in their AWARD scope? It’s like they Academy is fighting their own war against what’s popular, and that’s silly.

    You also know why Emma, Dan, and Rupert did not present. They are Brits, part of a Brit BILLION DOLLAR FRANCHISE, and apparently giving that any sort of dap outside of a two second blurb from Billy Crystal, pisses off crews screaming; “THEY TOOK OUR JOBS!”, about the franchise.

  9. “They’ve almost completely vacated that middle space where star-driven movie were a staple of the slate,”

    I was whining about that since 2008/2009, when it was actually a problem. But since late 2010 and early 2011 (The Town, Social Network, Source Code, Lincoln Lawyer, Limitless, etc), there has been a steady stream of mid-budget ($25-45m) star-driven genre pictures, many of which are aimed at older audience (some even R-rated!), and many of which had brought about handsome rewards. Once Hollywood finally realized that a $40 million investment for such a thing could bring profits (What? State of Play shouldn’t cost $70 million? SHOCKER!), it’s been open season on somewhat older-skewing, star-driven genre entries, and thank heaven for that.

  10. scooterzz says:

    dp — despite any differences i may have with you. you really do have the patience of job….

  11. David Poland says:

    “David, there are countless people with more pull than I have, who want the Oscars to change. ”

    Did you read that somewhere?

    “They want a more interesting ceremony than the stale fart we had a couple of weeks ago.”

    Well, that’s true. I’ve never once suggested that I feel otherwise. But unlike you, I actually know what might go into making changes happen.

    “The Grammys have made a concerted effort to make their show relevant again, and it’s worked.”

    Asked & Answered. They made it a great live concert event. Smart. Has NOTHING to do with the Oscars.

    “Seriously man, go back to the 70s, and see how they did things.”

    The 70s? Really? 40 years ago?

    Here were the five Best Picture nominees at the 1972 Oscars…

    “A Clockwork Orange” Stanley Kubrick, Producer
    “Fiddler on the Roof” Norman Jewison, Producer
    “The French Connection” Philip D’Antoni, Producer
    “The Last Picture Show” Stephen J. Friedman, Producer
    “Nicholas and Alexandra” Sam Spiegel, Producer

    Some very good movies. That’s the year.

    But “relevance?”

    Fiddler and French Connection were the two biggest films of the year. One is a classic. One is… not so much.

    The Last Picture Show was #7 for the year. Clockwork was #9. I can’t find any grosses for Nicholas & Alexandra, but I know the film wasn’t in the top 15 for the year.

    Overlooked amongst the top 15 grossers of the year – Billy Jack, Dirty Harry, Summer of ’42, Carnal Knowledge, and Shaft.

    No doubt, Clockwork was an edgy choice… but it was Kubrick. But Dirty Harry, Carnal Knowledge, and Shaft have had an ongoing impact on cinema for these 40 years.

    Please, explain how this is a big change?

    Want to roll up a decade?

    Top 2 grossers nominated, as well as #7 and #13 & #55.

    But the top 2 grossers were Raiders and On Golden F-ing Pond. Chariots of Fire was the #7 and Reds #13.

    I’m sure that Raiders is the only film that you would NOT expect to be nominated for Oscars today. Obviously, no drama is the #2 grosser of the year anymore. Highest grossing drama of 2011 was The Help… nominated. 2010? The Blind Side. Nominated.

    Do you really want to argue that War Horse and Tree of Life and Extremely Loud & Incredibly Close and The Artist don’t match up with Chariots and Reds and Atlantic City as the same kinds of movies?

    Left out that year… besides the expected big films like Superman 2 and Bond… Body Heat, Arthur, Excalibur, Time Bandits, and Stripes.

    So tell me… how has The Academy changed in the last 30 and 40 years?

    I’m pretty sure it all comes back to The Dark Knight for you… as all things seem to do. If you really think The Academy Awards should be about the biggest franchises, you are a fool. And looking at all the nominations for Bond and Star Wars, etc, pretty sure history hasn’t moved an inch.

    As for Potter… stupid. That “brit franchise” has kept thousands of people working at WB in America. And the fucking Oscar went to a film made by French people… which by the way, was the only film shot in LA amongst all 9 Best Picture nominees.

  12. JS Partisan says:

    It’s the other way around whomever is posting as scoot this time. I have to have the patience of Job to post on a blog, where the moderator/owner refuses to accept anyone else may have a point better than his. Seriously David, this has nothing to do with TDK. It has everything to do with my love of the Oscars. If you don’t get that, then that’s your faulty reading comprehension.

  13. David Poland says:

    That’s you in a nutshell, JSP. You come into my space – built on my ideas, not as a coffee house for you – and you see yourself as being patient with me.

    I don’t know if it’s patience or selfishness that makes me continue to respond to some of your silly notions. I benefit from restating my thoughts repeatedly and considering your ideas seriously, even if they aren’t very serious. So I am listening and I do learn in the process.

    But if you want agreement, you’ll have to make some better arguments.

    And as always, you are welcome not to indulge me or my writing at all. I’m sure I’d miss you, but I don’t want to stress your tender constitution.

  14. JS Partisan says:

    David, it’s not about agreement. It’s about disagreement. We disagree and you treat me like an idiot for daring to do so. Excuse me if I take offense to it.

  15. Pat Hobby says:

    Make the Oscars more like how they were in the 1970s???

    You mean when many of the nominees wouldn’t bother to show up and they trotted out such high octane presenters as: Barbara McNair (1970), Sandy Duncan (1972), Joe Namath (1972), Joey Hetherton (1972), Tamara Dobson (1977), Marilyn Hassett !(1976), Lola Falana (1971), Twiggy (1974), Telly Savalas (1975), Rod McKuen (1976), Joseph Bottoms (1975), Henry Winkler (1978), Robby Benson (1979), & Carol Lynley (1979)?

    Helen Hayes was one of the co-hosts of the 1972 Academy Awards and she was 72 at the time!

  16. Yancy Skancy says:

    At least Hayes had won two Oscars by then. And she was a spring chicken compared to Betty White. :)

    I met Barbara McNair when I was a whippersnapper. It was by a hotel pool and she was in a bathing suit. Hubba hubba!

  17. Desslar says:

    The Grammys is much more of a vapid sales-based popularity contest than the Oscars. I hardly think that’s the right direction to go.

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