What I'm Hearing: MGM, and Who’s Souring on Streaming

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Thursday Thoughts…

My 5 biggest questions now that Amazon’s $8.5 billion MGM deal has closed:

What’s the timeline now? A town hall is set for tomorrow, and I’m told the organizational integration will be fairly swift. After all, everyone has had 10 months to think about this stuff. But how swift? These things often take time and create friction.
What is Barbara Broccoli thinking? A source close to the James Bond producer tells me she’s a bit nervous about the Amazon guys, and she did not comment today. But the Broccolis have the power here. If Jeff Bezos or Andy Jassy think they can fast-track a new Bond movie or treat the producers like others they have bought, they will likely find their phone calls unreturned.
If Biden’s F.T.C. nominee is confirmed and breaks the regulatory agency’s 2-2 tie, will chief Lina Khan dare go after the MGM deal once it’s already closed? Maybe, but I doubt it. Khan has bigger issues with Amazon, such as how it uses its cloud computing unit to benefit its other businesses. She’ll probably focus her efforts there.
Will MGM film chief Mike DeLuca stick around, even if it means reporting to Amazon Studios head Jennifer Salke? MGM will likely operate as a label, like Searchlight under Disney (with bigger budgets), but it’s still unclear how autonomous it will be. DeLuca, deputy Pam Abdy and the other strong film execs could try to negotiate a quasi-island situation under S.V.P. Mike Hopkins, but I doubt Salke would be cool with that. And DeLuca may not enjoy the limited theatrical swings, or be granted the same freedom to pay filmmakers the above-market fees he’s been paying them.
Is there a world in which Hopkins allows MGM TV chief Mark Burnett, a famously power-hungry agent of chaos, anywhere near the Amazon building?

Bonus: I discussed the MGM state of play with media analyst Andy Wallenstein on today’s episode of my podcast, The Town. Listen here...

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Why Hollywood Is Souring (Some) on Streaming

Media companies were betting on the ability to invest big, grow fast, and join Netflix in the redefined TV hierarchy. Now, increasingly, they seem to be asking: What if everything Netflix thought it knew turns out to be a lie?

MATTHEW BELLONI

What if everything you thought you knew is a lie? People think that’s a line from The Matrix. It’s not, actually, but it sounds like it should be, so I’ll co-opt it to talk about this precarious moment in Hollywood.

It’s been about five years since The Walt Disney Co. first announced that it was developing its own Disney-branded streaming service, and in that short time the entertainment industry has fully transformed itself to chase Netflix, Amazon Prime Video, and the 1 billion households that, we’ve all been promised, are absolutely dying to pay for multiple subscription video services.

This was considered the TAM, the “total addressable market,” or the projected number of potential customers just sitting there for the taking. The leading minds at media companies (and the consulting firms that nudge them) have convinced the C-suite trigger-pullers that if you spend enough money streaming Ryan Reynolds time-travel dramas and bizarre dating competitions, the riches of global scale and pricing power await, thanks to that huge TAM. It’s true, because everyone says it’s true...

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