THB #284: Is There An Answer To This Mess, Pt 2

I hate yesterday’s newsletter.

Essentially, I sucked myself into doing exactly what I was trying not to do… to go down the well and get caught in the morass of trying to dig through the giant pile of excrement that every company in the filmed entertainment business is being forced to dig through right now. I was aiming at clarity and I caught myself in my own trap.

Sorry.

Here are the 20 headline ideas I should have just offered yesterday…

Pay NO attention to Netflix. You are not Netflix.

Netflix’s first mover position allowed it to be an add-on to the cable/satellite bill in most domestic households. But $25 a household is going to be the max for the next decade. Plan for that, not for $200 a month (inc internet) for any more than 20% of domestic households.

Put down the magic beans. The time for temporary fixes, tricking investors, is over.

Create your own language & standards for success & failure. The in-house math for success in streaming - not tied to direct revenue - needs to be clear and industry-public.

Commit to your plan for at least one full year from implementation, not conception.

Acquisitions under $5 billion are reasonable building blocks. Acquisitions over $5 billion, in this moment, are pretty much all going to be too expensive for their value and little more than a distraction from what the acquiring company hasn’t figured out.

Don’t be afraid of risk. The safest road will often be the road that either leads nowhere or into a big ditch.

Comedy is the next “savior” wave. It’s not about bemoaning the lack of comedy being pitched… it’s about finding ways to encourage more talented people, starting with writers, to develop comedies that can be made at a price so that batting .200 still means you can break even, if not generate profits because 1 of 5 attempts explodes.

It’s not just comedy. If the writing world knows what you are looking for, you will get pitches and scripts that reflect your goals. Buyers are in charge of the trends, not the writers and least of all, the public.

It’s the international expansion, dummy.

There is nothing wrong with bundling unless it is done with the same consequences that have made cable/satellite so vulnerable in the last decade. You can’t keep piling up the dollars you expect content-overfed consumers to pay. They will revolt. Unlike cable/satellite, they have real alternatives.

Communicate to your team, consumers, and Wall Street exactly what your intentions are and what your worst and best expectations are.

Be direct. You may be making choices that are not the favorite of talent, producers or agents… but they all would rather take it in the chest than get pulled down from behind their backs. Bad news is not a sin. Lack of trust is deadly.

Don’t be afraid to set your own structure of how you want to deliver content and apply it, even if it breaks the conventions of others.

Accept that there is going to be pain. A lot of pain. Because old tools will die for new tools to live. And dying tools means careers ended. There is no option where the industry doubles in size and accommodates everyone’s needs and desires.

It’s time to get serious about killing the network affiliate system as we have known it. I don’t know the best way to do it in 2023 - not my expertise - but it is time to rethink how mostly out-of-step distribution methods can be rebuilt, hopefully without bankrupting local television stations.

A smart man once said to me, “Give me any amount of product and I will tell you that 20% will be really good, 30% will be okay, 20% will be not good but possibly commercial, and 30% will be the worst crap ever. It doesn’t matter what the content is.” Obviously a little rough. Obviously kinda true.

If you are going to spend significant marketing dollars, either go all the way or pull back. The middle is what kills. Deeper marketing investment may mean that added revenue streams, like real theatrical releases, are needed to make the math make sense. Focusing most marketing in-house may be a perfectly good way to manage your subscription base. Pick a lane.

If subscribers come to your streamer at least 4 times a week and always find 1 or 2 things, new or old, that they want to watch - which doesn’t mean they will watch them right then - they will not churn away.

Theatrical is a premium revenue opportunity for the audience that likes going to the movies. It is not the same as streaming and streaming is not the same as theatrical. They are not interchangeable. If you market a theatrical movie like you do a streaming movie, you will lose. If you market a streaming movie like you do a theatrical, you may not see a real increase in viewership.