What I’m Hearing: Recession Fears & “The Dark Age” of Profit-Sharing

Hello, I'm Matthew Belloni, and this is What I'm Hearing...
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Happy Sunday, hope you had a nice weekend. We’ve welcomed a lot of new members lately, so a reminder that you can manage which Puck authors and emails you receive by going to this link. Try someone new! I recommend Tara Palmeri, our latest hire, whose The Washington Mall is already the talk of the town.

Discussed in this issue: Jeff Sagansky, Melissa McCarthy, Dana Walden, Tosca Musk, Kevin Mayer, Bob Chapek, Jessica Reif Ehrlich, Kevin Beggs, Rick Caruso, and a Scientology E-Meter.

But first…

Who Won the Week: Tom Cruise

I know, I did Top Gun: Maverick already, but the stunningly small 32 percent second weekend drop ($86 million), a record low for a movie that opened to more than $100 million, can’t be ignored. At $550 million, it has a real shot to get to $1 billion now, as I predicted on The Town.

Runner up: Rich Gelfond, the IMAX C.E.O., for capturing $62.7 million of the Top Gun gross, and about 13 percent of all domestic box office for the film so far ($40 million).

P.S. As a reminder, you're receiving the free version of What I’m Hearing at . For full access to Puck, and to each of my colleagues, you can subscribe here.

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How to Succeed Amid the Great Streaming Correction

I recently chatted with a trio on the frontlines of the content wars about the future of Disney+, what a recession would mean for development (and bidding wars), The Great Netflix Correction, and what Wall Street got wrong about Hollywood.

MATTHEW BELLONI

A few hours before investor-producer Jeff Sagansky went off on the streaming business model at last week’s NATPE conference, I had a great conversation about the transformation of the content business with a few people in the middle of it all: Kevin Mayer, the former Disney executive who co-founded the Blackstone-backed Candle Media, which has bought all or part of Reese Witherspoon’s Hello Sunshine, CocoMelon studio Moonbug Entertainment, Will Smith’s Westbrook (ouch), and the ATTN media company, among others; Jessica Reif Ehrlich, the longtime media analyst and managing director at Bank of America Merrill Lynch; and Kevin Beggs, chairman of Lionsgate Television Group. We talked about what the Great Netflix Correction means for content producers, how Hollywood would hold up in a recession, and whether the age of bidding wars is over. They agreed to let me run excerpts below that have been edited for length and clarity.

Matt Belloni: This panel was supposed to happen in January in Miami. I basically threw out my outline because everything has changed in the past five months. We’ll get into that but Kevin, you’ve bought very disparate businesses. What’s the through line? Like, are there synergies or are they just silos that you’re going to package together?

Kevin Mayer: There are synergies. We’re going to keep the creative energies and the distinct creative approaches separate. But just like at Disney, you buy brands, and the monetization can be centralized—distribution, sales, some of the production facilities and production financing, H.R., all the back office stuff. But [creatively] there is some synergy between the two groups. Reese Witherspoon has a great idea for a kids book called Busy Betty...

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